garvia.es

Foundations of Finance (FoF) – Session 1

NYU | January 19, 2026
Instructor: Luis Garvía Vega
Duration: 1h 23min

1. Purpose of the First Session

This first session had three main objectives:

  1. Introduce the course structure and logistics
  2. Set the intellectual and methodological tone of the course
  3. Provide a high-level overview of finance and financial instruments, without entering into technical detail yet

This was intentionally an introductory, contextual, and non-technical session. Mathematical formalism and problem-solving will start gradually in the following classes.

2. Course Infrastructure & Technology

2.1 Class Recordings and Transcripts

Transcripts, slides, and materials will be made available through the course repository.

2.2 Course Repository

You are encouraged to use it actively, not passively.

3. AI as a Learning Tool (Context, Not a Replacement)

A significant part of the session introduced how AI tools can support learning.

3.1 How AI Will Be Used

Examples shown included:

Tools referenced included:

Important:
AI is a tool, not a shortcut. Understanding remains your responsibility.

Students are encouraged to experiment responsibly with AI as a learning accelerator.

4. What Finance Is (At a High Level)

4.1 Finance Starts With Simple Questions

At its core, finance tries to answer questions such as:

5. Overview of Financial Instruments (Conceptual)

A first intuitive map of financial instruments was introduced.

5.1 Money

Money is useful not because it grows, but because it allows immediate transactions.

5.2 Loans (Debt Instruments)

This is the foundation of:

5.3 Equity (Stocks)

5.4 Derivatives (Preview Only)

Only introduced conceptually. Full treatment comes later in the course.

6. Time Value of Money (Core Concept Introduced)

One formula was intentionally introduced early, as it will appear throughout the entire course:

6.1 Fundamental Relationship

Where:

6.2 Key Intuition

This idea will be reinforced continuously.

7. Core Principles of Finance (Introduced)

Several foundational principles were stated explicitly:

  1. Investors prefer more to less
  2. Investors are risk-averse
  3. Money in the future is worth less than money today
  4. Markets are competitive
  5. No-arbitrage principle
    • If the same asset has two prices, trading will eliminate the difference

These principles will guide all models used in the course.

8. Arbitrage, Prices, and Value

8.1 Arbitrage

8.2 Price vs. Value

In equilibrium models:

This assumption is powerful, even if imperfect.

9. Markets, Interest Rates, and Real-World Context

To connect theory with reality, current monetary policy events were discussed.

9.1 Central Banking and Interest Rates

9.2 Institutional Independence

This discussion was not political, but economic: understanding interest rates requires understanding institutions.

10. Course Structure Going Forward

10.1 First Part of the Course

10.2 Second Part of the Course

11. Problem Sets and Learning Method

11.1 Problem Sets

Purpose:

11.2 How to Work

Finance is learned like a language:

The earlier you start speaking it, the better you become.

12. Tools: Calculators, Excel, AI

13. Final Messages to Students

This course is demanding, but highly rewarding.

14. Next Session

Welcome to Foundations of Finance.

Transcripción

19 de enero de 2026, 5:00p.m.

