The Costs of Top Three U.S. Imports

It's almost impossible to ignore the fluctuating prices of oil and many capital goods in the U.S.. The markets can be unpredictable. For the world's largest import based economy with a gross domestic product of around $15684 billion, inflation stands as an everyday hurdle. So, what are the costs for being the world's largest importer?




Import Values:

As the top import of the U.S., crude oil and other industrial products account for about 30% of import costs in the economy. The U.S. pays around $36000 million annually for crude oil alone. Capital goods such as automotive vehicles and parts including engines take another 24%.

Then, Consumer goods such as food products account for another 12% of import costs. Many food products consumed in the U.S. come from Mexico, one of the main exporters to the U.S..


Gross Domestic Product:

With a gross domestic product as large as the annual total for the United States, national income and output must remain stable. An indicator of the sum of the value of imports added at every stage of production in all industries, the GDP for the U.S. aids in the forecasting of market activity.

The market controls prices. The economy guarantees the distribution of goods and services.


Issues:

Is it reasonable to expect a decline in imports and GDP in the future? What are the effects of a decline? Who will be the next largest importer?








                                                                    SOURCES:
                                      -http://www.tradingeconomics.com/united-states/imports
                                      -http://www.bls.gov/news.release/pdf/ximpim.pdf

                                                                    KEYWORDS:
                                                imports; capital goods; gross domestic product

Investing Ideas: Three Picks from the Nasdaq Index

You might be entertaining doubts about the stability of the U.S. economy after hearing about the government lockout. Some of the largest market sectors continue to slow down as we approach the beginning of a new business year. Expect a sudden pickup.





Thriving Industries:

In spite of the lockout, some industries stand out as top earners on the Nasdaq index. Especially, the mini-Computer and Wireless equipment industries have a steady grip on the respective market sectors.

Steady gains keep both industries moving forward. The holidays should push customers into the shopping mode as computer or wireless owners look to upgrade. An investor studying the index should notice several companies from the mini-Computer and Wireless industry in the Top 100 stocks on the index.


The Picks:

For under $50 a share, an investor would be able to purchase stock in the suggested stock picks. After comparing price-to-earnings and market capitalization information for the stocks listed below, I suggest investors consider:

• Hewlet Packard
• Best Buy
• Arc Wireless

Although the companies are not always the biggest gainers, your investment would remain safe in these companies. The numbers never lie. The brands are familiar.

Tips:

Complete research on individual companies by visiting the Nasdaq.com official website. Compare historical data on the suggested industries to determine the best time to buy.






                                                        

                                                                 SOURCES:
                                    -http://www.nasdaq.com/markets/barchart-sectors.aspx
                                    -http://www.bloomberg.com/quote/CCMP:IND

                                                                 KEYWORDS:
                                                market sectors; index; industry
               

Exploring 3 Types of Prime Rates

Whether you are investing in a treasury note or securing a mortgage loan, finding the best prime rate for you should be a top priority. It's simple. A 20 minute online search along with info from a bank official will help you choose the best prime rate for your purpose. So, what's the difference in the rates?



Comparing Prime Rates:

To begin comparing prime rates a borrower should understand the rates that are available on the market. Primarily, there are three main rates available:

• Wall Street Journal
• Federal Discount Rate
• Federal Funds Rate

Of the three rates, the Federal Funds Rate carries the most significance. It influences interest rates and the economy. The Federal Funds Rate ensures the costs associated with overnight lending and determines returns of bank deposit products, your money market and regular savings accounts, etc.  Still, both the Federal Discount Rate and the Federal Funds Rate affect the quoted Wall Street Journal Rate in the long run.                



On Treasury Notes:

So, there really is a link to the prime rates on mortgages and interest bearing treasury notes. Long-term treasury notes that exceed a maturity of more than two years yield returns based on the Federal Funds rate.

Comparing the rates, you will notice that the interest does not fluctuate often. Predictability encourages investors to purchase longer term notes.




Issues:

If you are interested in knowing more specific formulas for determing yields on treasury notes or borrowing costs of mortgages, you should speak to a bank official. Mention the Federal Funds rate for more information.








                                                                     SOURCES:
                                -http://www.bankrate.com/rates/interest-rates/prime-rate.aspx
                                -http://www.treasury.gov/

                                                                       KEYWORDS:
                                                     prime rates; treasury notes; mortgages

Notes from A Fundamental Analysis of the Euro and Dollar Exchange

When it comes to deciding on a better move in a currency exchange, predicting the direction of the market becomes important. Especially, completing a fundamental analysis of the U.S. markets to determine the value of the Euro and Dollar exchange gives traders an advantage. It pays.





