The document discusses money markets and capital markets, explaining that money markets deal in short-term financial instruments of up to one year. Money markets represent shortterm lending while capital markets allow investors to trade in stocks and bonds.You will only submit a project report this week but it should be in the lesson report format and include both the lesson material and an update on your project. Money and capital exam notes week the financial system: overview explain the functions of. Money markets involve short-term loans or borrowing; generally, the assets are detained for one year or less. It is an organized exchange market where participants can lend and borrow shortterm, highquality debt securities with average maturities of one year or less.