1 h 23 min 12 s

A.
English.
OK, we’ve.
It is 6 months since I start recording all my classes, but I I just record myself and I don’t record myself, but I don’t record myself in order to have my voice, my voice record.
I recorded because of the transcripts. I like the transcripts. I did the transcripts and last course, last call was like a this is going to continue me as.
Ouch.
I sorry. Do you? I didn’t understand you. Did you? Did you hear her? I’m looking for answer. I asked her how much.
And she said to those, una those.
Yes.
Ina goes Christmas.
Hey, OK.
Please go from one side I am regarding all the classes.
And and and this course, there is something new about technology.
I have full house. Kabia. My surname is Kabia. Kabia. You don’t care about this thing too much. Kabia Lopez. This is the worst webpage you will ever see.
And because of that, I know, I don’t mean as in natural as our courses and here you put foundations of finance.
These are, these are just, these are just and this is last semester. Here I got all classes and all the transcripts. For example, let me press this one.
This is 1 class where we were talking about things. These are the things we were talking about and then the transcript, the transcript and these are.
The slides, these are the slides and these are some things will change, but this is for last semester this course.
I mean, last semester I didn’t have this.
We know this here. Are you there was a move? Did you just take a picture?
Uh.
Once you are inside, let me go please.
Once you are here when you.
In the description, in the core description, you will find that you press this link and you just open.
You just open. Sorry, this is sorry.
Oh, I feel like here and you just open this. And what is this? That’s not a repository. This is not a substitutional. You can find everything in place also I will.
But I have had. I have had. I have all the files on my computer and I have screens. I run the screens and.
I am just discovering that you work with AI, with all of you use at least two, eight people.
What is the most? Have you talked your mind on that day? This is the most important, especially of them they are.
They are at home. They are worried about you. You have the escape. So this is the most important. Yeah, I heard this. I understand.
Sorry, sorry, sorry.
My surname is Garcia. So, so and you are the only man with respect. I mean, no, I mean, I’m not sure.
If I am offended anyone, please forgive me. You either do.
Perfect. Oh, and there is one more person there. OK, Deva, lease money, lease money or lease money. Lease money.
I mean, I first thing I thought about Venezuela. I’m so happy, so happy of Maduro, not Venezuela. So happy.
Then I thought about Trump. Sorry. Then I thought about politics and only because of you, Sophia, Sophia, Sophia, Sophia. Only because of Sophia, because I thought that you have US passport and you cannot vote.
And in the US, you have your own president or you have US passport. I have US passport and I’m thinking that probably all people from Venezuela will pay in order to have your status. They don’t know what’s going to happen.
You don’t know what’s going to happen. All of you know Maria Corina Machado. You know who is Maria Corina Machado. Maria Corina is the person that.
In case there were a democracy, we will be the president of Venezuela, but the problem is that Maduro is just one part of the East of the Basro. Maduro, you know Maduro, Maduro is just one part and the military has a lot of power and probably if you put Maria Corina now.
As president, you will see a civil war in Venezuela. It’s complex, absolutely complex. I have to say, sorry, sorry, it’s your president, but I am a leader.
Over before regarding Trump. I mean, I I love everyone.
We will talk about things. OK. OK.
Did you speak Chinese? Perfect. So happy. So happy. So happy. So happy. So happy. Because at the end is more than 1.5 million people. Oh.
Hey.
You say here another one. So in total we have 33 billion people in India and China, about 8 billion. So more than 1/3 of global population.
I’m from Europe, 20 Europe. The states are over still, but China and Europe has a lot of things. Who talk about China?
Hello, probably not as much as I would like.
And we will talk about our time and having someone that talk Chinese in the class is culture is culture. The more the best, the better. Yeah, I don’t know that much. Don’t worry.
Those things are happening in all classes.
I will. I use your names as a KPI, KPI, KPI, KPI, KPI, KPI, KPI. Yeah, as a KPI once I know all the names.
I am more happy. Ava, Sofia.
Sorry, not because it’s my starting. This is so in this sense I use this as an idea and also today is the first class where I have started the class or not.
In a formal way, no. But let me write. Oh, I didn’t say. I have not start with the class yet. I’m the.
There are PP and the and once I have said I told my daughter that I was going to start. I have started. This is the 5th class I start is free.
And I have told my wife, my daughter, that I was going to ask that all the classes, same auntigrams, did you see?
Did you see courses? This is courses in Spanish. Did you see choose AB or C?
