Definitions and Glossary of Economic and Financial Terms

A definition of adjustable rate mortgages, and how adjustable rate mortgages work.

ASEAN is becoming a powerful trade group that represents the countries of Southeast Asia.

What is asset allocation, and why it is important to your prosperity.

Asset-backed Commercial Paper (ABCP) is short-term corporate debt that is backed by assets such as real estate, autos and other commercial assets.

Auction-rate securities were sold as high yielding money market funds until the demand for them collapsed in October 2008.

Banco del Sur is a Latin American development bank that would like to replace the World Bank in that region.

Banking definition and role of banking in the US economy.

A definition of the Base Budget, which is that portion needed to keep the department in readiness year after year.

The definition of a bear market in the stock market.

The bee colony collapse syndrome could cost the U.S. economy $15 billion, and lead to higher food prices.

The Federal Reserve's description of the US economy.

Definition of a bilateral trade agreements, which benefit both parties.

Black Thursday in 1929 was the first clue that an historic stock market crash was about to hit.

Black Tuesday was a stock market crash that kicked off the Great Depression of 1929. What is Black Tuesday and what caused it.

When a government spends more than it makes.

Definition of the bull market in a stock market.

What stage of the business cycle is the economy in right now? If you don't know the answer to that question, read this article immediately. It will guide you to make the correct financial choices.

Definition of a call option, which gives the holder the option to buy a stock at a certain price.

A definition that shows how capital is a key component of supply.

What exactly is capital gains and the capital gains tax, and how capital gains and the capital gains tax affects you.

Collateralized Debt Obligations were one of the derivative products that helped cause the financial collapse in 2008.

Central banks manage monetary policy throughout the world, and yet they are largely misunderstood.

Certificates of deposit are a safe investment. Therefore, they offer a low rate of return.

Commercial real estate is any property owned to produce income.

What makes a country more competitive.

A competitive advantage is what distinguishes you from all others. Whether you are an employee, a business or a country, you need to have a clear competitive advantage and communicate it to your customers.

How the Consumer Financial Protection Agency works.

Consumer spending drives 70% of the U.S. economy. But what do these statistics mean? What are the current consumer trends and habits?

Consumer spending drives 70% of the U.S. economy. What are the current consumer spending trends and habits?

Definition of conventional mortgages, which include fixed rate and adjustable rate mortgages.

The definition of credit card debt, the statistics on the average credit card debt per family, what constitutes excessive credit card debt and how it influences the economy.

When a government spends more than it makes.

Deregulation is when the government seeks to allow competition in highly regulated industries, usually some form of utility.

A definition of how financial derivatives, such as options and futures contracts, are used in to trade in the stock market.

The Federal Reserve Discount Rate is the rate that the Fed charges banks to borrow from its discount window.

The Federal Reserve's discount window is how the Fed lends money overnight to banks.

The definition of a diversified investment, and its advantages.

The definition of the durable goods measured in the orders report.

Reducing cost per unit due to large size.

Definition of emerging markets.

How the U.S. Government defines employment.

What is the euro, what is the history of the euro dollar exchange rate, and what is the impact of the euro on the U.S. economy?

A definition of expansionary monetary policy and how the Federal Reserve uses it.

Fed funds, or Federal Reserve funds, are loans that banks make to each other to meet reserve requirements at Federal Reserve Banks.

The Federal poverty level defines who is officially poor in the United States.It is used to determine who receives federal subsidies.

Explains what is FIRREA, or the Financial Institutions Reform, Recovery, and Enforcement Act of 1989.

A definition of fiscal policy and how it is different from monetary policy.

Definition of fixed rate mortgages, how fixed rate mortgages work, and how they differ from other mortgages.

Definition of free trade agreements.

A definition of futures contracts, which includes commodities futures contracts and oil futures contracts.

Gross Domestic Product. How big the economy is.

Definition of GDP per capita.

What was the Glass Steagall Act, and did repeal of the Glass Steagall Act in 1999 help cause the recession ten years later?

Just like Goldilocks' porridge - an economy that is neither too hot nor too cold.

The definition of hedge.

Definition of GDP per capita.

Definition of the individual investor.

IPO, short for initial public offering, is when a company first sells shares of stock to raise funds.

A definition of interest rate, including central bank interest rates.

A definition of an interest-only loan, in which the borrower's monthly payment goes only towards the interest.

The International Trade Administration's role in the U.S. trade policies.

Why investors create a stock market bubble.

A definition that shows how labor is a key component of supply.

A statistic that follows the economic trend.