Determinants of Price Movement:

Often times predicting the price movement of markets like the New York Stock Exchange or Dow Jones, includes focusing in on central bank policy from the Fed, socieal pressures like unemployment, or even natural disasters as was the case during Hurrican Katrina. Deciding to make big moves after relevant economic releases clears the path for greater expectations in a trade.

A "fundamental" trader would use a forecast of the U.S. GDP to determine if he or she should invest more during a given business cycle. Charts and graphs would provide more informed suggestions on which quarter to use.


Ending the Year:

Considering the best time to enter or exit a currency exchange stays as important as deciding which exchange will be best. For instance, some traders decide not to participate in end-of-the year trading when the holidays influence the markets.

But some choose to use the last quarter as a guide. They should focus on market capitalization if they want to get the most out of an end-of-the year trade. Studying to find the best exit point and setting a reasonable limit will also help.


Tips:


Remember the goal of a fundamental analysis is to only "predict" the conditions surrounding an exchange. You want to determine why a certain currency behaves under the conditions. You don't want to assign an actual monetary value on a trade.






                                                                  SOURCES:
                                            -http://www.forex.com/intro-fundamental.html
                                            -http://www.forex.com/latest-forex-research.html

                                                                   KEYWORDS:
                                              fundamental; central bank policy; price movement


 

Investing Ideas: A Few Stocks to Buy around $25

Some investors focused on the strength of the U.S. dollar use market indicators like stock rank to decide on a good buy or sell. As all investors know, the market changes weekly and keeping up with the reports on top ranking stocks leads to significant returns. Analysts guarantee success. Just in case you're interested here's three stocks worth buying that won't hurt your wallet.

Top Sectors:

First, if you take a close look at the reports you will find three sectors earning almost 50% of the market's profits. Investors in the Information Technology, Financial, and Health Care sectors enjoy returns in the billions and have some stability for future projects. Especially, the Information Technology industry leads the market with about 20% of the profits.

Giants like Yahoo! and Google keep the industry moving as newcomers like Facebook and Twitter settle in for the long haul. No analyst can predict a definite end to America's need for technology. Count on investing in the sector 20 years from now.

The Picks:

To maximize profits an investor should consider buying into Yahoo!, Pfizer, and Wells Fargo. With impressive stock rankings the three picks promise to deliver with a minimum investment. Rankings provided by Standard & Poor 500 and other markets give in-depth analyses of the companies so you have the info.

The published prices for the stocks fall between $25-$40. You won't even think twice about the initial investment after you receive the returns from these stocks.

Tips:

Remember to keep your portfolio diversified so that you protect your investments. Placing all of your capital into one sector will impede returns if the one sector falters after a political or economical crisis. Keep an eye on the other industries trailing to the top sectors; a few are not far behind in profits. Also, consider using an online broker. Many brokers provide user-friendly interfaces which report current market news hourly.

                                                                   Suggested Sites:
                                         -http://www.standardandpoors.com/ratings/ratings-actions

                                        -http://www.morningstar.com/Cover/Stocks.html

                                                
                                                     
                                 

Investing Ideas: Checking Accounts That Pay Interest

Every so often you find a deal that you want to pass on to your friends. Checking accounts which pay interest when you keep the required available balance happens to be a deal worth passing on. It's a winning situation. Push your dollar further with an interest bearing account.


Types of Accounts:

Basically, banks group these checking accounts into two different groups: rewards checking or plain interest bearing accounts. Although both accounts pay you, rewards checking accounts go a little further to grant you the benefits of banking. For instance, rewards checking accounts bear higher interest rates than plain interest bearing accounts; guaranteed interest rates start above 2% APY on rewards checking. Also, banks encourage participation in community activities like high school sports and other civic events. You may find a bank in your community which gives passes to some events for rewards account holders.


vs. CDs:

Which ever you decide works for you, remember that interest bearing checking accounts exist to encourage consumers to use electronic payments. You will be required to make at least 12 debit purchases each billing cycle, pay bills online, and maintain a minimum required balance. Still, rewards accounts may be better than cds which penalize the consumer for withdrawals prior to maturity dates and are less liquid than demand accounts.












