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Problems of Formation of Russia's Financial Market

In: Business and Management

Submitted By annamart
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Introduction In the course of this work to be the best possible detail to explore the theme " Problems of the Russian financial markets ." Financial relations are a crucial element binding system of economic relations into a coherent whole , especially in the formation and development of market relations. The financial market is to establish direct contacts between buyers and sellers of financial of resource. He is one of the most important elements of any economy , because it allows to mobilize available cash flow and efficiently distribute them among those who need them , thus contributing to the activity of economic agents and the economy as a whole. Therefore, this topic is relevant since the inception of commodity-money relations and the emergence of the state with its functions and objectives. The Russian economic science problems of financial market models and methods of its regulation serious attention . Object of research - Russian financial market . Subject of research - development of the financial market in the Russian Federation. The purpose of this coursework is to familiarize with the history of the Russian financial market , revealing its contemporary problems and prospects of development .. To do this, perform the following tasks : • master the basic aspects regarding the financial markets; • familiar with the basic concepts ; • examine the current situation on the world market; An analysis of the financial activities of the state , condition, problems and development of financial markets in Russia ;

1. Financial Markets: the nature, value, function , classification Financial market - a market in which goods act as financial resources. The purpose of financial markets is to ensure efficient accumulation of funds and implementation structures in need of financial resources. Financial markets can be classified on several grounds: - By means of maturity financial markets are divided into two groups: the money market and the capital market. - Shape the organization of cash flow financial market is divided into the credit market, the stock market, the leasing market, the market is factoring services, insurance and foreign exchange markets. - The location of the financial markets is divided into: internal or national. - To participate in the conduct of financial intermediaries transaction market is divided into the market without intermediaries and market with professional intermediaries. - Depending on the level of development of financial markets are divided into developed and developing. The financial market is a system of economic and legal relations related to the sale or issue of financial assets and turnover. The subjects of these relations are: the State, as well as those who wish to transfer to the use of available financial resources, financial intermediaries, which in a stable, well-maintained basis provide redistribution of financial resources among market participants. Individuals who invest in the activities of other market entities, buying certain financial assets referred to investors and owners of financial assets - stocks, bonds, deposits. Financial markets perform several important functions. 1. Provide such interactions of buyers and sellers of financial assets as a result of which prices are set for financial assets that balance supply and demand for them. 2. Financial markets administered mechanism foreclosure investors financial assets belonging to them and thereby increase liquidity of these assets. 3. Financial markets provide assistance finding any of the lenders (borrowers) counterparty agreements, as well as significantly reduce the costs of transactions and information costs.

1.1 Financial markets: developed and developing Developed financial markets. Developed financial markets are characterized by the following features: - Stability. - Developed legal framework governing market operations; - Streamlined functioning of the information system; - High reliability of functioning in the market of financial intermediaries; - Infrastructure, which includes the obligatory system of guarantees, insurance and investor protection; - Adequate pricing system. Emerging financial markets are characterized by: - Lack of stability. - Absence of a developed insurance system. - Inadequate infrastructure; - Low efficiency of the financial market; -Difficulty residents access to the financial markets of other countries.

2.1 General characteristics of the financial market of the Russian Federation In the first half of 2011, the Russian financial market has developed in improving the terms of trade, maintaining the positive trends in the real sector of the Russian economy. At the same time, the domestic financial market experienced the impact of external shocks. In the first half of 2011, the cost volume of financial market has increased to a lesser extent than the gross domestic product. The ratio of total financial market and Russia's GDP at the end of June 2011 decreased to 125% (the level of the end of 2009 ) with 131% at the end of December 2010 The main contribution to the dynamics of the total amount of the financial market in the analyzed period, as before, made the stock market. Supported the strengthening of the ruble interest in financial instruments. State offering investors attractive enough yield on its bonds, borrowing continued to actively expand the domestic market, as well as the first time issued ruble bonds on the international capital market.

