Introduction to the Course: Why Finance?

Hi, my name is Gautam Kaul, and I'm really happy to do this program with you guys. It's a course that I'll talk about in this brief introductory video, and during this video I'll follow the process that I'll follow in other content related videos also. I have been at Ross School of Business - University of Michigan for many years, I've taught at many levels, and I've had a wonderful experience over the last three years offering a course in Finance that I'll talk about. But this course is called "Finance for Everyone" and as the title suggests, it's meant to be an introduction.

One of the things that happened when I offered the MOOC was that it's…it was very long, from regular standards, and it's also difficult. And there was a lot of demand for producing a course that was more accessible by people, and I try very hard by doing that without giving up rigor. So let me talk a little bit about the course

before I do that I always like to say: "Why Finance?" I mean talk about that little bit. To me finance is being, like a friend, and have enjoyed learning more and more as I go along, therefore I feel kind of privileged to share it with you. Finance unlike mentioned in the popular press, is not about money so much as the study of value and that's how I approach it. By a value I mean, the impact of any action action you may take, and typically when you take action and make a decision it's pretty, pretty much the case almost always that you make a decision today and it has an impact on the future.

And because it has an impact on the future, there are critical building blocks of Finance that are needed to understand decision-making. And value creation has two key components because of this issue of making decisions, and one of them is just study of time, meaning you make a decision today, and the impact is in the future. But the choices you make today should take that future into account, and that's a fundamental value proposition of finance, is how do you understand the value of time, and this course will be focused almost exclusively on that, because you can go really far with time value of money. And we'll use that fundamental building block to draw you in.

Another thing I like about finance is that is kind of different from many aspects of education, at least that's my view, is I really like it because it's not just conception. It is not just math, it's not just really difficult and advanced levels, it's all of the above, but it's also a set of tools that makes applications very practical. Now for example I could do a very advanced course and I'll talk a little bit about that, with tools that are more advanced, but they are still very applicable. In this course I'll be very practical, but in ways that appeal to a person who's looking at this content for the first time and wanting to use it right away.

Said again, my most important point I'm trying to make here is that decision-making happens every day, and you don't need to be a CEO head of a company, or teacher, or a individual working, say, in a school. Decision-making happens at every level all the time, and therefore I find this a fascinating way to understand the value proposition of decision-making and hopefully making good decisions at the time at which are making the decision. After the fact we all can figure out which was a good decision or a bad decision, based on data, but that's not really useful, right? You want a process that helps you understand how to make good choices at the time at which are making those choices.