25 min Complete Markets (shrink/skip to 5 minutes if needed)
2 min the spirit of the 90s
2 min forward contracts
unattainable bundle example
Resource: Read An Introduction to Complete Markets up to p. 35. Skip the discussion in terms of horse racing,
unless you are a gambler or otherwise find that terminology
illuminating. See the conclusion after the box on p. 36. Enjoy the box
on linear algebra if you like, then choose between incomplete markets
described in horse race terms or pick up on p. 42 in economic terms
with 'Some Economic Applications' up to the 'Futures and Risk
Shifting' section on 46, then skip to the
conclusion. If you don't have time, just read the conclusion.
Markets are interdependent.
A persuasive case is made that letting the markets adjust is in
some way optimal.
The math should not distract from the strong assumptions and the loaded issues that have
gone into this so far.