The Anatomy of a Stock

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If you’ve ever wanted to invest, you’ve probably heard of stocks or shares. In the simplest terms, a stock is a part of your ownership in a company. It is a claim to the underlying property of that business, namely its assets and earnings. Let’s say a company has issued 100 shares of its company. When you buy one share of that company, then you own 1/100th of that company. If the company owned only one dollar, you would own one penny of that dollar. In real world terms, what your stock or share means is you are owner of 1/100th of its debts, its assets, and its earnings. Before the internet age, this ownership was usually represented by a stock certificate. Nowadays you will hardly every see that. Instead you will see the stock appear in your brokerage account electronically. Once you own a share or stock, you are now a shareholder. Continue reading

Crisis On Infinite Markets: What the bleep is going on in the economy?

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Crisis On Infinite Markets: What the bleep is going on in the economy?

By Dr. Jerry Hionis

The famed Keynesian economist Sir John Hicks once quipped, “Investment is a flighty bird”. What Hicks meant by this statement is that stock markets, bond markets and the investors involved wherein are almost impossible to truly predict. Further, investors are a particularly finicky bunch; suffering from a self-protective heard mentality that Keynes himself labeled animal spirits. Many stock markets boom and bust merely from the collective “feeling” of investors and rarely from data driven analyses.

After what is now being labeled the Great Recession of 2007/2008, the U.S. economy has been heading back into an expansionary period where all economic indicators (baring the growing wealth and income gaps) are looking quite positive. Yet the stock market took a couple of big dives at the end of August, causing a wide range of panic levels from the academically astute to the economic laity. And while I may spend my days roaming the halls of the preverbal ivory tower of academia (my office building does have a castle-like tower design), the average Joe’s questions about the economy have yet to subside: What is the state of the economy? What is the deal with China lately? Did the stock market collapse? Should I be worried about by savings account? What about my 401K and IRA?

Therefore, in my (never ending) quest to help service the economic queries of the community, I want to present a bit of background as to, as one acquaintance put it, “what the bleep is going on in the economy”?! Continue reading

I have way too much student debt. Can I consolidate my loans?

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There are a few questions that people write to me frequently about. Here are some of them:

  • What do I do about all my student loans?
  • Can I consolidate them?
  • What does that even mean?
  • Will I pay less or more?
  • Is this permissible for me as a Muslim?

What is Debt Consolidation?

Debt consolidation is “the combining of several unsecured debts into a single, new loan that is more favorable.” In laymen’s terms, all the different loans that you are paying money on will be rolled into one big one, and you’ll make one payment. Continue reading

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