As of this moment, China's Shanghai Composite is down 42.11% from its June 12th high of 5,178.19; it presently sits at 2,964.97. Even more remarkable is the fact that, since Friday of last week, the Shanghai composite has fallen 19.08%. China's momentous Monday downturn also cut the wealth of its billionaires by over $14 billion (some individuals even entered the dreaded "millionaire" club).
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America's Most Powerful Female
What is quantitative easing, and why does it matter? Will a Fed interest rate hike derail global growth prospects? How will the stock market respond to lower inflation? Will investors panic and induce a global asset selloff? These are the questions that keep Janet Yellen, America's most powerful woman, awake at night.
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Stocks To Move Even Higher
Although the stock market is shattering records, and publically traded companies are more valuable than ever, much of Wall Street fears an upcoming “market correction." The general consensus is that September 2015 will mark the end of the Fed’s Quantitative Easing program, and the beginning of interest rate hikes (also known as the Federal Funds Rate). In response, investors are hesitant to invest capital in the stock market.
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5 Terrible Tech IPOs
2014 proved to be the year of initial public offerings (IPOs). In America alone, 275 companies issued common class stock, the most since 2000 (when over 400 companies engaged in IPOs). Led by Chinese E-Commerce giant Alibaba (BABA), U.S. IPOs in 2014 raised over $85 billion in capital, an increase of more than 40% Y/Y compared to 2013. Alibaba alone raised a record-breaking $22 billion, besting both Facebook’s (FB) 2012 IPO ($16 billion) and Visa’s (V) 2008 IPO ($17.8 billion).
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Gauge Market Sentiment
For young investors, the stock market can be a scary place. Making your first investments can be daunting, to say the least. For years, young investors have searched for reliable sources to find trustworthy financial information. Clearly, you’ve done your due diligence, as you are currently reading an Economix101 article.
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The Fed's "Easy Money" Policy
Over the last several years, there has been a growing discrepancy between America's booming stock market and its sluggish macroeconomic growth. Even as GDP inches upward and the unemployment rate "declines" — due to a substantial drop in labor participation — the bull market has charged forward.
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Keep Calm & Invest
The past few weeks have seen a sharp decline in stock prices, across the board, despite strong performance by a number of reputable companies and sectors. But despite the sudden change in direction, investors should not panic. The recent pullback in the markets, so far, resembles what is known as a “correction.”
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