[For a competitive commodity market with uncertain future prices, the rational behavior of a speculator is described and is used as a basis for the discussion of a self-fulfilling expectations equilibrium.]

Compared with the work of his contemporaries, Keynes's General Theory represented a radical change in theoretical method--from sequence analysis to the method of equilibrium. The nature of this change is discussed, together with its implications for the substance of Keynes's message and for the subsequent development of macroeconomics.

Compared with the work of his contemporaries, Keynes's General Theory represented a radical change in theoretical method--from sequence analysis to the method of equilibrium. The nature of this change is discussed, together with its implications for the substance of Keynes's message and for the subsequent development of macroeconomics.

Part 1 Principles: lending, payments and risk-taking the financial system and its technology efficiency, stability and government intervention. Part 2 Interest rates and exchange rates: interest rates, exchange rates and security prices the level of interest rates and exchange rates money, prices, interest rates and exchange rates the structure of interest rates and exchange rates. Part 3 Intermediaries: understanding financial intermediaries commercial banks the banking industry - part 1 the banking industry - part 2 near banks - thrifts, finance companies and others payments and foreign exchanges insurance pension funds and mutual funds. Part 4 Markets: understanding security markets the market for government securities the money market the capital market the mortgage market and securitization the derivatives market - futures, options and swaps. Part 5 Stability and the central bank: managing liquidity and risk the stability of the financial system deposit insurance controlling the quantity of money monetary policy.