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Complexities of the U.S. Financial System - Essay Example
Author : americabaumbach
Finance & Accounting
Pages 3 (753 words)
Complexities of the U.S Financial System Student’s Date: How the U.S. financial markets impact the economy, businesses, and individuals The term financial market may be simply defined as the place where different companies find capital that they use to expand their operations…
However, in this study, I seek to express the impacts of the same in U.S to individuals, businesses and the economy in general. A well developed financial market that smoothly operates can be of great significance to the economy by contributing towards its efficiency and health. A strong positive relationship exists between the economic growth rate and the development of financial markets. To the economy of U.S, the development of strong financial markets that have then continued to exert huge positive pressure that have greatly impacted on the economy. Specifically, the growth of financial markets has efficiently aided the direct flow of investments and savings in the economy. As a result of this, there has been huge accumulation of capital in the economy, as well as the enhancement of production of goods and services in the country. A good combination of flourishing financial market, diverse array of financial instruments and products and well developed financial institutions also attracts more borrowers and suits the lenders’ needs hence, positively impacting on the economy. Furthermore, the financial markets in U.S due to their efficiency have lowered the economy’s search and transaction costs (Norton & Melicher, 2013). ...