A definition of large cap stocks, which represent the largest companies.

A statistic that precedes an economic trend.

The LIBOR rate is that interest rate that banks charge each other.

The part of the U.S. Budget that is mandated by entitlement programs.

What are manufacturing jobs, and why they are important to the economy.

Mark to market is a way of a valuing assets at their current price.

An easy-to-use definition of a company's market capitalization, or market cap.

A definition of mid cap stocks, which represent mid size companies.

A definition of monetary policy and how it is different from fiscal policy.

A definition of monetary policy and how it is different from fiscal policy.

The Federal Reserve's semi-annual report to Congress on the state of the U.S. economy.

Explains what money market funds are and how money markets affect the U.S. economy.

Definition of monopoly and how monopolies used to threaten the U.S. economy by restricting free trade.

A mortgage is a specialized loan to make homeownership more accessible.

Definition of Most Favored Nation trading status.

The MSCI Indices measure global stock market performance. They include the MSCI World Index and the MSCI EAFE Index, two of the most widely quoted.

The definition of a multilateral trade agreements, which benefit everyone.

The natural unemployment rate is present in even a healthy economy.

New home builders have been hit hard by the recession.Find out how new home builders affect the economy.

The first step in buying a new home.

When ground is broken on a new home.

The Organization for Economic Cooperation and Development is a valuable research organization for understanding the economic outlook for most of the world's major economies.

A definition of off-budget revenue, which is primarily "borrowed" from the Social Security Trust Fund.

Organization of Petroleum Exporting Countries

A defintion of options, including stock options, futures options and options trading.

Definition of outperform the market and how it relates to the stock market.

Many countries peg their currency to the dollar. This means this keep the value of their currency at a certain level relative to the dollar.

A definition of pension funds and why they are important to the stock market.

Definition of GDP per capita.

What is a Ponzi pyramid scheme? Who is Charles Ponzi?

Preferred stock pays interest like a bond but also can increase in value like a stock.

Definition of price fixing, and how price fixing affects the U.S. economy

The prime interest rate is what banks charge their best customers.

What it means when they say the Federal Reserve is printing money.

Private equity is private ownership, as opposed to stock ownership, of a corporation.

Definition of profit and why it is important to the US economy.

A definition of profit margin and how it relates to profit.

Understand purchasing power parity.

Definition of a put option, also known as a put, which is an option to sell a share of stock.

The Federal Reserve's tool known as quantitative easing.

A broad term which includes residential, commercial, industrial and vacant land.

When a good economy turns bad.

The Federal Reserve requires that banks keep a certain amount of cash on hand each night.

The definition of restrictive monetary policy, and how a restrictive monetary policy slows down economic growth.

Banking definition and role of banking in the US economy.

Definition of the S&P 500, one of the most closely followed stock market indices.

Definition of the S&P rating system, how the S&P rating system is used, and why S&P rating is so important to the U.S. economy.

SARPSCO, an organization of countries bordering the Indian Ocean,

Savings and loans (S&L's) are special types of banks created to promote home ownership.

How mortgages are sold by the banks to investors.

Islamic banking follows shariah law.

A definition of small cap stocks, which represent smaller companies.

A broad definition of the stock market.

The difference between a stock market correction and a stock market crash.

A stock market crash is different from a correction, decline, and a bear market. Find out how to identify a crash, and how to tell if the stock market is about to crash. Most important, learn what to do to protect yourself from a stock market crash.

Find out the causes and effects of the Stock Market Crash of 1929.

Stock short selling is betting against a stock's price increase.

How a stock is a share of ownership of a corporation.

A swap line is an arrangement between central banks to exchange currency.

Definition of tariffs and custom taxes which are levied on imported goods.

What are TARP funds, and what is TARP money to be used for? An explanation of the TARP capital purchase program.

The President's Trade Promotion Authority allows the President to negotiate trade agreements efficiently.

How to know when the stock market is trading sideways.

Find out how the U.S. Treasury yield curve has predicted recessions.

What is the national debt clock?

A definition of unfunded mandates and how they are declining throught UMRA.

A definition of unilateral trade agreements, which benefit only one side.

Definition of volatility, or risk, of a stock or the stock market.

Describes the Volcker Rule and how it impacts the economy.

Definition of the one world currency. Explanation of the new single global currency idea.

A low yen vs strong dollar exchange rate all allowed currency traders to borrow yen at a low interest rate and invest it in a currency with a high interest rate. This was known as the yen carry trade.

What is the Chinese yuan.

Tranches were used to create more complicated derivatives by slicing them into investments with similar risk characteristics.