Task: Write a blog explaining several reasons why the US economy is in such bad shape right now.
There are a lot of factors contributing to the condition of our economy right now. The unemployment rate rose from 5 to 5.5 percent in May and the economy lost 49,000 jobs according to the New York Times. The astonishing rise in the price of oil affects our economy's condition too. A lot of people are struggling to pay all of their bills because of job losses and cannot even afford to buy their basic needs. Prices keep going up and there is a recession in our country right now.
Wednesday, June 11, 2008
Monday, May 12, 2008
Buying A Car
Task: Explain what kind of car you would buy and why. Would you buy new or used, or would you lease? What would your payment be?
I will be buying a new car rather than buying a used or lease car because with a new car, I can be 100% sure that it will be in a very good condition. I would worry a lot less with the new car than the used car because it's brand new so it doesn't have any damages yet unlike the used car. I will save some money for not taking my car almost every month to a car repair shop because some parts broke. I will buy Toyota Prius 2008 4d hatchback. I like it because it's simple but stylish. It may look small, but the well-packaged and airy interior is spacious for passengers and cargo alike. I don't want to buy a luxurious one because it's dangerous especially if I'll be staying here for quite some time in New York. What I've liked about the Toyota Prius 2008, it's hybrid. It's capable of running on electricity alone or in concert with the small gasoline four-cylinder engine, the Toyota Prius is capable of fuel economy that no current mainstream car can match. It is also affordable for me with its low base price, it fits my budget. I chose the classic silver metallic color because it looks simple yet sophisticated just like me. I will take out a bank loan to pay my car. The car costs $22,998 including the destination charge. I believe in 3-5 years I'm done paying it.
I will be buying a new car rather than buying a used or lease car because with a new car, I can be 100% sure that it will be in a very good condition. I would worry a lot less with the new car than the used car because it's brand new so it doesn't have any damages yet unlike the used car. I will save some money for not taking my car almost every month to a car repair shop because some parts broke. I will buy Toyota Prius 2008 4d hatchback. I like it because it's simple but stylish. It may look small, but the well-packaged and airy interior is spacious for passengers and cargo alike. I don't want to buy a luxurious one because it's dangerous especially if I'll be staying here for quite some time in New York. What I've liked about the Toyota Prius 2008, it's hybrid. It's capable of running on electricity alone or in concert with the small gasoline four-cylinder engine, the Toyota Prius is capable of fuel economy that no current mainstream car can match. It is also affordable for me with its low base price, it fits my budget. I chose the classic silver metallic color because it looks simple yet sophisticated just like me. I will take out a bank loan to pay my car. The car costs $22,998 including the destination charge. I believe in 3-5 years I'm done paying it.
Thursday, March 27, 2008
FED helps market go up
Task: The DOW went up over 400 points on Tuesday. Why? What did The Federal Reserve do to encourage the market to go up?
The DOW went up over 400 points on Tuesday because the Federal Reserve degraded short-term interest rate for the sixth time in the past six months on Tuesday as its continuous attempt to strengthen the economy. The central bank lowered its federal funds rate the rate it charges banks for overnight loans by three-quarters of a percentage point, to 2.25 percent, and left the door open to additional rate cuts in the months ahead though it was one of the biggest one-day rate cuts in decades, investors had been betting heavily that the Fed would cut its key rate a full percentage point in response to strong evidence that a recession has begun and to the deepening crisis on Wall Street. In order to ease tension amongst a close, not a recession in the stock market investors were expecting a full percentage point in regards to the possible recession and financial crisis that the country is facing right now that is why the Federal Reserve plans to give $200 billion dollars to the market.
The DOW went up over 400 points on Tuesday because the Federal Reserve degraded short-term interest rate for the sixth time in the past six months on Tuesday as its continuous attempt to strengthen the economy. The central bank lowered its federal funds rate the rate it charges banks for overnight loans by three-quarters of a percentage point, to 2.25 percent, and left the door open to additional rate cuts in the months ahead though it was one of the biggest one-day rate cuts in decades, investors had been betting heavily that the Fed would cut its key rate a full percentage point in response to strong evidence that a recession has begun and to the deepening crisis on Wall Street. In order to ease tension amongst a close, not a recession in the stock market investors were expecting a full percentage point in regards to the possible recession and financial crisis that the country is facing right now that is why the Federal Reserve plans to give $200 billion dollars to the market.
Wednesday, March 19, 2008
Compound Interest and The Rule of 72
Task: Explain, in your own words the concept of 'compound interest' and 'the rule of Use examples.