2.2 State regulation of the financial market of the Russian Federation State regulation of the financial market of the Russian Federation carries out several structures. Market loans serviced by lending institutions , organizes the Russian Central Bank, which sets the rules of settlement in the Russian Federation and of banking operations ; licensed credit institutions , regulates and supervises the activities of credit institutions; organize wasps regulation and currency control . State regulation implements and the Federal Service for Insurance Supervision, which licenses insurance companies, performs oversight of the financial condition of insurers , develops guidelines and regulations in the field of insurance. In the control system of the Russian Federation, non-governmental structures combining professional participants - still do not play such an important role , as in developed markets. Most actively operate in the securities market self-regulatory organizations (SROs) - a voluntary association of professional market participants on a commercial basis , operating under the relevant legislation. Self-regulatory organizations may take the form of associations, trade unions, professional NGOs. The main self-regulatory organizations in the Russian securities market: the National Association of Securities Market Participants ( NAUFOR) and National Association of Government Securities Market ( NAURaG ) Professional Association of Registrars , Depositories (PARTAD ) Russian stock exchanges Union ; National Securities Market Association , Association of Bill market , etc. Russian banks combined two major unions - the Association of Regional Banks «Russia», established in 1990, and the Association of Russian Banks, formed in 1991

3. Problems and prospects of the development of modern financial market in Russia Conditions of the global financial market in 2008 compounded the deterioration of its situation and the worsening crisis in the global economy. Increasing the likelihood that the number of countries where they can survive and continue to function independent and full-fledged financial markets will be gradually reduced . In the next 10 years a few national financial markets will either become the world's financial centers , or enter the zone of influence of the existing global centers . Therefore, the presence of independent financial center in a given country will be one of the most important signs of competitiveness of the economies of these countries , the growth of their influence in the world , a prerequisite of their economic , and hence political sovereignty . In this regard, the long-term competitiveness of the Russian financial market in Russia and the formation of independent financial center can not be regarded as purely sectorial or departmental objectives. Solving these problems should be an important priority of long-term economic policy. The task of creating an independent financial center in Russia involves improving taxation on the financial market. In Collection of Legislation of the Russian Federation № 3 dated January 19, 2009 published by the Financial Market Development Strategy of the Russian Federation for the period until 2020. The aim of the strategy is the formation of an independent competitive financial center. Already discussed at the meeting of the Government 's strategy of development of insurance in Russia , approved by Railway Transport Development Strategy for the period until 2030. The table attached to the strategy (Table 1) shows the targets of financial market development .

Table 1 - Targets for financial market development
|The main indicators of financial market development strategy |2008 |2020 |
|Capitalization public companies trillion. rub |32.3 |170 |
|The ratio of market capitalization to GDP |97.8% |104 |
|Exchange trade shares trillion. Rub |31.4 |240 |
|Ratio of stock trading in shares of GDP |95.1% |146 |
|Value of corporate bonds in circulation trillion. |1.2 |19 |
|The ratio of corporate bonds outstanding to GDP |3.6% |12 |
|Investment funds, trillion. Rub. |0.8 |17 |
|Pension savings and private pension funds reserves, trillion. Rub. |0.6 |12 |
|The ratio of assets of investment funds, pension savings and private pension funds reserves to gross domestic |18% |4.2 |
|product | | |
|The annual volume of IPOs in the domestic market at market value trillion. Rub. |0.7 |3 |
|The number of retail investors in the securities market, million people |0.8 |20 |
|The share of foreign securities in the turnover of Russian exchanges % |- |12 |

Conclusion Summarizing this term paper we can conclude: 1. Financial market can be defined as a market that provides mechanisms for the creation and exchange of financial assets. In developed countries, financial markets provide some infrastructure for securities trading. The financial market is focused on mobilizing capital, lending, and cash exchange operations. The main governing body of the national financial market, the Central Bank of the country. The main function of the financial market is to mobilize funds for the purpose of organizing depositors and expand production. Other features: The efficient allocations of available resources between consumers, determining the most effective uses of financial resources, accelerate cash flow. In general, the operation of financial capital in the form of capital contributes to the formation of an effective and efficient economy because it stimulates the mobilization of available cash resources for production and distribution in accordance with market needs. 2. For successful in the financial markets need a strategy. Many investors in the market make the same mistake of abandoning the strategy worked out by them, when , in their opinion , the current market situation can turn into a good financial result . This results in the best case in a loss of income, and at worst - a loss. 3. Formation of the financial markets in Russia and are being implemented so far. Prior to 1990, full controls over financial flows in Russia are state. In the early 90s there were the first joint-stock companies to issue shares to the public, so began the first phase of development of financial markets. The outcome of which can be regarded as the appearance of all possible types of securities. Despite the many benefits to the economy, this bears the financial market, its existence in Russia due to the substantial number of drawbacks. However, the good news is that the Federal Financial Markets Service of the Russian Federation and the Government are taking strategic steps aimed at attracting investment, stability, financial transparency and improving the regulatory framework. The global financial market has become developed and widespread as a result of years of evolution. Russia forced to rapidly develop its laws. The government bond market - still the only developed segment of the financial market.

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