Chapter 1:

1. Funding liquidity
2. Market liquidity
3. Electronic payment:
- Debit card
- Stored value card
- Electronic cash
- Electronic check
4. Money aggregates:
- M1: currency, demand deposit, travelers’s checks
- M2: M1 plus saving deposit, small time deposit, retail MMMF
- M3: M2 plus institutional MMMF, large time deposit, repos, Eurodollar
- MZM: M2 plus institutional MMMF minus small time deposit.
Chapter 2
5. Financial instruments: a written legal obligation of one party to transfer something of value
( usually money) to another party at some future day under certain conditions.
6. Three functions of financial instruments:
- Means of payment
- Store of value
- Transfer of risk
7. 2 fundamental classes:
- Underlying
- Derivative
8.