The document discusses financial systems at various levels - firm, regional, and global. It provides definitions of financial systems and their key components. At a high level: 1) Financial systems allow the exchange of funds between lenders, investors, and borrowers. 2) They consist of complex, closely related markets, services, and institutions to efficiently link investors and depositors. 3) Major components include banks, financial markets, instruments, and services.

1. Introduction offinance system
A financial system(withinthe scope of finance)isasystemthatallowsthe exchange of fundsbetween
lenders,investors,andborrowers.Financial systemsoperate atnational,global,andfirm-specificlevels.
Theyconsistof complex,closelyrelatedservices,markets,andinstitutionsintendedtoprovide an
efficientandregularlinkage betweeninvestorsanddepositors.
Money,credit,andfinance are usedas mediumof exchange infinancial systems.Theyserve asa
mediumof knownvalue forwhichgoodsandservicescanbe exchangedasan alternative tobartering.A
modernfinancial systemmayinclude banks(publicsectororprivate sector),financial markets,financial
instruments,andfinancialservices.Financial systemsallow fundstobe allocated,invested,ormoved
betweeneconomicsectors.Theyenable individualsandcompaniestoshare the associatedrisks.
A financial system is the system that covers financial transactions and the exchange of money
betweeninvestors,lenderandborrowers. A financial systemcan be definedatthe global,regional or
firm specificlevel.Financial systemsare made of intricate and complexmodelsthat portray financial
services,institutionsandmarkets that link depositorswithinvestors.
The firm'sfinancial systemis the setof implementedproceduresthattrack the financial activitiesof
the company. On a regional scale,the financial systemis the systemthat enableslendersand
borrowers to exchange funds.The global financial system is basicallya broader regional systemthat
encompassesall financial institutions,borrowersand lenderswithinthe global economy.
There are multiple componentsmakingup the financial systemof differentlevels:Withinafirm,the
financial system encompassesall aspects of finances.For example,itwouldinclude accounting
measures,revenue and expense schedules,wagesandbalance sheetverification.Regional financial
systemswould include banks and other financial institutions,financial markets,financial servicesIn a
global view,financial systemswouldinclude the International Monetary Fund,central banks, World
Bank and major banks that practice overseaslending.
Financial Market Components
Financial systemsare strictly regulatedbecause theydirectlyinfluence financial markets.The stability
of the financial markets plays a crucial role in the monetary protectionof consumers. These financial
systemsare mostly handledby financial institutionswhich include commercial banks, central banks,
publicbanks and cooperative banks. Cooperative banks and developmentbanksmanaged by states
are also listedunderfinancial institutionsthat have heavilyregulatedfinancial systems.
Financial systemsare not onlyevidentin bank financial institutions.Some institutionshave market
brokering,investmentand risk poolingservices.However,these institutionsare non-bank financial
institutionsthat are not regulatedby a bank regulationfirmor agency. Examplesof non-bankfinancial
institutionsare companiesthat offermutual funds,insurance,and financial loans. Companieswith
commodity traders are also consideredto be non-bank financial institutionsthat have financial
systems.

2. Another componentof financial systemsare financial markets that trade commodities,securitiesand
other itemsthat are traded according to general supply and demand.Financial markets include the
primary markets and secondarymarkets. Primary markets provide avenuesfor buyersand sellersto
buy and sell stocks and bonds.Secondary markets provide a venue for investorsand traders to
purchase instrumentsthat have beenpreviouslybought.
Aside from financial institutionsand markets, financial systemsare also evidentin financial
instruments.These financial instrumentsinclude cash instrumentsand derivative instruments.Cash
instrumentsinclude loans,depositsand securities.Derivative instrumentsare financial instruments
that are dependentonan underlyingasset'sperformance.
financialsystema networkof financialinstitutions(COMMERCIALBANKS,BUILDINGSOCIETIES,etc.) and
markets(MONEYMARKET,STOCKMARKET),dealing in a variety of financialinstrumentsBANK
DEPOSITS,STOCKSand SHARES,etc.),which areengaged in money transmission activitiesand the
provision of LOAN and CREDIT facilities. The financialinstitutionsand marketsoccupy a key position in
the economy asintermediariesin channelling savingsand otherfundsto borrowersand investors.In
doing this oneof their main roles is to reconcile the differentrequirementsof saversand borrowers,
thereby facilitating a higher level of saving and investmentin theeconomy than would otherwisebethe
case.Depositorswith financialinstitutionsare seeking a relatively risk-freerepository fortheir monies,
combining ready accessto their money with a longerterm investmentreturn,which providesforcurrent
incomeand/orcapitalappreciation.Borrowers,in general,require accessto fundsof varying amountsto
financeshort-,medium- and long-termdebtand capitalinvestment,often,asisparticularly thecase
with businessinvestments,underconditionsof substantialrisk.The financialinstitutionshelp to reconcile
these differentrequirementsin three main ways:
1) by combining togetherthedepositsand savings of many individuals,thusmaking itpossibleto make
single large-scaleloans;
2) by pooling theresourcesof many depositorsand saversto provideboth foran individualto withdraw
his fundsatshortnotice while maintaining,in the round,a substantially largeand stablefinancialbase
to underpin long-termlending;
3) by holding a diversified portfolio of assetsand lending fora variety of purposesso asto providefor
variousrisk-return combinations.