Sophia. Hey.
I haven’t saw in the trust. This is the trust in.
And this is the best text.
Oh, yeah, OK.
I’m here.
I have just more right and right. Less than 5 seconds to go to the transcript or all my you see how.
Time blowing all these things up.
OK, do I have? I have. I will talk later. Anyone knows before? You know? Oh, no, that’s from.
Do you know anyone knows?
Gemini. If I say Gemini, which company you should think about? Google Alphabet. Google Alphabet. So.
The denial and dignity goes and is from the same place. Today we are not going to talk about dignity. Too much. Almost nothing. A dignity is something important, not important. It’s something new. It’s OK from December.
I mean the gravity can makes is like adding ground. I mean that there will there will be anti gravity. OK, let me come back. I will start. Do I have to start with the class?
I have already started because I have said I’m guarantee. Let me right here, OBCOBC. Anyone knows what OBC stands for?
No one?
Oh, please.
This, you know what it’s like? Something that makes your blood from lights. Sorry, lights. Have you ever heard lines? I know we see the commercials. No.
Over the counter. Over the counter for many seats. Over the counter. What does over the counter mean?
You don’t need a description. And who gives you the description? The authority is illegal. Is illegal buying something over the counter? No, it’s not illegal. It’s illegal. No, it’s not illegal.
And why you can buy medicines over the counter? Because these medicines are not valid.
There are three letters. Yeah, there are three letters.
E.
E I don’t know how to spell. Eliga. Eliga. Yes.
Legal, but OBC and regulator, yes.
Regulated. Make sense? There are three levels. Illegalities, for example, selling cocaine.
Is illegal. We don’t do legal. Then OPC.
These four soft things, knowledge, yes. And then regulated things are things that you have a supervisor, you have regulations, make sense.
I have started with the class in an OPC way. I have not proceeded with all all my things yet.
Or bureaucratical things. When talking about financial markets, we will see most of the course, most of the course we have to we deal with regulated things.
Former things, but personally.
If I have an opportunity, I will jump into all PCP’s for example.
You do and while you, but if I explain something.
Think about your high school or think about what you have done before. If you don’t understand something. If you don’t understand something, who will you ask for? You do or your teachers? Sat EPP or your teachers?
What’s up?
Is how it is.
Do I have to start with the glass? Not in a formal way, but I have to start. I have all of you in a wasaboo. I have also your attention. That is something precious also.
We have Sir, what is the most important thing you like for me at least taking care of. I have already asked the first thing I think or the second if you have talk with your mom or dad. I mean in case your mom or your dad, someone who knows.
I mean, I don’t want to understand what I’m saying, hey.
OK, let me come back here. This is the core. This is absolutely OPC and this is the first time that I am playing with this. Yep.
Hope all of the classes will start. This is I was a group of this is my dad and my wife should be somewhere closer.
I have what is? I mean, my wife should have a story.
This is C.
I don’t know why this P was not there. Oh, I have become yesterday Estonian citizen. No, no, sorry, citizen, not resident. Because I want to open a company in Spain. Sorry, Estonian. And you have. Thanks a lot.
And they asked me a picture in order to this is my picture.
I know you she will see. She will know that and let’s see whatever here. This is a was a group that I have with myself and all classes will start.
At this I will take. You can find this in breakfast.
And when you this is one year ago and these are last four and when you.
Let me share. OK, all questions will start like this. I will share the slides of the class and also I will give you a copy of the slides that we are going to see and also.
Also I will download.
Peace.
I will download this.
And I will. I will start with the slides. Is there one slide one yet who will talk about this but before let me ask to remind me to go home.
Eh, let me just say two more things. Why do I have?
That DPP year in December 2023, yes.
Cafe or Ling? Who? Where? Where do you came from? Do you speak Arab?
OK, do you know each other? I am saying this and he’s answering me back. What I’m saying, no, what you are saying to me is approach.
And what I am answering back is the response you will get from that DDD, you ask and you respond. We have gone.
Here to that that DPD 29 cloud, all these words cloud. I’m probably we will see the IPO.
Thank you of open AI during this year.
During this term and the Cooper weather 2023.
Then there were the agents. What is an agent? This girl give me this. OK, we have here an agent is you ask something to the agent.
I’m gonna show you. I’m gonna show you.
AI is A in Spanish is the opposite. In Spanish AI is AI and then this is this is not another.
That it could look like an eye and I give do things and what is I’m reality.
