金融学Finance 01

FinanceWangLuxuan(E-mail:[e-mail])References:JosephP.Daniels,DavidD.Vanhoose,(范小云改编)“InternationalMonetaryandFinancialEconomics”3eHigherEducationPress,2005ZviBodie,RobertC.Merton“Finance”HigherEducationPress,2002ChineseTranslationEdition:“金融学”RenminUniversityofChinaPress,2001FrankK.Reily,EdearA.Norton“Investment”7thedition,TsinghuaUniversityPress,2006ZviBodie,AlexKane,AlanJ.Marcus“Investment”8thedition,ChinaMachinePress,2009AbouttheCourse:1.ClassHour:32hAfterClass:32hoursforpreparing{keywords(canbefoundintheglossary)andbriefcontentsfornextclass}32hoursforreview2.TeachingPlan:ClassTeaching,GroupDiscussing,ExercisesExaminationBriefContents1.FinanceandFinancialSystem2.FinancialMarkets,Institutions&Instruments3.InternationalPaymentsandExchange4.InternationalFinancialInstruments,Markets,&Institutions5.AssetPricingIntroductionUSSub-primemortgagecrisisStartfrombankruptofNewCenturyFinancialCorporationinApr.2007followbyLehmanBrothersFederalNationalMortgageAssociation(FannieMae房利美)FederalHomeLoanMortgageCorporation(FreddieMac房地美)hadbeentakenoverthe$700billionfinancialmarketsrescueplanRMB￥4,000billioninvestmentbyChinagov.QuestionsHowthefundflowintheworld?TorF------financialinnovation?Whatisthefunctionofthefinancialmarket&financialinstruments?callanewinternationalfinancialsystem?DefiningfinanceWhystudyfinanceFinancialDecisionsofhouseholdsFinancialDecisionsoffirmsFormsofbusinessorganizationSeparationofownershipandmanagementThegoalofmanagementMarketdiscipline:takeoverTheroleofthefinancespecialistinacorporationChapter1WhatisFinanceDefiningfinanceFinanceisthestudyofhowpeopleallocatescarceresourcesovertimeTwofeature:itscost&benefit----overtime;uncertainFinanceisastudyoftrade-offsbetweenthepresentandthefuture____Givingupsomethingtodaytogainsomethinginthefutureconsistofasetofconcepts&quantitativemodelsWhystudyfinanceTomanageyourpersonalresourceTodealwiththeworldofbusinessTopursueinterestingrewardingcareeropportunitiesTomakeinformedpublicchoicesasacitizenToexpandyourmindFinancialDecisionsofhouseholdsConsumptionandsavingdecisionsInvestmentdecisionsFinancingdecisionsRisk-managementdecisionsAsset:isanythingthathaseconomicvalue(bankaccount;estate;securitiesetc.)Liability:fromborrowingNetworth=Asset-LiabilityFinancialDecisionsoffirmsStrategicplanning:whatfieldsofbusinessesitwanttobeinCapitalbudgetingprocessInvestmentprojectCapitalstructureWorkingcapitalmanagementFormsofbusinessorganizationAsoleproprietorshipApartnershipAcorporationAsoleproprietorshipAsoleproprietorshipisafirmownedbyanindividualorafamily,inwhichtheassertsandliabilitiesofthefirmarethepersonalassetsandliabilitiesoftheproprietor.Hasunlimitedliabilityforthedebtsandotherliabilitiesofthefirm___Ifthefirmcannotpayitsdebts,theproprietor’sotherpersonalassetscanbeseizedtosatisfythedemandsofthefirm’screditors.ApartnershipApartnershipisafirmwithtwoormoreowners,calledthepartners,whosharetheequityinthebusinessApartnershipagreementusuallystipulateshowdecisionsaretobemadeandprofitsandlossestobesharedUnlessotherwisespecified,allpartnershaveunlimitedliabilityasinsoleproprietorshipAcorporationAcorporationisafirmthatisalegalentitydistinctfromitsownersCorporationscanownproperty,borrow,andenterintocontracts.TheycansueandbesuedThecharterofacorporationsetsdowntherulesthatgovernit.Shareholdersareentitledtoshareanydistributionfromthecorporationinproportiontothenumberofsharestheyown.Theshareholderselectaboardofdirectors,whichinturnselectsmanagerstorunthebusiness.UsuallythereisonevotepershareOwnershipsharescanusuallybetransferredwithoutdisruptingthebusiness.Limitedliability__Ifthecorporationfailstopayitsdebts,thecreditorcanseizetheassetsofthecorporationbuthavenorecoursetothepersonalassetsoftheshareholdersSeparationofownershipandmanagementFivereasons:ProfessionalmanagershaveasuperabilitytorunthebusinessAchievetheefficientscaleofabusinessDiversifytherisksacrossmanyfirmsSavethecostsofinformationgatheringThe“learningcurve”or“goingconcern”effectProblems:ConflictofinterestbetweentheownersandthemanagersThegoalofmanagementEnsurethemanagerscanmakedecisionsthatareinthebestinterestsoftheshareholdersTherightruleshouldbeindependentofwhotheownersare-----thatis:theshareholder-wealth-maximizationrule-----Tomaximizethewealthofcurrentstockholdersthewealthofcurrentstockholderscanbevaluedbythepricesofthestockinthestockmarket,thisexternalinformationiseasiertoobtainMarketdiscipline:takeoverArethereanyforcestocompelmanagerstoactinthebestinterestsoftheshareholders?Yes!TakeoversIfafirmisbeingmismanaged,itsmarketvaluewouldbecomelower,atakeoverbidderwillbuyitssharesinalowprice,ifhesuccessfullybuysenoughsharesoftheundervaluedfirmtogaincontrol,itreplacesthemanagerswithonewhowilloperateitoptimally.Heannouncethechange,thensellsthesharesatthenewmarketpriceforanimmediateprofit.Thethreatoftakeoverprovideastrongincentiveforcurrentmanagers.VPOperationsTreasurerVPFinancialPlanningComptrolerChiefFinancialOfficerVPMarketingChiefExecutiveOfficerBoardofDirectorsOrganizationchartforacorporationTheRolesofCorporateFinancialSpec