June 24, 2022

Last week, we looked at how declining stock prices are signaling to analysts that an economic recession could be on the horizon. This video looks at how the recent downturn has been especially grim for tech companies, whose shares are down significantly due to rising interest rates and global instability. 

Questions:

  1. What are some factors that have caused tech stocks to fall sharply in recent months?
  2. How have hiring decisions by companies like Facebook contributed to the tech stock downturn
Continue reading...

June 17, 2022

Yesterday, the S&P 500 dropped more than 3 percent, continuing a long decline for stocks despite investors’ hopes for a rally. This places the index down 24 percent from its previous highs in January, further pushing stocks into bear market territory. Stock markets turn from bulls to bears once they drop more than 20 percent from recent peaks, potentially indicating that the economy is headed towards a recession. In fact, if losses continue at this rate, the S&P could experience Continue reading

Continue reading...

iPhone with downward sloping stock graphShare prices plummeted across all three major stock indexes last Friday, wrapping up a terrible month that brought markets to their lowest levels since the start of the pandemic. On that single day, the Dow Jones Industrial Average fell 939 points while the S&P 500 dropped 155 points, amounting to respective contractions of 2.8 percent and 3.6 percent. Worst of all was the Nasdaq, which shrank by 4.2 percent after dropping 536 points. 

The numbers look even worse when Continue reading

Continue reading...

March 17, 2022

With inflation rising to its highest levels in 40 years, the Federal Reserve plans to take action by raising interest rates in an effort to get the money supply under control. This video looks at the ways the Fed guides the economy by influencing the federal funds rate, which then affects everything from banking policies to the housing market. 

Questions:

  1. Why is the Fed planning to raise the federal funds rate?
  2. How does the federal funds rate eventually affect Continue reading
Continue reading...

November 2, 2021

As debates in Washington about raising the debt ceiling once again make the news, this video provides a comprehensive and straightforward explanation of the U.S. national debt. Along with examining the sale of government bonds, the video also considers whether or not the country should retain the debt limit. 

Questions:

  1. How does the sale of bonds benefit both investors and the government? 
  2. Do you think the U.S. should continue to maintain a debt limit? Why or why not?
Continue reading...

January 28, 2021

Last year, the U.S. economy shrank by 3.5 percent as Americans had their lives turned upside down by the coronavirus pandemic. This made 2020 the worst year for growth since 1946 when the economy contracted by more than 11 percent in the immediate aftermath of World War II. It’s also the first time since 2009 that GDP has contracted over the course of an entire year, although the economy did begin to recover in the latter half of 2020.

“There Continue reading

Continue reading...

October 8, 2020

According to the Brookings Institution, more than 400,000 small businesses have closed during the pandemic while hundreds of thousands more remain at high risk of ceasing operations. But while many small companies have struggled, large corporations in the tech and telecommunications industries have never been better. In fact, experts fear that big companies like Amazon and AT&T could consolidate on an enormous scale over the next six months as they buy bankrupt businesses at fire sale prices.

Although corporations have Continue reading

Continue reading...

June 11, 2020

Tens of millions of Americans have filed for unemployment during the coronavirus pandemic. This historically high number increased by another 1.5 million last week as many people continue to struggle to make ends meet. Although the gradual reopening of businesses has sent some back to work, nearly 21 million Americans are still receiving unemployment benefits. All together, more than 44 million people have applied for unemployment over the course of the pandemic. 

“That means 29 percent of the workforce Continue reading

Continue reading...

April 24, 2020

For nearly two months, millions of Americans have been shut inside their homes in an effort to curb the spread of coronavirus. Many people have turned to video games as a way to pass the time, and one of the most popular titles of the last few weeks has been Animal Crossing: New Horizons. Players of the Nintendo Switch title move into their own island where they work and hunt for treasure all in an effort to buy things Continue reading

Continue reading...

August 23, 2019

Last Wednesday, the stock market tanked after the yield curve for the bond market became inverted, meaning that interest rates on short-term bonds grew higher than those paid on long-term bonds. The video below takes a look at this complicated concept and explains why the “inverted yield curve” can be a warning sign of a recession. 

Questions:

  1. What is the difference between short-term and long-term bonds? 
  2. Why do investors consider the inverted yield curve to be a potential sign of a recession?
Continue reading...