Compound Interest- is interest that is paid on both the principal and also on any interest from past years. It’s often used when someone reinvests any interest they gained back into the original investment. For example, if I got 15% interest on my $1000 investment, the first year and I reinvested the money back into the original investment, then in the second year, I would get 15% interest on $1000 and the $150 I reinvested. Over time, compound interest will make much more money than simple interest.
Formula:
M = P( 1 + i )n
M is the final amount including the principal.
P is the principal amount.
i is the rate of interest per year.
n is the number of years invested.
Example:
Let's say that I have $1000.00 to invest for 3 years at rate of 5% compound interest.
M = 1000 (1 + 0.05)3 = $1157.62.
You can see that my $1000.00 is worth $1157.62.
The Rule of 72- is a rule stating that in order to find the number of years required to double your money at a given interest rate, you divide the compound return into 72. The result is the approximate number of years that it will take for your investment to double.
Example:
$100 invested at 6% compounded annually would double to $200 in approximately 72 / 6 or 12 years.
Compound Interest- is interest that is paid on both the principal and also on any interest from past years. It’s often used when someone reinvests any interest they gained back into the original investment. For example, if I got 15% interest on my $1000 investment, the first year and I reinvested the money back into the original investment, then in the second year, I would get 15% interest on $1000 and the $150 I reinvested. Over time, compound interest will make much more money than simple interest.
Formula:
M = P( 1 + i )n
M is the final amount including the principal.
P is the principal amount.
i is the rate of interest per year.
n is the number of years invested.
Example:
Let's say that I have $1000.00 to invest for 3 years at rate of 5% compound interest.
M = 1000 (1 + 0.05)3 = $1157.62.
You can see that my $1000.00 is worth $1157.62.
The Rule of 72- is a rule stating that in order to find the number of years required to double your money at a given interest rate, you divide the compound return into 72. The result is the approximate number of years that it will take for your investment to double.
Example:
$100 invested at 6% compounded annually would double to $200 in approximately 72 / 6 or 12 years.
Saturday, February 16, 2008
U.S. Trade Deficit
Task: Explain what the US Trade Deficit is. Why did it go down in December 2007? What does the value of the US dollar have to do with the trade deficit falling? Why do you think that a large trade deficit is bad for the economy? In other words: why is it bad to import more goods than you export?
> The U.S. trade deficit is the difference between the cost of imports and the sales of exports that the U.S. has made rounded in billions of dollars and adjusted seasonally. The deficit fell in December of 2007 because the U.S. sold more exports and bought less imports. The reason behind the fall is that the U.S. dollar does not worth that much now and that means other countries will be after our low-price goods while our people will spend less on expensive overseas products. It is good for the economy of the US that it has a low trade deficit because if we imported more than we exported then we would be losing money.
> The U.S. trade deficit is the difference between the cost of imports and the sales of exports that the U.S. has made rounded in billions of dollars and adjusted seasonally. The deficit fell in December of 2007 because the U.S. sold more exports and bought less imports. The reason behind the fall is that the U.S. dollar does not worth that much now and that means other countries will be after our low-price goods while our people will spend less on expensive overseas products. It is good for the economy of the US that it has a low trade deficit because if we imported more than we exported then we would be losing money.
Friday, February 15, 2008
Opportunity Cost
Task: In your own words, explain what economists mean when they talk about opportunity costs. What are opportunity costs? Give some examples. And give some examples from your own life.
> Opportunity Cost simply means giving up something to get something else.
When economists talk about opportunity cost they mean that there is a decision made that they have to give up something then get something else.
For example, one would give up studying and just work and earn money, give up watching TV or playing video games and review for the Regents, etc. From my own personal experience, I gave up being with my brothers, other relatives and close friends and come here to America to continue my studies and get a decent stable job in the future.
> Opportunity Cost simply means giving up something to get something else.
When economists talk about opportunity cost they mean that there is a decision made that they have to give up something then get something else.
For example, one would give up studying and just work and earn money, give up watching TV or playing video games and review for the Regents, etc. From my own personal experience, I gave up being with my brothers, other relatives and close friends and come here to America to continue my studies and get a decent stable job in the future.
My Investment Strategy
Task: Why did you pick the stocks that you did?
> The way that I chose my stocks is the fact that I work in a drug store and I have seen hundreds of people who buy all the stocks that I have chosen and since I know that these items are really selling right now. Another thing that helped me pick my stocks is looking at the company's stock charts over five days, a month and a year or two timelines on NYTimes.com.
> The way that I chose my stocks is the fact that I work in a drug store and I have seen hundreds of people who buy all the stocks that I have chosen and since I know that these items are really selling right now. Another thing that helped me pick my stocks is looking at the company's stock charts over five days, a month and a year or two timelines on NYTimes.com.
Subscribe to:
Posts (Atom)