The financial market is a broad term describing the interrelation of various components of an economy, including private and public entities that serve to facilitate commerce through their activities.

Central governments and banks serve to regulate markets and act as stabilizers in times of distress. Federal governments often increase spending when economic activity declines notably. Central banks serve many functions, targeting specifically on controlling inflation, maintaining a steady supply of money, and moderating fluctuations in the business cycle.

Companies are the primary drivers of economic growth, operating under regulations imposed at the federal level. Firms provide goods and services offered to consumers and can be either public or private institutions.

Public companies offer investors equity stakes in exchange for capital in the form of stock, issued through exchanges. The stock market is used as a measuring stick for the relative health of the financial system. It serves as a conduit between investors looking to grow their wealth and companies seeking to raise capital for funding operations.

Finance Markets - Articles By Better Trades