Why Oil is on the Boil
Measuring Risk-return value of Stock
Tuesday, July 22, 2008
Friday, July 18, 2008
Understanding Subprime Crisis
PRIMARY MARKET
The primary is that part of the capital markets that deals with the issuance of new securities. Companies, governments or public sector institutions can obtain funding through the sale of a new stock or bond issue
http://en.wikipedia.org/wiki/Primary_market
SECONDARY MARKET
The secondary market is the financial market for trading of securities that have already been issued in an initial private or public offering. Alternatively, secondary market can refer to the market for any kind of used goods.
http://en.wikipedia.org/wiki/Secondary_market
SUBPRIME LENDING
In general, subprime lending (also known as B-paper, near-prime, non-prime, or second chance lending) is lending at a higher rate than the prime rate.
Subprime lending is risky for lenders and occasionally for borrowers also, due to the combination of high interest rates, frequently poor credit histories, and potentially adverse financial situations that are sometimes associated with subprime applicants
http://en.wikipedia.org/wiki/Subprime_lending
MORTGAGE BACKED SECURITIES
Securities whose value is derived from an underlying pool of residential mortgages. The mortgages are pooled and secured against the issue of bonds. The bonds are known as MBS.
SUBPRIME CRISIS
http://en.wikipedia.org/wiki/Subprime_mortgage_crisis
http://www.thehindubusinessline.com/mentor/2007/08/27/stories/2007082750291300.htm
http://www.thehindubusinessline.com/2007/09/25/stories/2007092550550800.htm
http://www.rediff.com/money/2007/sep/06perfin.htm
The primary is that part of the capital markets that deals with the issuance of new securities. Companies, governments or public sector institutions can obtain funding through the sale of a new stock or bond issue
http://en.wikipedia.org/wiki/Primary_market
SECONDARY MARKET
The secondary market is the financial market for trading of securities that have already been issued in an initial private or public offering. Alternatively, secondary market can refer to the market for any kind of used goods.
http://en.wikipedia.org/wiki/Secondary_market
SUBPRIME LENDING
In general, subprime lending (also known as B-paper, near-prime, non-prime, or second chance lending) is lending at a higher rate than the prime rate.
Subprime lending is risky for lenders and occasionally for borrowers also, due to the combination of high interest rates, frequently poor credit histories, and potentially adverse financial situations that are sometimes associated with subprime applicants
http://en.wikipedia.org/wiki/Subprime_lending
MORTGAGE BACKED SECURITIES
Securities whose value is derived from an underlying pool of residential mortgages. The mortgages are pooled and secured against the issue of bonds. The bonds are known as MBS.
SUBPRIME CRISIS
http://en.wikipedia.org/wiki/Subprime_mortgage_crisis
http://www.thehindubusinessline.com/mentor/2007/08/27/stories/2007082750291300.htm
http://www.thehindubusinessline.com/2007/09/25/stories/2007092550550800.htm
http://www.rediff.com/money/2007/sep/06perfin.htm
Thursday, July 17, 2008
Saturday, June 21, 2008
Economic Indicators - Left to Write
It just happened that I came across some material related to Indicators of Economic well-being.
As a dabbler in Economics, I just couldnt abstain from going through it which presented invaluable insights.
We all know that GDP (Gross Domestic Product) is considered one of the chief indicator to rate how an economy is faring. GDP essentially is the value of all commodities (goods & services) produced by a nation. But, some citizens work elsewhere and few foreign nationals also contribute to GDP of India. After adjusting for this inflow & outflow values, the result is the GNP (Gross National Product). Now, few economists believe that the cost of the capital be deducted from GNP arriving at the national income or NNP (Net National Product). This NNP divided by the population gives the true Per Capita Income (PCI).
Though PCI is a widely used indicator to evaluate an economy, common sense tells us that the proper distribution of income reflects true state of the economy. Few very high income individuals can pull the PCI to a higher level. Hence, inequality (in distribution of incomes) should be taken into account. Thus, PCI adjusted for the inequality is the true measure of 'Welfare' of a society. A quantitative method for calculating welfare is given by Amarthya Sen.
Above mentioned are the economic indicators. There are few indices which try to bring out socio-economic progress in the society. Most important of these is the HDI (Human Development Index). It takes into account three parameters, namely,
1. Infant Mortality from birth
2. Standard of Living
3. Adult Literacy
Infant mortality is just relects the life expectancy. The better the living conditions the less is the infant mortality or the more is the life span.
Standard of living is derived from PPP (Purchasing Power Parity). Per Capita Incomes have to be compared if two different economies have to be compared. But they have to be converted to a common denominator (currency). Then that value is the PPP of that economy. Standard of Living reflects the material comforts that the people of an economy are enjoying. More PPP -> More comforts. Simple !!!
Human Development is not complete is one is unable read or write. Literacy leads to innovations and technological advances Thereby impacting whole socio-economic progress.
As a dabbler in Economics, I just couldnt abstain from going through it which presented invaluable insights.
We all know that GDP (Gross Domestic Product) is considered one of the chief indicator to rate how an economy is faring. GDP essentially is the value of all commodities (goods & services) produced by a nation. But, some citizens work elsewhere and few foreign nationals also contribute to GDP of India. After adjusting for this inflow & outflow values, the result is the GNP (Gross National Product). Now, few economists believe that the cost of the capital be deducted from GNP arriving at the national income or NNP (Net National Product). This NNP divided by the population gives the true Per Capita Income (PCI).