And the value is an agent coordinator. You open up the one file of your computer, one file that will be the whole hard disk.
You ask things. You ask category to do things.
I mean, that’s whatever you ask, and it’s absolutely amazing that today is not today. Hey, I’m here, yes.
Google Studio AI at least I discovered this and it was with Gemini 2-3 I think it was. Whatever I discovered this in several and it was so so so powerful. I’m gonna show you just right now.
Hope over who is Google Studio area.
Um.
I need once I discover this, I have passed all Christmas thinking I need infrastructure because I want we call once I see some videos.
Oh.
Like a box, box will sell in order. Once I see something, I put it in the box. Yes, I want.
We will see, but I want you to see where all things came from and Google Studio AI is something that I will use.
Probably there will be one or two times that I will use it, right? Probably I will have used it before the class or after the class and I will serve you. Yes, let me. Yes, let me go. Let me go. You move it.
Aye here, yes.
Yes.
You press this.
And you came here. Yes, this is Gemini. Here you can use nano banana that is for images, but I’m going to come here. You can start, but imagine that I don’t know their place that you don’t open directly here. You just press here here.
I’m here, AI apps.
And you are here. What is this? This is somewhere where you can put a problem.
Now I have in front of Mia. Why see? Yes.
I am gonna.
From in studies. Why? Because of my dyslexia, but I will translate it while I will write it when I will be with you.
Miss Alunos de NYU.
Uber Studio. Yeah, so.
I don’t know they.
Finance foundation of.
Thanks.
OK, I know. I mean, I’m, I’m happy. This is just context. This is context. But say I have in front of me my students. He understand or she understand that I’m a teacher. I want to show you your power for city courts.
And also.
Hey.
Toto. I mean, it’s a computer. It’s not human. But I treat the computer as a human because when treating humans, there will be a wisdom for that they are humans.
They are humans. So I I pray to people like with everyone. Include that in the AI takes the world. They will know that I am their friend. OK, so doing this portal.
I want to explain you different types of financial instance, starting by money. Sorry, money 0 risk and zero return.
Good stuff.
Swaps, features and.
Oops.
Where?
Super.
No literary. I mean, I want your heads to explode. What do you say please? OK.
This is a problem. I want to explain you money, financial, whatever. OK, I execute the problem.
And here you can see that it start working and look it’s preparing our face.
Tage index services.
Videos.
Here you can see also the code of all these.
OK. I I just want to show you one more thing. He or City has prepared this, yes.
I like it but…
Your.
In English, Hero, NM, Gambia.
That’s your name.
OK, I mean.
I have all these, but I don’t know why.
You understand what I’m saying? No, that’s equivalent. The computer is working once.
It will prepare the Spanish English version. It will change and I will go back to the beginning.
The foundation of equity, this important loans, common stock and the river, yes.
Look, he’s preparing the English one.
Huh.
There’s look here English or Spanish look.
I have great web page in seconds and I have translated into Spanish.
What is trust?
Oh, you know what is that? No. You have the euros. How much are you going to happen when you’re playing? The euros. How much are you going to lose when you’re playing or can win? The euros. If you have, if you have the euros.
You can make it. You can send it immediately. You can pay with that. You can get it. I’m talking about return, risk and equity. The euros has euros or dollars has zero return.
Zero risk and Infinity included, yes.
Let’s see what?
Hey, what Gemini has done? Legal tender and highly liquid asset like the bills in theory. OK, it has gone. I I prefer just this to talk about money. What is that? What is that?
People, we will talk about bills next day.
But did you see this?
Probably I should ask. I’m gonna, yes, I’m gonna, but I should ask.
I want to see what is this and probably this time.
I have an amount of money and no matter what the time is, it will be fixed. Make sense.
This is what I have said before, looking at this zero return and zero risk. Make sense? Then we move into another letter. If I need money, if I need money in order to accomplish a project, I will issue.
For example, votes, I assume we will talk and I will. Today is just an introductory class. I issue a loan, you give me money and in one year time I should pay back the money that you have been giving me a little return.
And with the money that you have give me, I have made 4 return. The return that I pay you, pay you back.
These are influence that help you finance.
Let me move into the second letter, Pixico loans.
Yeah. And did you see?
As time. This is time. This is that map. Profit Carlos is if it’s money, yes.
Thank you. I live with it. I always on so long markets. Oh, market. Oh, I like it. Common stocks.
No, this is not.
This is, this is not bad. This is the underlying message. I mean, I’m sorry for this.
