US and Russian Financial markets: comparative analysis

Abstract

This article provides an analytic interpretation of the U.S. financial market development and identifies important mechanism of this market. Debt securities can spur economic growth but may also pose risks to financial stability and macroeconomic performance. US private financial sector debt increased during the COVID-19 pandemic, spotlighting the role of debt in supporting economic activity as well as the associated risks. This article covers the major trends and institutions of modern U.S. financial market. The current operating system of the American money market is being analyzed. The primary instruments of U.S. financial market are corporate and government debt securities. The major participants of American financial market are commercial and investment banks, securities firms, asset management companies, hedge funds, insurance companies, pension funds, stock and futures exchanges, credit rating agencies as well as regulatory and other public authorities. For the last decade the volume of U.S. debt securities market has increased and the structure of this market transformed. Pension funds play the leading role in US financial sector, and positions of commercial banks are decreasing. U.S. positions in global financial markets is being analyzed. Section 2 reviews the major effects of western sanctions on Russian financial market. Most foreign investors left Russian market in 2022. So the major result of western sanctions was depreciation of Russian corporate debt securities. But when special military operation will be finished the situation is likely to improve, because Russian debt securities have potential to grow. The article covers theoretical approaches to the problem of development of financial markets. Major economic drawbacks of the current financial systems are being discussed.