How does the stock market operate?
Answers: you can get really complicated in trying to explain this but here are the basics:
companies want to raise money for their businesses, so they offer to sell stocks, a small share of the company, to anyone who will buy them.- that is called an Initial Public Offering.IPO
After the initial stock is sold to someone, they in turn may resell the stock to someone else. this repeats over on over.
Sometimes the company re-buys it's own stock in the market, and some times it may sell even more stock in the market.
The price the stock is sold for (bought for) is whatever someone is willing to pay for it. If they think the company will be making money, that their prospects are bright, then they may be willing to pay a little more for it.
the organization that arranges all these sales is a stock market. there are many of them in many countries. NYSE, American, and NASDAQ are the three biggies in the USA but there are more here and in other countries.
lots more detail a the web page:
May be you can get that information at:
http://broker-valas.blogspot.com/
http://youbet-on-market.blogspot.com/
http://groups.yahoo.com/group/make_money...
well its very simple. and can get complicated if you get into it alot so i'll just leave a simple explanation.
you buy stock in something, a business. you keep the stock, possibly buying more as time goes on. the stock eventually (hopefully) becomes worth more per stock then what you paid for it. then at that point you sell your stock and make a profit. that is a simple way of explaining it.
The stock market is a place where company stocks and shares are bought and sold.
Stocks and shares are contracts issued by company's which give a "degree of ownership" of the company. Each share may only represent a small % of the company.
The reason the company issue stocks and shares is so that they can bring money into the company from the buyers, in order to reinvest and sometimes pay the directors and or employees more money.
Buy "Wall Street" on DVD.
How to know the KLCI of the previous years ?
KLCI=Kuala Lumpur Composite IndexAnswers: You can get a chart for times past 10 years here
http://www.findata.co.nz/markets/Quote.a...
I also found this site
http://www.biznewsdb.com/mw/klci_month.a...
which should allow you to look up previous prices, but it is not working for me this (Saturday) morning. You might want to try it again subsequently.
Will the current stock market collapse keep future retiring boomers from investing in stocks?
Answers: So far it's an over due correction...not a collapse.
Historically the stock market is a great investment over time.
So the younger of the boomers (age 47+/-) will feel pressure to stay with the market.
Some of the older boomers have had a great run and might want to retreat for some time. But if they are in good health and expect a long life..they'll want to participate in the next bull market.
I think calling it a "collapse" is a serious exaggeration. No, I don't think anyone who's been around for 1987's losses, and the dot com bust will be deterred from investing in the market for the long haul. Where else would people invest their money? CDs and bonds don't offer high returns, and we're seeing now that real estate investments are by no means bulletproof.
Dana (investor in my 40s)
this is a great question.
Historically a much less percentage of the population owns stocks. The media and financial firms have created this culture of equity and everyone seems to know that stock is the best long term investment, thus it becomes a self fulfilling process since more and more money are put to work in stock and thus higher prices. I am not sure if this is a good thing as in rule of thumb in the investment world is most people do not get it right... just look at Citi and ML.. the bankers themselves are losing huge sum of money.
So to question, I doubt the current situation will cause any change in people's behavior, but I doubt how things are in a longer term.
Yes. Markets move in 80 year cycles and we are on the cusp of the '29 crash. The mere fact that no one sees a crash in spite of bank and insurer stocks doing a chart waterfall pattern that should extend out the next 18 months.
What will contribute or exascerbate the downturn?
The baby boomers are approaching redemption times, Wall streeters are far to bullish on the earnings outlook and anxiety levels as of 1-19-08 are half of what they showed in 09/87 or any of the market capitulations.