Complexities of the U.S. Financial System

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Complexities of the U.S. Financial System

Category: Narrative Essay

Subcategory: Finance

Level: College

Pages: 2

Words: 550

Complexities of the U.S. Financial System
Complexities of the U.S. Financial System
Financial markets that operate smoothly and developed well are crucial in promoting the wellbeing and efficiency of the economy in the US. The economic growth in the US can be realized if the regions’ financial markets are developed. Financial markets give different investors the opportunity to operate in specific markets or diversify their risks. Financial markets impact the economy, businesses, and individuals differently.
One-way financial markets impact the economy is by directing the overall flow of investments and savings in the economy in ways that ensure capital accumulation and the provision of goods and services (Mian, 2010). Developed financial markets with different instruments and products are needed by both lenders and borrowers who make up the economy. The financial markets also affect businesses as they are known to be the greatest beneficiaries when it comes to accessing credit facilities.
A smooth economy can finance businesses without problems. When financial markets refuse to offer credit facilities to businesses, they often become irrelevant when there is a need to provide quality and timely services and goods to their customers. Increased interest rates often make it hard for companies to secure loans leading to layoffs. Such a move is considered when corporations desire to reduce costs and avoid failing on their part while prov…

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