Sample Business Paper on The Stock Market and the Economy Summary

Financial markets are places that provide an opportunity for the selling and buying of different assets. The market forces of demand and supply purely determine the trading of the various assets and commodities. Some of the financial commodities include bonds market, stock market, money market and, foreign exchange market.

Bonds Market

Bonds market provides a platform where companies and governments can source for funds to undertake major projects from the sale of bonds. In this market, different investors can buy bonds worth a certain amount of money. The company or the government is expected to pay back bonds within the specified timeline, with the accrued interest. The Bond market allows the U.S. government to fund major projects from funds that can be refunded later with interest.

Stock Market

In the stock market, public companies can trade their ownership through shares. In this market, people have an opportunity to buy and sell shares of different companies. If people buy shares and sell them at a higher price, they earn profits. This means that a person must make a ground check on the best performing company shares. According to Fabozzi, Modigliani, & and Ferri, 1994). The stock market helps the companies raise money through the sales of shares that also be traded by the owners. It ensures the smooth running of the business operations.

Money Market

The money market allows for lending and borrowing of money within a short time for other business operations. through this, many financial entities can balance their liquidity for continuous operations. financial institutions can lend the money deposited to other individuals or institutions that are in a short supply of finances. Therefore, this market helps the government meet financial needs by allowing lending and borrowing at interest. The lender and the borrower benefit from the product.

Foreign exchange market

The foreign exchange market remains the largest and most global liquid financial market. It allows for the trading of all types of currencies through the market determination of prices (Egan, 2005). Through this market, the government can speculate dollar values to avert financial risks that may be impending.



Egan, J. (2005, 19 June). “Check the Currency Risk. Then Multiply by 100”. The New York


Fabozzi, J., Modigliani, F., & and Ferri, M. (1994). “Foundations of Financial Markets and

Institutions.” Englewood Cliffs, New Jersey: Prentice Hall Inc.