3. Hubungkaitsystemkewangandengansystemglobal
1) asas fungsi global adalahuntukmemperuntukkansumberyangterhaduntukmenghasilkan
penggunaantanpaterhadyangdiperlukanolehmasyarakat.
2) kekurangansumberuntukdiperolehi dalammenghasilkanbahanmentahdanmenyatukankesemu
aspekekonomi ( tahah,buruh,pengurusandanusahawan) dalammenghasilkanprodukdan
perkhidmatanyangdiperlukan.
3) systemekonomi menggabungkan4inputdalammenghasilkanoutputuntukprngeluaran.
4) ekonomi global adalahmenjanakanaliranpengeluarandanmemulangkan balikaliranpembayaran.
Carta alir:
5) aliranputaran yangdihasilkandaniasentiasasalingbergantungdantidakada penamat.
The role of market in the global economicsystem .
1) marketadalahtempatuntukmenghubungkanpenjual danpembelibertukarbarangandan
perkhidmatandansumber.
2) pertukaranini menentukankuantiti suatuprodukdanperkhidmatanyangdiperlukan.
3) marketjuga tempatmengenal danmemperkenalkanperkhidmatanbaruuntukmasyrakat.
4) peralihanperngeluarandicapai apabilapertukarandenganperkhidmatandanbarangan.
5) apabilafirmabaru masukdalampasaran , iaakan memperkenalkanBrangandanperkhidmatanyang
menjadi pesaingandenganyanglain.
6) marketjuga tempatmemperolehidanmenjanakeuntungan
Type of Market
1) tiga jenispasaranyangdijalankandalamekonomi global iaitu
 Factor pasaran
 Penghasilanpasaran (product)
 Kewanganpasaran( financial )
2) factor pasaran adalahmemperuntukkanfactorpenghasilandenganpengedarankeuntungan(
gaji/upah/sewa) kepadapemilik sumber.
3)keuntunganakandiperolehimelaliui denganpembelianbarangamdanperkhmatandi pasaran.

4. 4) cnth yang menjadi keutamaanpenggunaadalahpakaian,makanan,automobile danlain-lainlagi.
Hubungkait kewangan pasaran dengankewangan system ( simpanan dan pelaburan)
Carta alir
1) Financial market
- Salahsatu alirandalampasaran
- sebagai fungsi pentingdalamekonomi global
-apabilaseseorangatauinstitusi membuatsimpanan,makaiamemerlukandanayanglainuntuk
membuatperbelanjaandan membekukankewangan.
2) savings
Definisi simpananberbezamengikuttahapunitekonomi.
- Isi rumah ( apa yangtersisadrpdpendapatansemasaselepasperbelanjaandanbayarancukai)
- Business( pendapatanyangtersisaselepasdiveden,cukai danperbelanjaan)
- Kerajaan(lebihanpendapatansemasaselepasmembuatperbelanjaan)
3) investment
-danasimpananmembantuekonomiglobal dengancarapelaburan
-pelaburansecaraumumdenganpengambilalihanbaranganmodal ,perkhidmatandanbarangan
mentah.
- Business - pelaburandalam(baranganmodal/yangbolehdijual /baranganmentah)
- Isi rumah – pelaburandalamperbelanjaanbaragantahanlama/perkhidmatan.
- Kerajaan- memperuntukanpelaburandalanpembangunandanfasilitilain.
-pelaburanmeningkatmakapenghasilanpengeluaranmeningkat
Pelaburanmemerlukanjumlahdanayangtinggi.
Fungsi ekonomi dalamsystemkewangan
1) saving
- Pasaran daninstitusi kewanganbertindaksebagai salurankpadatabungan

