Law of Agency: Intermediary Role and Financial Markets

This assignment delves into the concept of the law of agency, specifically highlighting the role of intermediaries. It examines how intermediaries, such as brokers, facilitate transactions by connecting buyers and sellers. The assignment emphasizes their expertise, networks, and the value they bring to various sectors, including real estate and financial markets. It provides examples of intermediaries in action, such as real estate brokers and financial institutions. The assignment also references the importance of licensing and regulatory frameworks, offering an overview of the functions and significance of intermediaries in different business contexts, including their role in connecting parties and facilitating transactions.

Running head: LAW OF AGENCY
THE INTERMEDIARY FORM TO A PROSPECTIVE CLIENT
Name of the Student
Name of the University
Authors Note

1LAW OF AGENCY
Discussion Summary
In the US, intermediaries also merged buyers and sellers without owning the commodity,
service or assets. Intermediaries are not wholesale distributors who purchase goods for selling
them again, rather they act like middle men. Typically they are paid out for a proportion of the
overall transaction.
Intermediaries are essential, often referred to as negotiators or agents, because they have
the expertise, the information, the experience and, most significantly, the network which may not
available to the buyer or seller (Crowston, Sawyer and Wigand 2015).
The intermediaries who take an active part in selling real estates are known as brokers.
The brokers have the expertise and experience of selling real estates. Throughout the lifetime an
owner can only sell three or four houses, although the broker has the ability to sell hundreds. The
reason behind it is that brokers are linked to other brokers and to a computerized network where
the information of available properties and their owners are accessible. As per the law, the real
estate agents and brokers need to have license issued by the state.
Examples: Company or individual acting as mediator to connect the parties of a business deal,
investment decision, and conciliation can be said to be an intermediary. In money markets,
financial institutions and banks provide their services as intermediaries between interest-earning
investors and debt-capital debtors (Allen and Santomero 2001).

2LAW OF AGENCY
Reference
Allen, F. and Santomero, A.M., 2001. What do financial intermediaries do? Journal of Banking
& Finance, 25(2), pp.271-294.
Crowston, K., Sawyer, S. and Wigand, R., 2015. Social Networks and the Success of Market
Intermediaries: Evidence From the US Residential Real Estate Industry. The Information
Society, 31(5), pp.361-378.