This is how much you are willing or losing and this is.
Call Matt.
No matter what this will do, I will always have this amount of euros.
Whatever, I don’t want to be too.
Whatever, what is the stock? It’s a piece of owners, yes. And finally, very bad thieves.
This is the diagram. This is the underlying asset without a doubt. We are talking about a call option and this is the diagram, the payout of a call option, yes.
In this case, I’m not going to share with you this because I don’t like it too much. I just think about that quickly way in order to show you how to do this, but I do this as course at the end of the semester.
And one of the things that I did is.
A Black and Souls.
For a call, this is the like the one that you have already seen and for a put option, a call option and a put option. Yes, why have?
Why I have this? Because once I see, for example, imagine that I’m explaining books and before the class I want you to see something in something in a particular way. I do, yeah, quickly.
And what I’m going to do once I do it quickly. I’m going to put it in the repository. I will share. I’m with you. Just explain in a simple way, please and where. Yes, absolutely important.
This is new. We are learning Google Studio A I or the way I use Google. I am using Google Studio A I since December.
The rest will be the same way, but this is absolutely new. What does this mean that it’s not you can use it. You can. I will give extra points if you just oh Lisa, don’t this up.
And you just say it with me and I will say it with everyone. Yes, what I’m saying is what I’m focusing is that A I is so fast, so quick and personally I love it.
But there is no point in we are going to see things during this early. I mean we have the slides. We will follow what we will follow the syllabus. This class will correspond with what it should be, but one handed is AI.
And on the other hand.
There is, I have said, I’m going to say what I have said Maria Corina. You don’t need to know who is Maria Corina Machado that is.
But so probably she will be the president. She has to see no this place. I’m going to ask you about one name that is absolutely important. The name of this person is.
Really, really, really important for this cause. And I want just to look at your eyes for one second. I want to look at your eyes and see if you have heard his name before. Anyone knows what is the name I’m going to say?
No one knows the name. Start with J.
Yeah.
Do you want that paper?
You know, Paul, have you heard his name before?
Oh, you are it. No, you are Puerto Rico. They’re on power.
0011 and one. OK, I’m just going.
Sure.
Oops, I am on fire. Sorry, you know, forward.
He’s in power.
This video.
How do you? Oh, did I say you didn’t follow it? Did I say you didn’t follow it? You should think about.
And and you should think also about heated rates.
And therefore start all his speeches saying this video.
It’s from the group. I one week ago I just arrived to my house. I just going to Twitter and I say one video in the X in X Twitter X.
Of faith, I just press and he said good evening and once he said good evening.
I went… Puriti is like magic, like Puriti.
I want to start with the glass.
Good evening. On Friday, the Department of Justice served the fellow reserved with grand juries, threatening a criminal indictment related to my testimony before the Senate Banking Committee last June.
That testimony concerned in part a multi-year project to renovate the historic Federal Reserve offer to keep Congress informed about the renovation project. OK, there was a brilliant regarding buildings. Yes, yes, explain about the brilliant regarding buildings.
Let me go quick. Those are pretexts. Those are pretexts. Yes, the project is a pretext. Let me show you why made every effort to keep Congress informed about her renovation project. Those are pretexts.
The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the president.
This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions, or whether instead monetary policy will be directed by political pressure or intimidation. Yes. Have you understood what I said? This one last Monday.
Last Tuesday.
OK.
Copy.
Uh.
This video got, or at least lecture day got more than 85,000,000 visits in.
No, this is visualization. Just includer. Mr. Powell. Mr. Powell. OK, then this was last Monday. Let me show you.
Let me so if there is a response.
Oh, oh, this is. I cannot show this is five months ago. This is.
This is 6 months ago. Were the dispute or in deep regarding the religions? Yes, but I don’t want to go too big. I just want to show you. Let me just move up. I found this thing. Oh, I don’t have.
And then maybe good for myself.
Ah, you don’t weep everything. Oh, so weak. I do have for her.
That’s that’s right.
That’s right. And if not.
Big one is the one I was looking for and let’s see if they’re in the video.
Yes, so quick.
Oh, this is bad.
It’s a new value.
I don’t know why
Imagine being able to build an app with your name on it just by thinking about it. Meet based public service sometimes requires standing firm in the face of threats. I will continue to. It looks like it’s about.
