What is OPEC????

The Organization of the Petroleum Exporting Countries (OPEC, pronounced /ˈoʊpɛk/ OH-pek) is a cartel of twelve third world countries made up of Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates, and Venezuela. OPEC has maintained its headquarters in Vienna since 1965,[2] and hosts regular meetings among the oil ministers of its Member Countries. Indonesia withdrew in 2008 after it became a net importer of oil, but stated it would likely return if it became a net exporter in the world again.[3]

OECD means ??????

The Organisation for Economic Co-operation and Development (OECD, in French: Organisation de coopération et de développement économiques, OCDE) is an international economic organisation of 33 countries founded in 1961 to stimulate economic progress and world trade. It defines itself as a forum of countries committed to democracy and the market economy, providing a setting to compare policy experiences, seeking answers to common problems, identifying good practices, and co-ordinating domestic and international policies of its members.

The OECD originated in 1948 as the Organisation for European Economic Co-operation (OEEC), led by Robert Marjolin of France, to help administer the Marshall Plan for the reconstruction of Europe after World War II. Later, its membership was extended to non-European states. In 1961, it was reformed into the Organisation for Economic Co-operation and Development by the Convention on the Organisation for Economic Co-operation and Development. Most OECD members are high-income economies with a high Human Development Index (HDI) and are regarded as developed countries (Chile being the only OECD member which is also a member in the organisation of developing countries, the Group of 77).

The OECD's headquarters are at the Château de la Muette in Paris, France.

BRIC means??????

BRIC (Brazil,Russia, India and China) refers to the Big Four countries that are deemed to all be at a similar stage of newly advanced economic development.

A very good site for knowing financial jargon

http://www.keralabanking.com/html/what_is_a_repo_rate_.html

What is floating rate???????

Any interest rate that changes on a periodic basis. The change is usually tied to movement of an outside indicator, such as the prime interest rate. Movement above or below certain levels is often prevented by a predetermined floor and ceiling for a given rate. For example, you might see a rate set at "prime plus 2%". This means that the rate on the loan will always be 2% higher than the prime rate, which changes regularly to take into account changes in the inflation rate. For an individual taking out a loan when rates are low, a fixed rate loan would allow him or her to "lock in" the low rates and not be concerned with fluctuations. On the other hand, if interest rates were historically high at the time of the loan, he or she would benefit from a floating rate loan, because as the prime rate fell to historically normal levels, the rate on the loan would decrease. also called adjustable rate.

What is basis point????

A basis point (often denoted as bp) is a unit related to the change in an interest rate, and it is equal to 1/100th of a percentage point.That is 1 bp = 0.01%

It is frequently, but not exclusively, used to express differences in interest rates of less than 1% pa. For example, a difference of 0.10% is equivalent to a change of 10 basis points (e.g. a 4.67% rate increases by 10 basis points to 4.77%).

Basis points avoid the ambiguity between relative and absolute discussions about interest rates by dealing only with the absolute change in numeric value of a rate. For example, if a report says there has been a "1% increase" from a 10% interest rate, this could refer to an increase either from 10% to 10.1% (relative, 1% of 10%), or from 10% to 11% (absolute, 1% plus 10%). If, however, the report says there has been a "10 basis point increase" from a 10% interest rate, then we know that the interest rate of 10% (the "basis", if you will) has increased by 0.10% (the absolute change) to a 10.1% rate.

What is LIBOR???

LIBOR stands for London InterBank Offered Rate, which is a guide world-wide for the rate banks use to lend to each other. In the U.S., it is usually not far off from the Fed Funds rate.

As a result of the 2007 Banking Liquidity Crisis, banks have become afraid to lend to each other, and so LIBOR has risen independently of the Fed Funds rate. The Fed is trying to lower LIBOR so banks can get back in the business of lending to each other, but it hasn't been working as well as the Fed would like. In fact, LIBOR may not return to its normal cozy relationship to the Fed Funds rate until the financial markets stabilize. (See Fed Governor Kroszner Says Credit Crisis May Not Be Over, 10/22/07)

How It Affects You

Most adjustable rate mortgages and credit card interest rates are based on LIBOR. As rates reset, the high LIBOR makes the monthly payment also higher. This will cause a financial hardship to you, if you have that type of mortgage. Even if you don't, and you pay your credit card in full each month, a higher LIBOR rate will reduce liquidity in the economy.









The London Interbank Offered Rate (or LIBOR, pronounced /ˈlaɪbɔr/) is a daily reference rate based on the interest rates at which banks borrow unsecured funds from other banks in the London wholesale money market (or interbank market). Alternatively, this can be seen from the point of view of the banks making the 'offers', as the interest rate the banks will lend to each other, that is 'offer' money in the form of a loan for various time periods (maturities) and in different currencies.

LIBOR rates are widely used as a reference rate for financial instruments such as

• forward rate agreements
• short-term-interest-rate futures contracts
• interest rate swaps
• inflation swaps
• floating rate notes
• syndicated loans
• variable rate mortgages^[1]
• currencies, especially the US dollar (see also Eurodollar).

They thus provide the basis for some of the world's most liquid and active interest-rate markets.

For the Euro, however, the usual reference rates are the Euribor rates compiled by the European Banking Federation, from a larger bank panel. A Euro LIBOR does exist, but mainly for continuity purposes in swap contracts dating back to pre-EMU times. LIBOR is an estimate and not interred in the legally binding contracts of an LLC. It is however specifically mentioned as a reference rate in the market standard International Swaps and Derivatives Association documentation, which are used by parties wishing to transact in over-the-counter interest rate derivatives.

LIBOR is used by the Swiss National Bank as their reference rate for monetary policy