Financial Markets (2011) with Robert Shiller 21. Exchanges, Brokers, Dealers, Clearinghouses
21. Exchanges, Brokers, Dealers, Clearinghouses Transcript and Lesson Notes
Financial Markets (2011) (ECON 252) As the starting point for this lecture, Professor Shiller contrasts the view of economics as the theory of the allocation of scarce resources with the view of economics as the study of
Quick Summary
Financial Markets (2011) (ECON 252) As the starting point for this lecture, Professor Shiller contrasts the view of economics as the theory of the allocation of scarce resources with the view of economics as the study of
Key Takeaways
- Review the core idea: Financial Markets (2011) (ECON 252) As the starting point for this lecture, Professor Shiller contrasts the view of economics as the theory of the allocation of scarce resources with the view of economics as the study of
- Understand how broker fits into 21. Exchanges, Brokers, Dealers, Clearinghouses.
- Understand how commission fits into 21. Exchanges, Brokers, Dealers, Clearinghouses.
- Understand how dealer fits into 21. Exchanges, Brokers, Dealers, Clearinghouses.
- Understand how New York Stock Exchange (NYSE) fits into 21. Exchanges, Brokers, Dealers, Clearinghouses.
Key Concepts
Full Transcript
Financial Markets (2011) (ECON 252) As the starting point for this lecture, Professor Shiller contrasts the view of economics as the theory of the allocation of scarce resources with the view of economics as the study of exchange. After a discussion of the difference between brokers and dealers, he outlines the history of securities exchanges from ancient Rome, to the Amsterdam Stock Exchange and Jonathan's Coffee House in London, until the formation of the New York Stock Exchange. He complements this historic account with an overview of securities exchanges all over the world, covering India, China, Brazil, and Mexico. An example of a limit order book allows him to elaborate on the mechanics of trading at the National Association of Securities Dealers Automatic Quotation System (NASDAQ). Subsequently, he turns his attention to the growing importance of program trading and high frequency trading, but also discusses their impact on the stock market crash from October 19, 1987, as well as on the Flash Crash from May 6, 2010. When talking about fairness in financial markets, particularly with regard to the relation between private investors and brokers, he discusses the National Market System (NMS), the Intermarket Trading System (ITS), and consolidated quotation systems. He concludes this lecture with some reflections on the operations of dealers, addressing the role of inside information and the Gambler's Ruin problem. 00:00 - Chapter 1. Exchange as the Key Component of Economic Activity 05:50 - Chapter 2. Brokers vs. Dealers 12:25 - Chapter 3. History of Stock Exchanges around the World 24:28 - Chapter 4. Market Orders, Limit Orders, and Stop Orders 36:15 - Chapter 5. The Growing Importance of Electronic Trading 44:46 - Chapter 6. Instabilities Related to High Frequency Trading 59:14 - Chapter 7. The Frustrations as Trading as a Dealer Complete course materials are available at the Yale Online website: online.yale.edu This course was recorded in Spring 2011.
Lesson FAQs
What is 21. Exchanges, Brokers, Dealers, Clearinghouses about?
Financial Markets (2011) (ECON 252) As the starting point for this lecture, Professor Shiller contrasts the view of economics as the theory of the allocation of scarce resources with the view of economics as the study of
What key concepts are covered in this lesson?
The lesson covers broker, commission, dealer, New York Stock Exchange (NYSE).
What should I learn before 21. Exchanges, Brokers, Dealers, Clearinghouses?
Review the previous lessons in Financial Markets (2011) with Robert Shiller, then use the transcript and key concepts on this page to fill any gaps.
How can I practice after this lesson?
Practice by applying the main concepts: broker, commission, dealer, New York Stock Exchange (NYSE).
Does this lesson include a transcript?
Yes. The full transcript is visible on this page in indexable HTML sections.
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