A macroeconomic model that graphically represents two intersecting curves, called the IS and LM curves. The investment/saving (IS) curve is a variation of the income-expenditure model incorporating market interest rates (demand for this model), while the liquidity preference/money supply equilibrium (LM) curve represents the amount of money available for investing (supply for this model). |||The model attempts to explain the investing decisions made by investors given the amount of money they have available and the interest rate they will receive. Equilibrium occurs when the amount of money invested equals the amount of money available for investing.
An offer made by one company to buy the shares of another for a much higher per-share price than what that company is worth. A bear hug offer is usually made when there is doubt that the target company's management will be willing to sell. Taobiz explains Bear Hug The name "bear hug" reflects the persuasiveness of the offering company's overly generous offer to the target company. By offering a price far in excess of the target company's current value, the offering party can usually obtain an agreement. The target company's management is essentially forced to accept such a generous offer because it is legally obligated to look out for the best interests of its shareholders.
A certificate of deposit whose interest rate fluctuates in inverse correlation to the value of an underlying market index. In other words, the interest rate paid on the CD increases as the underlying market index decreases in value. Taobiz explains Bear CD This type of CD is used for two main purposes: speculation or hedging. An investor may want the safety of a CD but with the market exposure of a bear CD. This CD is bearish because the investor is betting that the market will fall during the life of the CD. This type of instrument is also used to hedge actual market positions. If an investor has a long position that is highly correlated to the underlying market index, he or she may invest his or her excess cash in a bear CD, which can offset losses in the market investment.
An international organization that issues guiding principles and standards within the banking, insurance and capital market sectors in order to promote stability in the Islamic financial services industry. The ISFB consists of: The general assembly, which includes all members of the ISFB The council, which acts as the policy making body of the IFSB and includes the senior executive of each full member of the organization The technical committee, which advises the council on issues and consists of up to 15 persons appointed by the council The working group, which drafts standards and guidelines and reports to the technical committee The secretariat, which acts as the permanent administrative body and is headed by a secretary-general appointed by the council |||based in Kuala Lumpur, Malaysia, the IFSB began operations in early 2003. The IFSB issues standards and principles in the areas of capital adequacy, corporate governance, risk management and transparency, among others. The goal of the IFSB is to promote the awareness of issues that could have an impact on the Islamic financial services industry. It issues Sharia-compliant standards, holds conferences and seminars, and provides guidance and supervision, among other initiatives.
The process of creating the appearance that large amounts of money obtained from serious crimes, such as drug trafficking or terrorist activity, originated from a legitimate source. Some estimate the size of the problem is over $500 billion annually. Often thought of as a victimless crime, money laundering is a very serious issue. Without it, international organized crime would not be able to function.
An order to buy or sell a security at a price lower than the current market price. Taobiz explains Below the Market Investors may choose to place a limit order to buy, a stop order to sell, or a stop-limit order to sell. In order to limit losses, investors holding a long position may place a stop order, which activates the sale of the securities if the price declines below a particular point.
A letter of credit that can't be canceled. This guarantees that a buyer's payment to a seller will be received on time and for the correct amount. |||This is often used in international transactions.
A money center bank is similar in structure to a common bank, but its borrowing and lending activities are with govenments, large corporations and regular banks. These types of financial institutions do not borrow from or lend to consumers. Money center banks are usually located in major economic centers such as London, Hong Kong, Tokyo and New York. With their large balance sheets, these banks are involved in national and international financial systems.