This is the video where 3.1 day and it went up a little bit for a lot. So the 2.7 is now 3.1 and we’re yeah, it just went out. I haven’t heard that point, but it just happened.
And this is what I was looking for. This is last Tuesday from in Denver answering back.
So what we want, we have a lot of great months, a lot of great quarters. I want the market to go up. You announce unbelievable numbers and the market goes down because they know you’re going to do everything possible in the Fed. We’re real stiff in the Fed. It’s for another day and just last week the average.
30 A mortgage drop below 6% happens to what we want. We have a lot of great months, a lot of great quarters. I want the market to go up. You announce unbelievable numbers and the market goes down because they know they’re going to do everything possible.
In the Fed, we’re going to different, OK, what from said, from said he wants the Fed to low interest rates and not what I say once the market goes up because there are will use, I want the Fed to low interest rates.
We will see here in this course that that objective is fight against inflation. What is inflation? People want buying a lot of things and prices going up when someone what happens if you increase the rates, the price of bonds will go down. But the idea, general idea.
If people are happy, they will be pleasant, right? Because they buy, buy, buy, buy. Make sense? So if people are happy, you should increase their rates in order to calm down the economy.
Are you following me what I’m saying in there? Yes, the opposition. But as you have to check, is it possible to do all these things? I wouldn’t say it with you, but why I’m talking about this? Because this happened last Monday, the video that I have so I have said with you, there was a Rupees from last.
One day.
That Tuesday it was the reply and next week on Wednesday we will have power speech. Paul will talk as he’s talking 10 times each year.
And it’s here and you will talk and talk about interest rates, yes. And what I’m doing also is just in new context regarding what is going on now. I know that the course has just started, but I am just moving into interest rates. We will talk about interest rates later.
But I want you to have the context now in order to prepare for next week meeting.
I cannot call Paula and tell him just take the just total interest rates if he will stand in order just to accomplish my my class. I I am the one that should inform one. Make sense. OK, sorry for this.
That is part of the context. I I care a lot about benefits. I care a lot. I care a lot about program. I care a lot about Iran. Your politics. I care a lot about your politics.
But all these things are out of the scope of this book. Jerome Powell and Trump B.
He’s not out of the school. Has to do directly with our course, yes.
I care a lot about Venezuela. I’m just going quick. Sorry for it’s the first time I’m using this in public or last week. I have just said publication. This is in Spanish. Sorry.
And this is myself talking in. These are all my family. I have automatized this. These are you can find here more than 400 and let me just let me Venezuela. Here is Venezuela.
Good. I said I’ll be one for learning minutes, 12 hours in this race. Let me ask. I’m going to. All right. Can you hear me? Sorry. Here.
Forward, forward, forward, forward, forward. Let me look for how many times there is how do you call the third line, the headline, the headline. Let me see how how many times the headline.
What’s Trump? 59 Wow. Dixon and Trump, Black Rock Trump, Trump, China, Pet Trump.
Oh.
Oh, the the elephant in Trump’s room is not anything else apart from a debt of 38 billion.
The death is important, absolutely important death, valid death.
I’m so happy. I don’t know what the city board is. I don’t know what I was saying that is. So Trump, Trump, Trump, whatever.
I’m happy because I feel like Harry Potter. I have access to a lot of information in a really quick way. Oh.
Oh, also.
I have and.
What do I have here? What I was looking for? Say, range, range. This is the one I was looking for. Sorry for not going this way.
In the Fed, we have a real sniff in the Fed. They spent another day.
But they raise rates. So everyone says, oh, they announce great numbers. It’s great, great, great. And the market goes down because they immediately raise rates. Now when the market goes up, they should lower rates. You want to see 20% and 25%.
You want to see what we can do? We’ve got to go back to our old standard. Where there’s good news, the market should go up, not go down. Does that make sense to everybody? And that’s the way it used to be for most of the time. That’s the way you make your country great, where our growth potential is unlimited and it can be.
Much higher. If we went back to Saturday, we’re not doing it anymore. We’re talking about the head of the Fed of the Fed. And I want somebody that when the market is doing great, interest rates can go down because our country becomes stronger. So you view it differently, our country becomes stronger.
And therefore interest rates should go down, not up. They can’t let every rally.
ATW, yes.

