Connel Fullenkamp – Financial Literacy: Finding Your Way in the Financial Markets

Connel Fullenkamp – Financial Literacy: Finding Your Way in the Financial Markets

The financial markets create tremendous opportunities that, for many of us, would otherwise be out of reach. A new home. Your childs college education. Retirement. Without the ability to borrow and invest, life as we know it simply wouldnt exist.

Taking full advantage of everything the markets have to offer requires not only becoming familiar with its unique instruments, practices, and risks, but understanding the ways the financial world and your own life are inextricably linked in ways both direct and indirect, visible and obscured.

But with record-breaking highs one minute and economy-rocking lows the nextnot to mention arcane rules and ambiguous terminologyit can seem as if theres no way to feel truly comfortable in this mysterious world. But there is, and its more accessible than you might think.

Financial Literacy: Finding Your Way in the Financial Markets is an essential primer on this domain, from its functions, strengths, and possibilities to its weaknesses and vulnerabilities. In 24 eye-opening, plainspoken lectures, award-winning Professor Connel Fullenkamp of Duke University reveals the interconnected workings of the financial markets and how societys financial strengthand your owndepend on money continuing to move through these channels. Youll not only gain a new appreciation for the variety of financial products and services available to you, but also for how crucial we as individuals are to the functioning of the entire system.

Youll clearly see how these markets affect youand vice versaany time youre involved in a financial transaction, whether youre

• financing a car;
• applying for a mortgage;
• receiving a preapproved credit card offer;
• participating in your companys 401K plan; or
• making a deposit at your local bank.

Introductory in nature but by no means taught at a surface level, this course provides the concepts and tools you need to draw direct connections between headlines made globally and whats happening to your bottom line locally. By the final lecture, youll understand just how interdependent the worlds markets have become; feel newly at ease in the realm of stocks, bonds, mutual funds, derivatives, and credit; and be better able to make informed decisions for your financial future.
Learn the Rules of the Game

To many of us, the financial markets seem to play by their own rulesand those rules make little logical sense. For example, when the unemployment rate rises, the stock market sometimes rises along with it. In a short sale, an asset is sold before it is bought. And in the high-stakes world of mergers and acquisitions, financial transactions are routinely done on paper, with massive companies being bought and sold despite no money changing hands. How can this be?

Presuming no prior experience in finance, Financial Literacy unravels these and other riddles as it walks you through the fascinating history of banking, which begins with medieval goldsmiths vaults, and the functions of the instruments and institutions that constitute the system as a whole.

Carefully connecting the dots each step of the way, Professor Fullenkamp demystifies industry jargon and explains how businesses, governments, andprimarilyhouseholds inject funds into the market, revealing that its our money flowing through this labyrinthine network that forms the bedrock of the system.

Youll start the course with an overview of the six essential jobs the financial markets perform for society and how every financial transaction or product attempts to carry out at least one.

Youll investigate how the markets

• transfer resources across time and space, allowing you to buy a home without having the entire purchase price on hand;
• pool resources and share ownership, making it possible for investors to collaboratively lend money to governments and buy into corporations;
• discover financial prices, which can have serious consequences if assets are not set at the right level;
• deal with information problems, thereby mitigating the risks associated with a lack of reliable information about borrowers;
• clear and settle payments, allowing us to easily purchase items anywhere in the world; and
• manage risks by providing safety nets with products like insurance.

Along the way, youll learn answers to questions youve likely pondered, from the reasons hedge funds are permitted to sidestep SEC regulation to what the letter grades used by Standard & Poors and other credit rating agencies really mean.

• How is your credit score calculated?
• What information do lenders take into consideration when you apply for a loan?
• Why do some stocks pay dividends while others dont?
• What happens to your mortgage after you sign on the dotted line?
• How do currency exchange rates work, and how do they affect international investments?

Become a More Savvy Financial Consumer

Financial Literacy provides a solid foundation for both would-be investors and those whove been participating in this space for years without knowing how all the parts fit into the bigger picture. Youll find out how stocks get introduced to the market; how U.S. dollars leave the country; and how market regulation actually protects healthy competition. Youll also learn background on Fannie Mae, Freddie Mac, and mortgage-backed securities, as well as a plethora of practical information, including

• how to calculate payments on amortizing loans;
• why index funds are often a great choice for investors; and
• how to read a companys balance sheet and income statement.

In addition, these lectures offer a rare opportunity to peek inside hedge funds and the money market territory typically closed to the average investoras well as the turf battles that occur between the governments appointed referees. Youll also see how technology and the recent economic crisis are changing the rules around the world.

In the second half of the course, youll investigate which major economic indicators have the biggest impact on the markets, including central banks like the Federal Reserve. While you may regularly hear this enigmatic entity reported on in the media, you may not fully be aware of how the Feds monetary policy affects inflation, bank lending, and interest rates. But you will after you complete this course.

Objective Information from a Sought-After Expert

You could work your way through the bookstores entire finance section or watch hours of cable TV shows on money, but youll never encounter a better resource for this kind of robust, reliable, unbiased information. As both an accomplished educator and a consultant for the International Monetary Fund, Professor Fullenkamp presents each well-informed lecture in an encouraging, engaging manner that leads you to not only comprehend the material, but to get as excited about it as he does.

Add the professors outstanding guidance to the many explanatory graphs, animations, and graphics featured in video formats, and Financial Literacy: Finding Your Way in the Financial Markets yields an unparalleled learning experience. You simply wont find a worthier investment to develop financial fluency.

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