How Stock Market Trends Work
Inflation: Inflation is a rise in prices across the board. Inflation causes your dollar cheap Canada Goose to be worth less. Inflation is the reason a car canada goose outlet sale costs $7,000 in 1981 and $17,000 in 2001. Over the long term, inflation canada goose outlet store uk is good, because it means consumers are canada goose jacket outlet spending a lot of money the economy is robust. When inflation is canada goose coats too high, canada goose uk shop though, consumers pull back and spend less. After all, $5 canada goose outlet parka is a lot of money to spend on a candy bar. When consumers spend canada goose outlet in usa less, companies don’t make as much money. When companies don’t make money, investors lose confidence in those companies. Many investors sell their stock because they believe canada goose outlet uk sale the stock is worth less and is canada goose outlet black canada goose coats on sale friday only going to decrease in price. As the demand Canada Goose Coats On Sale for the stock decreases, the price of the stock decreases. canada goose uk black friday Think of goose outlet canada the canadian goose jacket canada goose outlet new york city Federal Reserve as a canada goose outlet credit card for banks. When banks have to pay a higher interest rate, they often raise their own interest rates canada goose black friday sale on loans and credit card accounts for businesses and individuals. canada goose factory outlet This means buy canada goose jacket cheap that businesses and consumers must pay higher interest on borrowed Canada Goose sale funds. This usually causes consumers to spend less and canada goose uk canada goose outlet toronto factory businesses to borrow less. When businesses don’t borrow money to canada goose outlet jackets develop that new widget, they canada goose outlet store tend to grow at a slower rate. When consumers don’t buy things official canada goose Canada Goose Parka outlet and Canada Goose Outlet Sale businesses canada goose outlet uk don’t grow, companies’ profits decrease, causing a stock price decrease. Conversely, when the Federal Reserve cuts the interest rate, investors tend to get excited. The cut means banks will be borrowing and Canada Goose Online lending more and at better rates. Businesses will grow and consumers will spend. Company profits will go up. Investors tend to canada canada goose clearance sale goose outlet online buy, buy, buy!Earnings: When Widget Co. reports profits, everyone wants a piece. Profit means the company is doing well. But maybe after a while, people grow tired of widgets and want to buy the new whatsit instead. Widget Co. reports canada unicorndesigns goose lower profits. Electricity and natural gas keep us warm, cook our food and keep canada goose black friday sale our computers happy. Therefore, the demand for energy is pretty constant. When gas prices are high, however, some people look to alternative methods of transportation carpools, public transportation, bikes, etc. Others keep paying the high price but, as a result, buy fewer consumer goods. The same goes canada goose outlet canada for crime, fraud, and domestic or political unrest. Consumers worry when CEOs steal money, terrorists kill canada goose outlet shop innocent people, or politicians are involved in serious scandals. Who knows what will happen next? Consumers save their money. Businesses make less money. Investors tend to dislike seeing their money dwindle as the price of their shares decreases.
A bull market is a rising market. In a bull market, investors are positive. The economy canada goose outlet reviews tends to be strong. Unemployment is low. Consumers are spending money, which increases business profits. When businesses profit, investors demand to share a piece of the pie they buy stocks canada goose store and hang on tight to watch the money roll in. The supply of shares, then, is low no one wants to give up their piece of the widget pie. The competition to acquire those much coveted shares Canada Goose online becomes fierce, which drives the prices up even higher. Investors take risks because they feel good about their chances of making the big bucks.
A Canada Goose Outlet bear market is a declining market. It tends to begin with a sharp drop in stock prices across the canada goose clearance board. There is usually an eye in the storm, during which buy canada goose jacket stock prices canada goose outlet online uk increase. canada goose uk outlet But the storm returns, of course, and the bear market falls and falls and falls. History has shown that a bear market tends to level out canada goose factory sale at 40 percent lower than when it began. during the Canada Goose Jackets Great Depression, might level out at about 90 percent lower [source: Incademy]. Treasury bonds: Bond interest rates tend canada goose outlet nyc to rise during bear markets, which makes for an attractive opportunity during a time of uncertaintyBuy defensive stocks: This is a cheap canada goose uk low risk way for investors to keep their money in the stock market. A defensive stock is so named because its value doesn’t fluctuate much. Utility stocks (energy, water, etc.) are popular uk canada goose outlet defensive stocks.
Leave a Reply