Artikel mit dem Tag "finance"

17. April 2018
I know the topic of shadow banking is hard to grasp but as it counts for over $45tn; you might want to give it a try. ““Shadow banking” grew by nearly 8 per cent globally to more than $45tn on a conservative measure […]Shadow banking — the parts of the financial system that perform bank like functions such as lending but do not have the same safeguards — accounted for 13 per cent of total global financial assets.” FT March 2018 Most people have probably never heard of shadow...
24. Oktober 2017
You think credit default swaps are none of your business? I promised that they affect you. Here is an easy explanation what they are in why they caused the financial crisis in 2011? “AIG needed a $185bn taxpayer bailout after it was brought to its knees by financial products such as credit default swaps.” (Article: AIG freed from ‘too big to fail’ regulation from 09.2017) Credit derivatives like credit default swaps are comparable to an insurance that protects you from the risk of credit default

14. September 2017
“He (Mario Draghi) hinted markets were right to bet against the ECB increasing interest rates before 2019, saying repeatedly that low interest rates would remain in place […].” What are the impacts of high or low interest rates for companies that borrow money based on a floating rate and how can they hedge the risk of rising interest rates? Here is an easy explanation of how to hedge interest rate risk with an interest rate swap.
25. Juli 2017
"Saudi Arabia has the ability to exert a similar influence over oil by hedging its long-term production through the oil derivatives market. In other words, it should concurrently cut output and sell long-dated oil futures and related contracts." We talked about liquidity risk in the last blog entry, now I am going to show you how banks or companies can hedge liquidity risks. I will first explain interest rate forwards and futures, interest rate swaps and then credit default swaps. Believe me,...

10. Juli 2017
"What is the Volcker Rule? - A federal regulation that prohibits banks from conducting certain investment activities with their own accounts, and limits their ownership of and relationship with hedge funds and private equity funds, also called covered funds. The Volcker rule’s purpose is to prevent banks from making certain types of speculative investments that contributed to the 2008 financial crisis." The banking system has evolved, we are no longer living in a world, where banks only...
13. Juni 2017
In this Blog post, I am going to explain the: CAPM Farma French Model 4 Factor Model Momentum Strategy How to evaluate portfolios Why passive investment is more successful?

12. Juni 2017
Even though markets have hit all time highs and Britain is doing quite well, the Brexit has far-reaching impacts on the British economy but they are hard to detect because the Bank of England has supported its economy tremendously. Before we start with the last entries of this blog series about money and banking, I want to show you, how you can use the concepts to understand what is going on in the real world. I have drafted that article 4 months ago but I have updated it and we are still not...
12. Juni 2017
The buzzword Fintech seems to be almost out of date and super relevant at the same time because I think, it's shaping an industry that hasn't changed a lot in the past decades. The new buzzwords seem to be RegTech and InsurTech. That are companies that make insurance and regulations easier and cheaper. In this article I write about: Millennials that are more skeptical towards financial institutions and technology driven than ever There are huge investment into Fintechs but they start declining...

11. Juni 2017
“Fed Raises Interest Rates for Third Time Since Financial Crisis” Now we can bring everything together. How the Fed, the banks, the dealers, interest rates and assets prices are all linked together and what happens in a crisis. The central bank is supposed to keep the balance of elasticity and discipline in the monetary system and to control the flow of credit and to provide internal stability.
09. Juni 2017
“Borrowing at the discount window is essentially a repurchase agreement — pledging collateral in exchange for cash.” This blog article is not on sale, but I am going to explain the "discount mechanism". We are continuing to work with the dealer concept. The dealer was the person that takes the risk on his balance sheet to make transactions possible and receiving a risk premium for that. I am buying the drinks for my party from the supermarket. Due to the fact that I can not pay for them...

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