References:
-http://www.money-rates.com/rewardschecking.htm
-http://www.bankrate.com/brm/news/chk/20071105_reward_checking_a1.asp

Politics of the Dollar: Start Up America

Fortunately novice entrepreneurs can continue big successes as a result of the Obama administration. Demonstrating how politics maintain balance in the economy, the Start Up America effort promotes redistribution of funds for smaller businesses.


The Administration:

With gifts from public and private investors, the Start Up America program targets small businesses interested in gaining better access to capital and education from larger corporations. A joint effort begins. Administrators from larger corporations like AOL and Johnson and Johnson's help to remove barriers to lucrative start ups and collaborate with small businesses in under represented communities. Help not only comes from corporations, but universities and foundations as well contribute to the success of new business.


Location, Location, Location:

If you live in the states of Ohio, Indiana, Michigan, Minnesota, or New York and have interest in starting up a new business, contact your district Small Business Administration office for information. Or visit the Small Business Administration official website. Many of the corporations and foundations are sponsoring matching programs for start ups in your area. Don't let this opportunity pass you by. Investors are waiting to hear your ideas. Please feel free to leave comments or suggestions.

































REFERENCES:
-http://www.sba.gov/startupamerica

-http://www.whitehouse.gov/startup-america-fact-sheet

Employers Cutting Back: Are You O.K.?

Take a minute to think about your current employment. Do you feel more pressure to perform for less pay? Do you notice some co-workers have not shown up in a while? Particularly, if you work in the financial or retail sectors, you may want to ask around about the latest layoffs. It may be time for a change.


Employment Outlook:

 For now leading the way with the most layoffs, future employment for the financial sector looks bleak. Major financial employers, Bank of America and Citigroup plan to cut over 40,000 employees in a few months. While T-Mobile, in the telecommunications sector plans to layoff less than 1,000 employees. Also, some retailers are suiting up to make cuts to their payroll soon. Be surprised if more cuts do not come in the next months.


Consumer Confidence:

Generally speaking, the employment outlook for the next quarter of this fiscal year looks somewhat dim. In a survey conducted by the Conference Board on expectations for future job growth, participants state that they are expecting few new jobs in their current occupations and a small percentage are expecting pay raises. The Consumer Confidence report for March indicates a more than 5% decline in the index based on business and employment conditions.


Implications:

The Consumer Confidence report directly affects prices in the stock market and interest rates posted by the Fed. A 5% decline in the index holds enough significance to hurt the dollar as the public will have less of a demand for the dollar if no jobs are available. Watch out for more news on layoffs and information on the dollar. Feel free to leave comments.



References:
http://www.businessinsider.com/conference-board-consumer-confidence-march-2013-3

Four factors that affect the U.S. Dollar.

If you ever wonder about the forces that control when and how much your dollar can buy, then exploring the fiat currency system will help. A "fiat" currency system, the U.S. dollar is not backed by gold; instead consumer consumption supports the dollar.

Supply and Demand:

First of all, the laws of supply and demand manage consumer consumption so that consumers retain power in the system. The Federal reserve acts as chief distributor controlling the money supply which is represented in the form of liquid cash, small time deposits, and jumbo reserved deposits. On the other hand, foreign banks and individual traders control the demand for the U.S. dollar. Annually, banks and individuals ensure that the dollar remains the top reserved currency. On average, the dollar represents 65% of all reserved currency.


Trade Balance:

Likewise, the trade balance plays a role in the fiat currency system. As an import based economy, the U.S. economy depends on imports from trading partners like Canada and Mexico on a day to day basis in spite of the enormous trade deficit. Imports from Canada alone account for over $315 billion annually. However, the United States remains a debtor country.


Economic Reports:

To measure the performance and health of the economy, policymakers conduct monthly reports like the Consumer Confidence Report or use indexes like the Cost-of-Living Index. These reports ensure that the dollar is sustaining its value. Generally speaking, the public gets a chance to voice opinions about the unemployment rate, price of commodities, and housing stats. When things go awry in the economy, policy makers look to economic reports to make corrections.


Politics:

Aside from the other controls, politics place limits on the dollar. Especially during Election Year when the House changes from Democratic to Republican or vice versa, politics determine in which direction the dollar should flow. Checks and balances remain in tact. Even a tragedy like 9/11 can send the dollar through a downward spiral into a recession.

Issues:

Some questions to answer as we go through another decade on the fiat currency system are: how much of the negative trade balance has to be paid before we return to the Gold standard? How will the overall health of the economy change on the Gold Standard? Also, what happens when foreign banks decide to use other reserved currencies?