Exchanges, Brokers, Dealers, and Clearinghouses in Financial Markets

Explore the intricacies of financial markets in this comprehensive lecture from Yale University's Financial Markets course. Delve into the fundamental concepts of economics, contrasting resource allocation theory with the study of exchange. Gain insights into the roles of brokers and dealers, and trace the fascinating history of securities exchanges from ancient Rome to modern global markets. Examine the mechanics of trading systems like NASDAQ, and understand the impact of program trading and high-frequency trading on market stability. Investigate fairness in financial markets, exploring systems like NMS and ITS. Conclude with a discussion on dealer operations, insider information, and the Gambler's Ruin problem. This 69-minute lecture offers a rich, multifaceted exploration of the complex world of exchanges, brokers, dealers, and clearinghouses.