MoneyMarket论文解读.docx

1、MoneyMarket论文解读 金融市场与机构 题目：Money Market 姓名：胡金义 学号：2014132127 学院：外国语学院 目录1.Money Markets Defined32.Functions of the money market53.Participants74. Common money market instruments 9 Money MarketAbstract: As money became a commodity, the money market has became a component of the financial markets for

2、assets involved in short-term borrowing, lending, buying and selling with original maturities of one year or less. Trading in money markets is done over the counter and is wholesale.It provides liquidity funding for the global financial system. Money markets and capital markets are parts of financia

3、l markets. The instruments bear differing maturities, currencies, credit risks and structure. Therefore they may be used to distribute the exposure.Key words:money market；trading；funding . The money market plays a crucial role in financing both internal and international trade. Together with the cap

4、ital market, they constitute the core and main body of one countrys financial market. Chinas money market witnesses a rapid growth in 1998. Since then, Chinas money market keeps flourishing. To some extent, the money market in China is a consequence of the initiation of the socialist market economy

5、and also it is the natural result of the reform in Chinas market economy. With more than one decades development, the money market in China has been shaped with a certain scope and has formed its own framework and submarkets including the interbank lending and borrowing market, the repurchase market

6、, the bond market and the bill market. Now, Chinas money market performs significance in Chinas financial market and has a major effect on monetary policies.However, the liquidity tightness that happened from June, 2013 sounds the alarm to us that Chinas money market is still immature. This event re

7、flects a bunch of deficiencies in Chinas money market and makes people feel compelled to reassess the existing mode of Chinas money market and seek for solutions towards the problems.Actually, the market showed signs of tightness since late May, 2013, while it exploded on June 20, when the Shanghai

8、Interbank Offered Rate or Shibor increased to 13.44 percent, exceeding even the highs posted during the financial crisis in 2008 and setting a new record high for the decade. At the same time, The Economic Observer released an article called Chinas Money Market Meltdown, saying that, “A temporary sh

9、ortage of capital swept through Chinas financial markets and most financial institutions rushed the market to locate funds. Investment managers, financial analysts and even the administrators charged with regulating the system were all asking the same question:Do you still have money?”, which pointe

10、d out the severity of this incident.This incident was mainly due to the excessive faith in short-term inter-bank loans and excessive lending that surpassed the limits set by regulators. Banks should be able to solve the liquidity problem by themselves, instead of relying on the Central Bank or other

11、 large banks. While in fact, some banks have been overdependent on large scale lending from other banks on the wholesale market but there were serious problems in terms of a mismatching of maturity, which brought a lot of pressure on the management liquidity. Actually, the example above is just a mi

12、niature of current problems in the money market. Now the biggest problem is the unbalanced development existing within the money market and between the money market and the capital market. In a deep sense, the current liquidity tightness is caused by it. 1.Money Markets DefinedMoney market securitie

13、s are usually sold in large denominations ($1,000,000 or more).They have low default risk and mature in one year or less from their issue date.Money markets are the global financial markets for borrowing and lending in the short term. On these markets, Treasury Bills are bought and sold, as are comm

14、ercial deposits and bankers acceptances. Financial institutions and those who deal in money are the main participants in this market when they wish to borrow or lend money. They can engage in these dealings for short-term periods of up to thirteen months. Many people do not realize that banks borrow

15、 from each other using this type of market. A segment of the financial market in which financial instruments with high liquidity and very short maturities are traded. A typical money market instrument is worth $1 million or more. These instruments have maturities ranging from one day to one year (th

16、e average is less than three months) and are extremely liquid. Consequently, they are considered to be near-cash equivalentsindeed, even part of themoney supplyby some definitionshence the name money market instruments. For the lender/investor, the market provides a modest rate of return on funds that are not being used presently, but