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Faculty
Robert Crawford, Marriott School, Bringham Young University

Course Coordinator
ISUP Secretariat

Prerequisite/progression of the course

Students must have an introductory course in economics as a prerequisite. No restrictions on programmes/concentrations that are allowed to take the elective.

Course content, structure and teaching

The objective of this class is to help you understand the role of money, interest rates and financial instruments and institutions in your life, embedded as you already are in this societal system. The course requires you to re-examine your perspective on money, wealth, work and others. Your perspective is a very personal and private aspect of your "identity" and it changes and grows with your knowledge and experience of the broad context of global economies. This course focuses primarily on the economics of money as the central feature of the financial system, how one finances their participation in that system. As you will see, money is a complex and emotionally charged social construct. You learn how money affects your position in the economy by learning how financial institutions operate; how different financial instruments work and how these two constitute the financial markets. It is through these instruments and institutions that the consequences of money are manifest in your life. The interaction of instruments in their various markets constitutes a vast and complex system in which you are embedded, affecting you even if you know nothing about it nor think you want to participate in it. When you complete the class, you will have an edge in qualifying for work (or an internship) in the system. In the process of studying money, you will increase your comfort level dealing with ambiguity. Life is essentially uncertain and no amount of knowledge can remove that uncertainty. Money mitigates uncertainty.

Learning Objectives

1. learn the rudiments of a financial system, how it affects the economy and your participation in it.
   • reading the assigned material and applying it in class
   • showing proficency on exam questions pertaining to the course measured by your score relative to peers
2. learn how to read and interpret the financial press and to follow financial data in main financial instruments. Accomplished by:
   • reading regularly in the financial press
   • pertaining to a selected financial topic form the course, weekly select an article from the financial press; commentin on its relevance to your topic and interpreting its meaning for your topic.
3. gain a foundation in "intermediate macroeconomic analysis" - an understanding of the interaction of nations in the global economy. Most of the lectures and reading assignments in this class are about such analysis. Accomplished by:
   • practice using the language and theory correctly in class discussion.
   • showing proficiency on exams relative to the class peers.
4. gain a "proxy" experience at understanding your personal visceral reaction to risky financial activity. As you trade in your own portfolio, you will begin to see the implications of our embodied everyday lived experience. Accomplished by:
   • Virtually trade all the studied instruments in your trial portfolio and keeping a record of the results. One trade must be made for each class session.
   • complete an analysis of a current issue as a course project that applies what you have learned to the issue. The issue will be determined at the beginning of the course.

Teaching methods

Teaching method includes lectures, exercises and problem solving, case study discussions.

Examination

Mandatory mid-term feedback assignment: In order to be allowed to take the final exam, each student must have submitted a written assignment (to be completed in class).

Final exam: 4-hour written exam (closed book)

Exam aids: Financial calculator; One page of individually crafted typed notes.

Re-take exam: 24-hour written exam.

Recommended literature

• Steven G. Cecchetti, Money, Banking and Financial Markets, McGraw Hill Publishing Company, 2E 2008. (300 Pages used)
• Selections from: International Wall Street Journal, Financial Times, Economist (100 Pages
• Crawford, Robert G., and Anderson, Travis T. “Money, Morality and Money Laundering” Indian Journal of Economics and Business, Spring Issue (2008) (10 pgs.)

Last updated by ISUP Secretariat 29/01/2010