5. - Productkewangansptbon/sukuk/sahamyang dijual di pasaranwangdan modal meyediakan
simpananyangmenguntungkandanberisikorendah.
- Tabunganini membantuperkembanganekonomi
- Ia juga menngkatpenggunaanmasahadapan.
- Tabunganini ada hubungkatdenganpelaburandimanaiaakanmeningkatpengeluaran
ekonomi.
Pasaran wang
Pasaran wangdirekauntukmembuatpinjamanjangkapendek.Iaadalahinstitusi melaluimanaindividu
dan institusi denganlebihansementaradana memenuhi keperluanpeminjamyangkekurangandana
sementara(defisit). Iaadalahsekuriti ataupinjamanyangmatangdalamtempohsatutahunatau
kurangdianggapsebagai wang instrumenpasaran.Salahsatufungsi utamapasaran wangadalahuntuk
membiayai keperluanmodal kerjasyarikatdanuntukmenyediakankerajaandenganjangkapendek
dana sebagai ganti cukai.Pasaranwangjuga menyediakandanauntukspekulatif membeli sekuriti dan
komoditi.
Pasaran modal
Sebaliknya,pasaranmodal dirancanguntukmembiayaipelaburanjangkapanjangolehperniagaan,
kerajaan,danisi rumah.Dagangan dana di pasaran modal membolehkanpembinaankilang,lebuhraya,
sekolah,danrumah.Kewanganinstrumendalampasaranmodal mempunyaikematanganasal melebihi
satu tahundan pelbagai saizdari pinjamankecil kepadakreditberjuta-jutadolar.Sebaliknya,pembekal
utama danpeminjamdanadalam pasaran modal adalahlebihberbezadaripadapasaranwang.Sebagai
contoh,keluargadanindividu,ketikpasaranmodal apabilamerekameminjamuntukmembiayai rumah
baru. Kerajaanbergantungkepadamodal memasarkandanauntukmembinasekolahdanlebuhraya
dan menyediakanperkhidmatanyangpentingkepadaorangramai.Peminjamyangpalingpentingdi
pasaran modal adalahperniagaansemuasaizyangmengeluarkaninstrumenhutangjangkapanjang
yang mewakilituntutanterhadappendapatanmasadepanmerekauntukmenampungpembelian
peralatandanpembinaankemudahanbaru.
OpenversusNegotiatedMarkets
Satu lagi perbezaanantarapasaran dalamsistemkewanganglobalmemberi tumpuankepadaterbuka
pasaran berbandingpasarandirunding.Sebagai contoh,beberapabonkorporatdijual di pasaran
terbukakepadapembidatertinggidandibeli dandijual sebilanganbesarkali sebelummerekamatang
dan dibayar.Sebaliknya,dalampasarandirundingkanuntukbonkorporat,sekuriti umumnyadijual
kepadasatuatau beberapapembelidi bawahpersendiriankontrak.
Seorangindividuyangpergi ke bankirnyauntukmendapatkanpinjamanuntukmemasukikeretabaru
pasaran berundinguntukpinjamankereta.Di pasaranuntuksahamkorporatterdapat bursa saham
utama,yang mewakili pasaranterbuka.Beroperasipadamasayang sama

6. PrimerversusSecondaryMarkets
Pasaran kewanganglobal jugabolehdibahagikankepadapasaranutamadanpasaran sekunder.Pasaran
utama adalahuntukperdagangansekuriti baru.Sebaliknya,tawaranpasaransekunderdalamsekuriti
yang dikeluarkansebelumini. iaitu,menyediakanjalanuntukmenukarinstrumenkewanganke dalam
tunai.Jikaanda menjual sahamsahamataubon anda telahmemegangbeberapalamakepadarakan
atau memanggil brokeruntukmembuatpesananbagi sahamkini sedangdiniagakan.
Jumlahperdagangandi pasaransekunderjauhlebihbesardaripadapasaranutama.Walau
bagaimanapun,pasaransekundertidakmenyokongpelaburanbaru.Walaubagaimanapun,pasaran
utama dansekunderrapatrapat. Contohnya,peningkatandalamHargakeselamatandi pasaran
sekunderbiasanyamembawakepadakenaikanhargayangserupapadasekuriti pasaranutama,dan
sebaliknya.Ini berlakukeranaramai pelaburmudahberalihdari satupasarankepadayanglainsebagai
tindakbalaskepadaperbezaanhargaatau hasil.