Focusing on Broad Financial Markets

You may think the foundation of the United States economy resides inside Fort Knox where the country holds its billions of dollars in gold, or possibly that it resides in our political center, Washington,

D.C. Nope, it's neither of them. The country's true economic center is Wall Street, where billions of dollars change hands each and every day, thousands of companies are traded, and millions of people's lives are affected.

Stocks are not the only things sold in the broad financial markets. Every day, futures, options, and bonds also are traded. Here's a bird's-eve view of each type of market.

Stock markets

The stocks of almost every major U.S. corporation and many major foreign corporations are traded on a stock exchange in the United States each day, and none of the money involved in these trades goes directly into the companies being traded. Today numerous local and international stock exchanges trade stocks in publicly held corporations; moreover, the only major corporations not traded are those held privately — usually by families or original founding partners — that chose not to sell shares on the public market. Forbes magazine's top privately held corporation is Cargill. Mars, Bechtel, and Publix are three others on the Forbes top 20 list. Many of the large private corporations that are not traded publicly do have provisions for employee ownership of stock and must report earnings to the SEC, so they straddle the line of public versus private corporations.