Question

What is the impact of the economy’s decline on the structure of the financial markets?

What is the impact of the economy’s decline on the structure of the financial markets?

Homework Answers

Answer #1

financial market is always a reflection of the state of the economy as it is being believed by the experts so financial market are reflecting the economy in a futuristic way because market participants are always trying to discount various futuristic informations in advance and they will be trying to project the direction of economy movement in advance so, stock market will be a approximate reflection of the moment of the state of the economy.

It has been proven at times because sometime stock market has been exuberant and it has internationally reflected prices in discrimination of its value, but over the period of time in an Efficient market, the prices will be reflective of the true economic status of these countries so it can we say that at the times of the economic recession or even at the time of the pandemic recession, all these economies had been showing a negative downturn and it can be seen that stock market where first to reflect on the decline of the economy, so it can be said that economy will also the declining based upon the stock market performance because stock markets are generally futuristic and it is representing a consensus of a large market participants.

the impact of the decline of economy on the structure of the financial market would be leading to a large number of loss of job and it would also mean that large number of foreign outflows as the foreign nationals will be putting their money out of the economy and it will also mean that there will be a change in the structure of economic growth and it will be projected downside.

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
What is the potential impact of more debt or financial leverage in a businesses capital structure...
What is the potential impact of more debt or financial leverage in a businesses capital structure on Net Income, Earnings Per Share and Return on Equity?
What is the potential impact of more debt or financial leverage in a businesses capital structure...
What is the potential impact of more debt or financial leverage in a businesses capital structure on Net Income, Earnings Per Share and Return on Equity?
Please explain about the seven impact of the financial crisis on the capital structure decision of...
Please explain about the seven impact of the financial crisis on the capital structure decision of UK , French and German firms.
Explain the expected impact of the downturn in the stock and bond markets on the financial...
Explain the expected impact of the downturn in the stock and bond markets on the financial statements of a corporation that holds investments in listed stocks and bonds. grading rubric Explanation and application of the various reporting methods for debt investments, including the accounting for a decrease in fair values. 3 points Explanation and application of the reporting method for equity investments, for which the investor does not have significant influence, including the accounting for a decrease in fair values....
Why are stock markets the most watched and reported of the financial security markets? What are...
Why are stock markets the most watched and reported of the financial security markets? What are the main features of stocks & stock markets that are different from other types of financial securities or markets?
Financial markets-The current Caronavirus outbreak is said to be affecting the global financial market. Using two...
Financial markets-The current Caronavirus outbreak is said to be affecting the global financial market. Using two countries as examples, briefly explain the impact the outbreak of the virus is having on the financial markets of the two countries selected.  
MBA thesis Title :  The Impact of Block Chain Technology on Financial Markets Major: Financial Engineering Research...
MBA thesis Title :  The Impact of Block Chain Technology on Financial Markets Major: Financial Engineering Research Question : as the world is going after IOT (internet of thing), big data, data science and data mining. I will be exploring if Block Chain technology have the potential to be truly disruptive and to transform well established financial institutions, and what are the implications and volatility of strategic and operating models of different types of cryptocurrencies in the market, and the impact...
What should be the role of regulation in financial markets? What are the implications of financial...
What should be the role of regulation in financial markets? What are the implications of financial regulation?
What impact the organization's structure and culture have on internal controls (from an accounting perspective) over...
What impact the organization's structure and culture have on internal controls (from an accounting perspective) over financial reporting.
If a tax cut does not impact the economy’s ability to produce, it will nonetheless tend...
If a tax cut does not impact the economy’s ability to produce, it will nonetheless tend to have some effects. Present an analysis of how a tax cut will impact the economy using the tools presented in class (i.e., a labor market, the IS-LM framework, and an AS-AD diagram) and the Classical perspective. In particular, predict the impacts on employment, the nominal wage level, the real wage level, the output level, the price level, and the real interest rate level.