CAPITAL
MARKET
Indonesia had experienced economic devastation that had
been built through the joints of the new order policy began crawling back
construct the foundation of the economy . International
Financial Corporation ( IFC ) classification of stocks linked to the
classification of the state . If
the country is still classified as a developing country , the market in the
country is also in a developing stage , although market shares are fully
functional and well organized .
Developed capital markets can be identified through a country , whether the country is a developed country or a developing country classified . Indicator is the per capita income of a country , which is usually included in the low to middle- income countries . But the most striking characteristic is seen the value of the market capitalization of companies listed , the cumulative trading volume , the tightness of capital markets regulation , sophistication and culture to domestic investors .
Developed capital markets can be identified through a country , whether the country is a developed country or a developing country classified . Indicator is the per capita income of a country , which is usually included in the low to middle- income countries . But the most striking characteristic is seen the value of the market capitalization of companies listed , the cumulative trading volume , the tightness of capital markets regulation , sophistication and culture to domestic investors .
Consequences of growing capital market is a small market
capitalization value . A
measure of market capitalization ratio is usually seen from the comparison with
the value of a country's gross domestic product . In
addition to the other consequences is the presence of thin trading volume (thin
trading ) caused by trade ( non - syncronous trading ) on the market . Synchronous
trading is not caused by the number of securities traded not entirely , meaning
that there is some specific time in which a securities transaction does not
occur ( Hartono , 2003) . Indonesia
which is still listed on the IFC is still a developing country with the worst
investment climate in the East Asian region . Even
with a record like that , in fact we are still considered by foreign investors
. The
fact that there are national companies with actually being in the strategic
sectors of the country , offered by some foreign institutions through the
acquisition of shares . The
presence of capital inflows as investments in general is foreign investment
should be a booster of the macro economy . The main reason for foreign
investors to move their funds to developing countries is that developing
countries have the potential untapped business entirely , as in the classic
motifs of investment to other countries . Michael
Fairbanks and Stace Lindsay senior consultant at Monitor Company express
purpose of foreign investors coming to the poorer countries is usually only see
an opportunity to attract natural resources , cheap labor and wages as the
target product or service that is not good quality .
But there are other reasons that accompany such motives ,
the striking differences with developed countries . If
we use a life cycle approach to the business of developing countries into the
category growth (growth ) than developed countries that fall into the category
of ripe (mature ) . It
means that there is the attraction of high economic growth which of course is
accompanied by a high return anyway , because economic growth is an aggregate
indicator of industry in a country . For
example, the mobile telecommunications business in Indonesia, which explored
the new solid in Java alone , while outside it still has high potential to
serve new markets .
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