Capital Markets
Capital markets are important because they finance economies, allocate risk, and support economic growth and financial stability. Capital Markets ensure that businesses have more continual access to affordable funding options and liquidity and are able to fund growth and job creation.
Capital markets also enable debt issuance, which is a more efficient and less restrictive form of borrowing for corporations. Capital markets match borrowers and investors, acting as shock absorbers during times of economic stress or market turmoil when bank lending can dry up. By diversifying risk, capital markets provide a stable source of fuel for companies, governments and therefore economies.
Additionally, capital markets help individuals generate wealth and invest in their futures. They can invest in a multitude of types of securities, including stocks, ETFs, mutual funds, corporate bonds, US Treasuries, municipal securities, etc. Capital invested, and any corresponding appreciation, can be used by individuals to invest in their retirement, buy homes or save for college. Further, capital markets provide the fuel for companies or entrepreneurs to turn an idea or industry innovation into an actual company or expansion for an existing firm. This in turn creates jobs and spurs economic growth.