  1. I am not talking. I am not talking about politics. I am just talking about from, sorry, power, speech and from response. Next day he he talk clear.
    And what he said is a mistake, big mistake. You cannot say that if the market goes up by one, then to increase interest rates, yes.
    I’m not talking about politics, I’m talking about monetary policy. And one thing is monetary policy that has to do with interest rates and another thing is fiscal policy that has to do with public space. Fiscal policy is performed by.
    The government monetary policy.
    To hear independence, what Trump is trying to do or what Powell said Trump is trying to do.
    Why I was looking for that? Because it’s so clear that it’s just made of things.
    OK, do I have to start with the class?
    You know, all these wages and not in a property. What are we going to see today? Practical information about the class, then overview of the class and some words about it.
    And this works regarding the data we have already, we have already said, I mean.
    Let me the computer is there. So last time we will start at five. We will finish at six and and office hours one hour before the class I will be here.
    But I am so flexible. You have my WhatsApp, you can send me a message, I can send you a tune, we can talk and and also I could be later, whatever.
    You already have my if if you contact if you I am sorry I I talk about you and a lot of people try not try that I I normally say no, no, no, no, no.
    We wait. I will see. I will say yes, yes, yes, yes. In two, three days I’ll just tell me how I will see your names, but there are times I’m honey cake. Honey.
    Disabled disabled disaster. Orphans are already in time. There are two books.
    Add.
    This course will not has to do too much.
    It has to do more with numbers and with maths than with discussion. We will talk about power speech because it has to do with interest rates, but most of the things.
    We will talk and discuss.
    Will have to do with maths and it’s a maths course and we will do exercises in class and the sooner you start doing exercises the better finance.
    It’s like Spanish or English.
    See? No?
    You have a unique opportunity. The sooner you start trying to talk, and in order to talk, you should stop. The sooner you start working with finance, again, finance is a lose. Finance is a lose.
    The more you try to talk, the better, yeah.
    And in this sense.
    There are financial calculators that all the exercises regarding the meter and the final can be solved with a normal calculator, but.
    There are people that think that with a financial calculator like this is in general or lower. Yes calculators. I mean Excel is mandatory and Excel will work. I will work with Excel, yes, but what I want you to think and to see.
    Is that if you for example you work here and you start using the calculator the day before the little, there are things that is more complicated.
    To understand the calculator than to study for the need. The need time will be easier than the calculator. So if you use a calculator, a financial calculator, I would not recommend you to use a financial calculator.
    See if you can get one. Yes, the sooner you start using the better.
    Now we have AI work.
    Tony, today we are. We don’t have formulas. Next Wednesday we won’t have formulas plus the rest of it. I’m going to.
    Write a formula. I say I will write a formula in order to say four or five classes time that all the days I have written this formula. Imagine that you have.
    100 euros in the bank today.
    And you receive, you receive. You have a return up thing, I say.
    10% How much are you going to have me when you’re playing?
    100 * 1 + 10 percent, so 100 make sense.
    How much are you going to have in another time? Rise to the second, yes, or rise to the third. So this is present idea and this is each other.
    Present value.
    Future value, yes, it’s equal.
    This is only just one public vehicles. There is a value is equal to future value over 1 plus the rate rise to T make sense what you have there that.
    Future value is equal to present value times 1 + r price to be.
    All of you understand this problem.
    Everything will have to do with this formula. This is called. I don’t know always this formula, but we will delegate more lessons to the whole time by your money. What is time by your money? See what happens with money during that.
    Why I have written this formula here? Because I want to tell you in five classes I don’t like. I don’t want to lie. I want all the days I have written this simple. So I’m already OK next day.
    I will see. I will have you problem set one and you should deliver this problem setting to in right space you will see when it should be delivered and.
    I’m not going to correct you. I’m going to just check if you have delivery and you don’t need to.
    Do the perfect. Why? Because there this helps you understanding things. And after doing this I will. I will ask you the day the day you should deliver this. Have you had any problem with anyone? You tell me which one I will do it in class.
    Before he say I can do it, but the point is not this exercise are not exact. You can do it in groups. You should read it. You should read it that the name of the people you have. Personally I don’t care. I’m not a policeman.
    And these exercises are or do in order make sense.
    OK, we will deal with so many languages and there is one clock. I don’t like to fight. Once I have said this disclaimer, you know how to borrow your clock.
    In water, boiling water, whatever will do. Yeah, in order to boil that road, you should.
    Increase your temperature slow and water fail.
    So OK, this is how it’s sleep and then.
    The water temperature is going to increase little by little. Don’t leave everything in the end because once you leave everything in the end, the water will be boiling. Don’t forget about the boiling. But for this I don’t know. And the others of the no.
    OK, it’s nice. I’m not gonna boil anyone, but whatever. Oh.
    There is something you should submit a report. I don’t care about this report. This report has to do just like regular.
    This there will be up in Madrid. I will do a tour next Friday and I will go to market to market Rastro. I will be this Sunday at 10:30 in the but I will next Wednesday I can give you more information.
