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SEC: The abbreviation for Securities and Exchange Commission, which is a federal government agency that regulates the trading of corporate stock to protect investors against unscrupulous practices. Like a number of other federal regulatory agencies, the SEC was established in the 1930s--1934 to be exact. The impetus for its formation was to prevent investors from manipulating the stock market and to prevent other practices that contributed to the 1929 stock market crash. The SEC has all sorts of rules governing the stock market, including information disclosure, insider trading, speculation, and use of credit.
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Lesson 7: Market | Unit 4: Adjustment
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Page: 13 of 22
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Markets have a built-in self correction mechanism:- If a market is at equilibrium, it remains there.
- If a market is not at equilibrium, it moves to equilibrium.
- A market does not need someone (like government) controlling it to ensure that it reaches equilibrium.
Three price alternatives:- At equilibrium, nothing changes.
- Below equilibrium, a shortage.
- Above equilibrium, a surplus.
- By creating shortages and surpluses, non-equilibrium prices induce the price to change. These changing prices move the market back to equilibrium.
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INFLATION PROBLEMS Two notable problems are associated with inflation--uncertainty and haphazard redistribution. Inflation, especially inflation that varies from month to month and year to year, makes long-term planning quite difficult. Prices, wages, taxes, interest rates, and other nominal values that enter into consumer, business, and government planning decisions can be significantly affected by inflation. Moreover, inflation tends to redistribute income and wealth in a haphazard manner--some people win and some people lose. This redistribution might not be that desired by society, failing to promote any of the basic economic goals of efficiency, equity, stability, growth, or full-employment.
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PINK FADFLY
[What's This?]
Today, you are likely to spend a great deal of time at a flea market looking to buy either a T-shirt commemorating Thor Heyerdahl's Pacific crossing aboard the Kon-Tiki or a wall poster commemorating the 2000 Olympics. Be on the lookout for a thesaurus filled with typos.
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There were no banks in colonial America before the U.S. Revolutionary War. Anyone seeking a loan did so from another individual.
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"Many people think that if they were only in some other place, or had some other job, they would be happy. Well, that is doubtful. So get as much happiness out of what you are doing as you can and don't put off being happy until some future date. " -- Dale Carnegie
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KLCE
Kuala Lumpur Commodity Exchange (Malaysia)
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