Part One: Introduction1. Why Study Financial Markets and Institutions?2. Overview of the Financial System Part Two: Fundamentals of Financial Markets3. What Do Interest Rates Mean and What Is Their Role in Valuation?4. Why Do Interest Rates Change?5. How Do Risk and Term Structure Affect Interest Rates?6. Are Financial Markets Efficient? Part Three: Fundamentals of Financial Institutions7. Why Do Financial Institutions Exist?8. Why Do Financial Crises Occur and Why Are They So Damaging to the Economy? Part Four: Central Banking and the Conduct of Monetary Policy9. Central Banks and the Federal Reserve System10. Conduct of Monetary Policy: Tools, Goals, Strategy, and Tactics Part Five: Financial Markets11. The Money Markets12. The Bond Market13. The Stock Market14. The Mortgage Markets15. The Foreign Exchange Market16. The International Financial System Part Six: The Financial Institutions Industry17. Banking and the Management of Financial Institutions18. Financial Regulation19. Banking Industry: Structure and Competition20. The Mutual Fund Industry21. Insurance Companies and Pension Funds22. Investment Banks, Security Brokers and Dealers, and Venture Capital Firms Part Seven: The Management of Financial Institutions23. Risk Management in Financial Institutions24. Hedging with Financial Derivatives GlossaryIndex Chapters on the Web25. Savings Associations and Credit Unions26. Finance Companies