Here is the synopsis of our sample research paper on FINANCIAL INTERMEDIARIES AND WHY THEY EXIST. Have the paper e-mailed to you 24/7/365.
Essay / Research Paper Abstract
This 2.5-page paper focuses on the business of financial intermediaries and their importance to the economy. Bibliography lists 3 sources.
Page Count:
2 pages (~225 words per page)
File: D0_MTfinter.rtf
Buy This Term Paper »
Unformatted sample text from the term paper:
services. These are financial intermediaries that help the money supply flow smoothly between Central Banks (such as the Federal Reserve), corporations and individuals. Intermediaries, therefore, are in business to
move the savings of households into the investment of firms (Cecchetti, 1999; see also McAndrews and Roberds, 1999). Firms and businesses need capital
and supply assets to the markets to get this capital in the form of stock dividends or interest (Cecchetti, 1999). Households are the prime holders of these assets (Cecchetti, 1999).
The role of financial intermediaries has changed since the Fed was created in during the early 20th century in response to the
panic withdrawals from bank accounts. The original job of banks, when they were first built, was to change short-maturity liabilities into long-maturity assets (Cecchetti, 1999).
But during the merger-mania days of the 1980s and 1990s, financial intermediaries took on other roles as well when it came to mergers and acquisitions, providing
representation and advice to both parties (DiStefano, 2001). These days, when a financial intermediary acts as a connection between two businesses that want to create a merger, this intermediary is
basically there to help identify and advise on the flow of assets (such as stock or money) that would be necessary in order to successfully close the merger or acquisition.
This goes somewhat beyond the money channel that we used as a definition earlier in this paper. In addition, financial intermediaries are expected
to provide continued access to liquidity, both in the form of demandable deposits or a standby line of credit (Cecchetti, 1999). Some analysts predict that in long-term, the trend will
...