C.A.F. FINANCIAL PLANNING

“AN ECONOMIC FORECASTER IS LIKE A CROSS-EYED JAVELIN THROWER: THEY DON’T WIN MANY ACCURACY CONTESTS, BUT THEY KEEP THE CROWD’S ATTENTION.”
- Anonymous -

Understanding Financial Markets begins with a watchful eye on the news of the day.
 
In economics, a financial market is a mechanism that allows people to buy and sell (trade) financial securities (such as stocks and bonds), commodities (such as precious metals or agricultural goods), and other fungible items of value at transaction costs and at prices that reflect the efficient market hypothesis.

Markets work by placing many interested buyers and sellers in one "place," thus making it easier for them to find each other. An economy which relies primarily on interactions between buyers and sellers to allocate resources is known as a market economy.

In finance, financial markets facilitate the raising of capital, the transfer of risk (derivatives market) or international trade (in the currency markets) and are used to match those who want capital to those who have it.

Typically a borrower issues a receipt to the lender promising to pay back the capital. These receipts are securities which may be freely bought or sold. In return for lending money to the borrower, the lender will expect some compensation in the form of interest or dividends or the return of greater than when redeemed than given issued.

The financial markets can be divided into different subtypes: Capital markets – which consist of stock and bond markets. Stock markets provide financing through the issuance of shares of stock, and enable the subsequent trading thereof in most cases, or bond markets, which most often enable the subsequent trading thereof. Commodity markets facilitate the trading of commodities. Money markets provide short term debt financing and investment. Derivative markets provide instruments for the management of financial risk Futures markets provide standardized forward contracts for trading products at some future date. Insurance markets facilitate the redistribution of various risks. Foreign exchange markets facilitate the trading on foreign exchanges.

The capital markets consist of both primary and secondary markets. Newly formed (issued) securities are bought or sold in primary markets. Secondary markets allow investors to sell securities that they hold or buy existing securities.

“AN ECONOMIST IS AN EXPERT WHO WILL KNOW TOMORROW WHY THE THINGS
HE PREDICTED YESTERDAY DIDN’T HAPPEN TODAY.” -Laurence J. Peters

 

Market Watch
www.marketwatch.com

 
Big Charts
www.bigcharts.marketwatch.com

 
CNN Business News
www.money.cnn.com
 

Bloomberg Online
www.bloomberg.com
 

Chicago Board of Trade
www.cmegroup.com

 
Morningstar
www.morningstar.com
 

Internal Revenue Service
www.irs.gov
 

Social Security Administration
www.socialsecurity.gov

 

USA Today – Money Calculator
www.usatoday.com/money/perfi/calculators/calculator.htm