International Financial Markets Essay Example | Topics and Well Written Essays - 2000 words - 5

International pecuniary Markets - Essay ExampleFurthermore some countries have ended up losing their investment status of grade. This ensuant has placed the international investors in alert. Even before the downgrading of the first country into a grade of non-investment, the store securities industry was down, and some countries even become close to lose their access to capital market. As a result of this the European politicians directed their blame to the crediting rating agency of making thee debt crisis worse.Since 2011, the agency of rating has to regularly register with the European Security and Markets Authority (ESMA) which is also mandated with the further preparation of the legal action (Moloney, 2011). This legislation shows that the rating of credits have some control on the capital market. Some of the specie market issue that was affected by the crisis that is to be discussed in this paper includes the macro-financial risk, intra-euro area financial flow, and coll ateral availability.In most of the countries in euro the deposits owned by the domestic banks were stable between 2010 and 2011. However the domestic banks in Ireland and Greece heavily fell. Ireland and Greece were not in a position to replace the deposits that were lost with other market get or wholesale and the gap that existed by borrowing from their exchange banks (Whittaker, 2011). The relocation of the market money into the central bank balance sheet caused an inter-central bank debt that was very high within the system of the euro.Inter-commercial bank modify is a means of transferring money from area which have surplus to areas deficit areas (Friedman & Schwartz, 1970). For example if funds is pull away from the Greece bank and placed in the bank of Germany, this withdrawal will leave the Greece bank with deficit of money while the Germany bank will be in surplus of money. In the market condition that is normal, the