Presents an overview of the financial system and how financial markets operate. Organization based on a markets analogy (i.e., capital markets are formed and operate much as other markets based on consumer needs). Focuses on innovation, globalization of financial flows, and technology (communication and information). Provides complete and current coverage of critical topics such as investment banking, derivative financial markets, and events in thrift markets. William L. Scott is Professor of Finance at Illinois State University, where he teaches undergraduate and graduate courses in financial markets and institutions. He serves from time to time as a Visiting Professor of Finance at the University of Illinois at Urbana/Champaign, where he teaches MBA courses in the management of financial institutions. Dr. Scott gains real world experience to support his teaching by functioning as a Commodities Trading Advisor (CTA). He is Managing Member and Principal Trader for EuroDoc Trading Advisors, L.L.C., which positions interest rate futures contracts that trade at the Chicago Mercantile Exchange. He holds a Ph.D. from the University of Houston (1971).