    And whatever, there is one report that you should deliver, but if you just deliver to selfies, I will be happy.
    I time is the most valuable thing we have. You understand what I’m saying. OK, I’m so far one side present here.
    The curricular activity, whatever, for all incentive percent, the midterm is part of the grade and the final. Is this class good or just a people?
    You understand what you know. You mean that you work. I don’t have any money with any, but please you should work.
    OK, participate. Yes, before class. I will. I will this class structure. Yes, you will see that there is same information here. I’m saying midterm is fumulative.
    Because the book you you can be the meter one seat with the by you. I don’t want you to memorize anything. I want you to understand and you can understand things, but in order to understand things starting the day before.
    It is the opposite of Pakistan, yeah.
    Regarding this, I don’t know if I have uploaded yet or not or next day there is a statistics review.
    It’s upload. Oh OK, yes, I have uploaded. This is really that I will start everything from zero. I will explain everything from zero and regarding the statistics. I will not worry too much today.
    Day after day, yes, all of you should know who is your power.
    The course of line, OK, market structure, yes, we will.
    First learn whole what?
    Then we will move into portfolio selection. I will be here.
    And second part of the course will be dedicated to talk about equity, bonds and deliverance, financial instruments, one by one. So the first part of the course will be the basis.
    Probably.
    Portfolio selection and capital asset price is the most complicated of the course, but once you go through this in the middle we can forget about it and second part of the course is more there are more little things.
    That easy to understand itself by itself, but make sense.
    Finance is based in simple actions. Next day I will repeat this idea, but investors prefer more to mess if you can buy this in one place for them.
    And in another place for 20, how much would you pay? If you can sell this in one place for 20 and in another place for 10, at which price would you sell it? 20? So imagine that same.
    Product has two different prices. A product, two prices, yes, but I don’t know what a lot of people will start doing with the cheaper one. Buy what a lot of people will start with the more price selling. So what will happen with the price will go up because a lot of people will buy.
    And what will happen with the more expensive? This is called arbitrage later at the middle of the course, yes.
    But.
    Oh, I’m going to close this. I have seen my. Oh, yes, investors prefer more or less.
    Investors are risk alert, but does this mean that if you choose, you should choose between 1,000,000 for sure for sure and 50% 2 million or 0 you will we will always choose.
    1,000,000 for sure. Why instead of 50% 51?
    51 to million then it will depend on your risk profile, but if we have same choice.
    You will always. We will always prefer the one with less risk.
    Then money paid in the future worth less than the same amount paid.
    Present value is equal to future value. Sorry, future value is equal.
    I said that.
    Future value is equal to present value over 1 + R rise to B. What does it mean? It means that future value will always be lower than present value.
    Why? Because this will always be higher than one, as this is higher than one.
    This will always be higher than this. Yes, I have 100 euros today, one year 110.
    121 and so yes, so whole Max is 121 in two years today at a 10% rate 100 make sense.
    Money paid in the future worthless and financial markets are competitive. No arbitrage. I have already told you what happens if this market has two prices.
    Arbitrage and because of arbitrage markets are efficient and because of arbitrage, there are no arbitrage opportunities. Yes, price versus value. They are what is price.
    And alert value.
    Why is the difference between place and value?
    How many prices there are?
    Well, why because there are surprises, are we perhaps?
    Value is subject. Value depends on the person. If the price is higher than the value and you have the thing, what do you want to do with the me? The price is higher than the value that he has for you, what do you want to do?
    You will sell. If something has a lot of value for you and the price is lower than the value, what you will do it, you will buy it. Price and value are.
    Price is subjective. Value is subjective. Equilibrium models. Efficient market considers that price is the same as value. If a market is in equilibrium, price and value will be the same for everyone. This is a theoretical hypothesis.
    Not practical, yes, but we will work with this and it’s reasonable applied evaluation model based on when we are talking about technology.
    I think it’s changing so, so fast that we need to talk about theory. Why? Because if we don’t talk about theory, then what would happen? But I will talk about Trump. I will talk about Powell. I will talk about crypto. I will talk about a lot of things because I don’t want you just to eat here. I I just. I don’t want you just to think about.
    Theoretical things. We’ll talk about ideals, probably we’ll see open AI or SpaceX ideals. We’ll talk about a lot of things. Make sense.
    I’m Wassar Homar. Oh, this is a Nobel Prizes with Margolin.
    Yes, we will see all of them be family. We will not talk about senior. This is economical father. You know, we won’t talk about them. We will finish here, but I will try to talk about them, but.
    In an OPC way, yes, I.
    These things regarding is that things are as a semi is are happening so so we are done. Yes, it’s happened quickly. Next class we will continue working on simple ideas.
    Thanks. Any questions? No, I owe you one minute. Sorry, I will try this. I will try to avoid this habit.
    I I don’t like this one much.
    Welcome. Bye, bye.
    You smile when you hear the good evening. You you laugh. You smile when next day. Remember there are a lot of ideas.
    And good evening. If you are on finance, what do you hear? Good evening. You know that power in my head, but I don’t know how to say. That’s on. That means honey.
    Falwell is a funny guy. I mean, he’s serious and also, but once he say good evening, yeah, there’s another thing is, yeah.
    See you.

Luis Garvía Vega ha detenido la transcripción