Kalen Smith Kalen Smith has written for a variety of financial and business sites. He is a weekly contributor for Young Entrepreneur and has worked as a guest blogger on behalf of Consumer Media Network. He holds an MBA in finance from Clark University in Worcester, MA.
Historically, gold has played a major role in the economies of many nations. Although it is no longer a primary form of currency, gold is still a solid, long-term investment and may be a valuable portfolio addition, particularly in a bear market.
Gold was considered a universal currency for hundreds of years. Due to its recognized value worldwide, a gold standard was used as far back as the Byzantine Empire over 1,500 years ago. Until recently, in fact, gold was used as the world reserve currency.
“Cash is king” is an age-old saying often used to explain the failure of both businesses and consumer households. Without the proper amount of cash on hand, both of these entities can run into major trouble, and even be forced into bankruptcy.
Businesses must have cash on hand for various reasons, such as investing in new infrastructure and dealing with unexpected expenses. Moreover, a business’s cash flow is often cited as a key factor in its potential for long-term success. A company may have all the revenue in the world, but without the ability to generate cash, it can easily fail.
Companies will go to great lengths to maintain control of their firms and will discourage a hostile takeover at any cost. One effective strategy that companies employ is called the poison pill. This tactic involves diluting a takeover company’s ownership interest in the company they wish to acquire and making it prohibitively more expensive for them to continue to purchase shares.
Poison pills have been a popular, yet controversial move and their legality has even come into question. Their use can be beneficial or detrimental to shareholders depending on the situation. Sill, a poison pill almost always acts as a strong deterrent to anyone interested in a hostile takeover bid.
When an economy is in danger of slipping into a recession or depression, governments can employ a strategy known as quantitative easing (QE).
Quantitative easing is a monetary policy instituted by central banks in an effort to stimulate the local economy. By flooding the economy with a greater money supply, governments hope to maintain artificially low interest rates while providing consumers with extra money to spend more freely, which can sometimes lead to inflation.
The unemployment rate is a variable that economists routinely use to measure the health of the economy.
However, some people think the federal unemployment rate doesn’t accurately reflect reality. In fact, the real rate of unemployment may actually be much higher than what’s reported.
The state and federal governments calculate unemployment differently. States often measure unemployment by the number of people receiving unemployment benefits. But that, of course, can be misleading since unemployment benefits expire, leaving the unemployed without a way to be measured.
“Golden parachutes” get a lot of press, and they always sound like elite packages for high-level executives. Very few people get them, and very few people know how they work.
Companies usually reserve them for executives at the top of the organization chart, and these contracts establish an agreed-upon compensation package that the employee would immediately receive upon termination. The benefits package usually includes a list of specific terms that explain what the terminated employee will receive.
How a Golden Parachute Works
When someone is offered an executive position at a firm, the contract will often include a golden parachute clause. This clause states the amount of severance pay, stock options, and cash bonuses that he or she would get.
Bonds are often considered to be fairly safe investments, but their trading prices can endure as much fluctuation and volatility as stocks. As a result, it has become increasingly popular to take advantage of the opportunity to short sell bonds.
But what exactly causes the value of bonds to decrease and how can one go about short selling a specific bond or class of bonds?
Financial derivatives, such as stock options, are complex trading tools that allow investors to create many trading strategies that they would otherwise not be able to execute using primary securities (i.e. stocks and bonds). The practice of using derivatives to develop new strategies is an example of financial engineering and these strategies can be very profitable for investors.
One strategy that has become increasingly popular is known as the “strangle.”
The rising price of gas isn’t the only necessity that’s been gouging our wallets recently. The price of food is now the highest it has been since 1974, and the world is starting to face what could turn into one of the worst food crises in decades.
While America has typically been the land of plenty, we’ll start to feel the burden along with other citizens all over the world. Though the situation looks bleak, there are things we can do to help.
But first, let’s look at what’s caused the increase in food prices to begin with.
General Motors grew from a small company in 1908 into a corporate giant within a couple of decades. For years, people believed that GM was too big to ever go away. Investors had a lot of confidence in the company and many employees invested their life savings into it.
Everyone realized the mistake they’d made with this assumption when, in 2009, the company officially declared Chapter 11 bankruptcy. Even amidst one of the worst recessions in United States history, no one would have expected General Motors to face financial failure.
With the price of oil skyrocketing (the price recently increased by 14% in a single week), you may be wondering if now is the right time to invest in this commodity.
There are plenty of ways to get in on the oil industry. For example, you can buy stocks of oil and drilling companies. But one of the most profitable – and riskiest – investments you can make is in oil futures.
In this article, we’ll look at what oil futures are, and then discuss the pros and cons of investing in them. You can then decide if they’re a good addition to your investment portfolio.
An MBA (Masters in Business Administration) is the most sought-after graduate degree in the United States. The degree is versatile and used all over the world, and can offer a major boost to anyone’s career.
Despite its mainstream popularity, many still aren’t sure what is involved in obtaining an MBA. Some common questions include: What is required to gain admission? What kind of curriculum do these programs offer? What are some of the pros and cons of getting this degree? Are there different types of an MBAs available? Who would this degree suit best?
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