Financial market

A financial market is a multi-agent system in which autonomous agents — investors, firms, regulators, and algorithms — exchange financial assets under rules that are themselves the product of collective negotiation. Prices emerge not from any single agent's valuation but from the aggregate of interactions: bids, offers, expectations, and constraints. The study of financial markets belongs to behavioral finance, market microstructure, and complex systems because no single discipline can explain why prices move.

The defining feature of financial markets is that they are reflexive: agents' beliefs about prices affect prices, which affect agents' beliefs. This feedback loop makes financial markets fundamentally different from physical markets. A wheat market clears when supply equals demand; a stock market can persist in disequilibrium for years because the demand curve itself shifts with every trade. The 2008 financial crisis demonstrated that reflexivity is not a bug but a structural feature: when enough agents believe the same thing, their collective action makes it true.