Though PCI is a widely used indicator to evaluate an economy, common sense tells us that the proper distribution of income reflects true state of the economy. Few very high income individuals can pull the PCI to a higher level. Hence, inequality (in distribution of incomes) should be taken into account. Thus, PCI adjusted for the inequality is the true measure of 'Welfare' of a society. A quantitative method for calculating welfare is given by Amarthya Sen.
Above mentioned are the economic indicators. There are few indices which try to bring out socio-economic progress in the society. Most important of these is the HDI (Human Development Index). It takes into account three parameters, namely,
1. Infant Mortality from birth
2. Standard of Living
3. Adult Literacy
Infant mortality is just relects the life expectancy. The better the living conditions the less is the infant mortality or the more is the life span.
Standard of living is derived from PPP (Purchasing Power Parity). Per Capita Incomes have to be compared if two different economies have to be compared. But they have to be converted to a common denominator (currency). Then that value is the PPP of that economy. Standard of Living reflects the material comforts that the people of an economy are enjoying. More PPP -> More comforts. Simple !!!
Human Development is not complete is one is unable read or write. Literacy leads to innovations and technological advances Thereby impacting whole socio-economic progress.
Thursday, June 12, 2008
Rafa ruffles Roger, again !
Not again, please. Nadal has conceded his 4th consecutive win on the clay. The no-emotion end to the final itself says it's become a routine for him to win on clay. No. 1 Federer once gain had to stare at the defeat. The Frech open title still allures him. His performace in the final was no where near the invicible Nadal. It was a sorry final.
Nowadays, men's tennis is a bore. Any kid on the street can surmise who wins the title. Tell me the grandslam's name, I ll tell you the winner - is the game of the day !!
Nowadays, men's tennis is a bore. Any kid on the street can surmise who wins the title. Tell me the grandslam's name, I ll tell you the winner - is the game of the day !!
IPL Magic !
Its long since I posted on this thread. Probably was too busy to write. 40+ days of non-stop entertainment in the form of IPL (Indian Premier League) is the excuse this time !! The matches were very interesting in the sense that it was mix of all nation current-generation cricketing stars.
The grand success of the IPL can primarily be attributed to the "regional-feeling" injected by the teams (read team members). Unlike ICL, the IPL teams had majority of the members who were local to the so called home ground. That gave the audience a choice and reason to take sides. This was missing in ICL and therefore the inevitable failure. No matter how much one cribs about T20 not being a pure cricket, its a hit. People are elated - watching - players for their perks - businessmen for their revenues. Do we really care if its pure cricket ??
The grand success of the IPL can primarily be attributed to the "regional-feeling" injected by the teams (read team members). Unlike ICL, the IPL teams had majority of the members who were local to the so called home ground. That gave the audience a choice and reason to take sides. This was missing in ICL and therefore the inevitable failure. No matter how much one cribs about T20 not being a pure cricket, its a hit. People are elated - watching - players for their perks - businessmen for their revenues. Do we really care if its pure cricket ??
Wednesday, January 30, 2008
Money Wins !!
BCCI does it. And Sharad Pawar's statement - This is what BCCI wanted - confirms the monopoly of Indian board in the world of cricket. The racist charges lifted against Bhajji came as no surprise, probably to any Indian. Instead he was reproved and fined for using the abusive terms. Inshort, the level of the charges were reduced. Its good for the future of Cricket, Cricket Australia and Australia. Yes, Ponting was unwise in his decision to complain against an Indian player. He must have thought of the consequences. Every ordinary Indain had a better view of the ramifications if they stamped Bhajji as a racist. Such matters need to be better settled off the field in a more amicable ambience. As some newspaper reported, BCCI - interms of revenue - is in the top 170 in India (if it were a company). How can one expect the most powerful board to sit with hands folded on such issues ? And it didn't !!
Sunday, January 27, 2008
Djo all the way
Djo - maintaining his natural game & overcoming the pressure - is the new Champion in the Game. Tsonga although had the first set, somehow lost his rythm and threw away the title. He seemed very defensive in his approach. Compared to his previous encouters with Youzhiny, Nadal he seemed to care much about the title, although he had nothing to lose. He finally is in Top-20. On the other hand Novak held his nerve, utilized his US open final appearance experience and showed extreme maturity in dealing with pressure. He emerged the true. On the whole, that was a fantastic contest, unlike the semi-finals which were one-sided. Two new forces emerged - thats the good news for Tennis fans!!
Friday, January 25, 2008
FedEx Derailed !!!
It was difficult to see R Federer going down in straight sets. But, somehow felt that atleast there was real competition for him. Novak out-classed him in many areas in the SemiFinal. His picking up of the opponents drop shots and placing them in the right areas is outstanding. Novak also used the corners of the cour very well. Roger was, however, did not use the power of first-serve to an extent Novak utlized. Roger's forehand was the worst of all. Even if the third set went Rogers way, the way he played (disappointingly) suggested that he would have been down 3-1. Unlike, in the last final where these two met Djo held his nerve in the tie-breaker to win the set and eventually the match. Probably, the youngsters are beginning to outplay the middle-aged Fed (in Tennis terms). Is this the beginning of a new era in tennis ? Well lets see !
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