In the fast paced and dynamic world of today, if something has not changed – it is Finance! Money still rules the World! The World is divided between haves and have-nots; i.e., those who have money and those who have not! After the recession of 2008, how we manage our Finances became quite important. The 2008 sub-prime crisis occurred due to the special financial instruments which few could understand! In the year 2015, with the crash in commodity prices, especially oil, countries like Saudi Arabia, Kuwait, Venezuela, etc. stared at declining oil revenues. In order to maintain their living standards, they started planning how to conserve their dwindling foreign exchange reserves and looking out for newer avenues for raising Finances! Again, in 2015, the World saw negative interest rates for the first time in Asia, starting from Japan! This unconventional monetary policy tool was used by Sweden’s Central Bank in July, 2009 for the first time. It means that for keeping money with the bank, don’t expect to receive any interest; in-fact, in reverse, one needs to pay bank for the same. And the borrowers receive interest for taking loans! All this calls for an understanding of Finance as an enabler, creator and conserver of money and fortune! The top class Finance Faculty at Institute of Management, JK Lakshmipat University, the best MBA University in Jaipur make the same understanding – a child’s play!
According to Investopedia, “Finance is the science that describes the management, creation and study of money, banking, credit, investments, assets and liabilities. Finance consists of financial systems, which include the public finance, corporate finance and personal finance, and the study of finance and financial instruments, which can relate to countless assets and liabilities.” In older times, barter system was used which took care of the payments – but, it had limitations. In modern times, currency in form of notes and coins took the place of barter system. Of late, the use of digital cash is on rise. Similarly, the simple notions of money, banking, investments, assets and liabilities have undergone a dramatic change in the last decade or so. Continue reading