Psychological rather than informational differences may explain much of the
variation in financial capability reported in the FSA (2006) Baseline Survey. This
applies both to differences between individuals and across competence dimensions.
The Baseline Survey indicates that in most capability categories, scores improve with
age and the level of general education. This is consistent with the importance of
attitudes rather than teachable specific knowledge.
The challenge of alleviating poverty and improving living conditions for
the poorest populations is a formidable one. It is increasingly apparent
that such a betterment of the lot of poor people requires an effort that
spans all sectors of the economy and may not be easy to achieve through
economic growth alone. Improved access to financial services helps poor
people by enabling payment transactions that then bring them into the
In contrast to the behavioural perspective, the Thoresen Report (2008, http://www.hm-
treasury.gov.uk/media/8/3/thoresenreview_final.pdf ) is implicitly based on the view that
poor financial decisions are to a significant extent due to remediable ignorance. It
advocates that the Government should fund the widespread provision of generic financial
advice (GFA). If this leads to significant changes in behaviour, the benefits would greatly
exceed the costs. According to the Report, the net present value of the gain is of the order
Part II of this book focuses on financial markets, markets in which funds are trans-
ferred from people who have an excess of available funds to people who have a short-
age. Financial markets such as bond and stock markets are crucial to promoting
greater economic efficiency by channeling funds from people who do not have a pro-
ductive use for them to those who do. Indeed, well-functioning financial markets are
a key factor in producing high economic growth, and poorly performing financial
markets are one reason that many countries in the world remain desperately poor.
I knew I had to look for new ways to guide my children's education.
As a mother as well as an accountant, I have been concerned by the lack of financial education our
children receive in school. Many of today's youth have credit cards before they leave high school, yet
they have never had a course in money or how to invest it, let alone understand how compound
interest works on credit cards. Simply put, without financial literacy and the knowledge of how
money works, they are not prepared to face the world that awaits them, a world in which spending is
emphasized over savings....
“VantagePoint Intermarket Analysis Software,” “Market Technologies Corporation” and “ProfitTaker” are
trademarks of Market Technologies Corporation. “Synergistic Market Analysis,” “Synergistic Analysis” and
“Market Synergy” are trademarks of Louis B. Mendelsohn. “Investor’s Business Daily” is a registered trade-
mark of Investor’s Business Daily, Inc. “Technical Analysis of Stocks & Commodities” is a trademark of
Technical Analysis, Inc. “Standard & Poor’s 500” is a trademark of The McGraw-Hill Companies, Inc.
Anyone can retire as a millionaire! Consider this: If you invest $2,500 per year while earning 12 percent annual returns, then after 35 years you will have accumulated $1,079,159. But with annual returns of only 8 percent you will have just $430,792. Are these investment returns realistic over a long period of time? Based on the history of financial markets, the answer appears to be yes. For example, over the last 75 years the Standard and Poor’s index of large company common stocks has yielded almost a 13 percent average annual return.
Chapter 7 Stocks and Their Valuation
a. A proxy is a document giving one person the authority to act for another, typically the power to vote shares of common stock. If earnings are poor and stockholders are dissatisfied, an outside group may solicit the proxies in an effort to overthrow management
“VantagePoint Intermarket Analysis Software,” “Market Technologies Corporation” and “ProfitTaker” are trademarks of Market Technologies Corporation. “Synergistic Market Analysis,” “Synergistic Analysis” and “Market Synergy” are trademarks of Louis B. Mendelsohn. “Investor’s Business Daily” is a registered trade- mark of Investor’s Business Daily, Inc. “Technical Analysis of Stocks & Commodities” is a trademark of Technical Analysis, Inc. “Standard & Poor’s 500” is a trademark of The McGraw-Hill Companies, Inc.
Over the past 20 years a microfinance industry has emerged in response to the
lack of access to formal financial services for most of the world’s poor. Microfinance
institutions serve an ever-increasing number of poor clients, but the demand for
such financial services still far outstrips their capacity.
To meet this demand, most microfinance institutions plan to increase their
outreach. But rapid growth strains an institution’s systems and changes its financial
There are two parts to making a whole lot of money. The first is
earning it and the other is keeping it. The hard part is keeping it.
In this book, Loopholes of the Rich, you are going to legally learn
how to make more, keep a whole lot more, and pay less tax. One of
the things I teach is “The best thing you can do for the poor is not be one
A study in Herat province concludes that the extraordinarily high number of deaths of
women during pregnancy and childbirth are largely preventable. They are a direct
consequence of the very young marriage age for women and girls (according to UNIFEM,
54% of girls under the age of 18 are married),12 poor health and nutrition, too-frequent
childbearing, and virtually no access to gynecological and obstetrical services.
PDi and LDi are aimed at testing the incidence of adverse selection: whether firms in
poor financial health and/or facing liquidity constraints are more likely to seek and get access
to bank credit. In the case of the liquidity dummy there is no ambiguity about the causality
and the interpretation of the results in terms of adverse selection. However, in the case of the
profitability dummy, again we cannot fully eliminate the endogeneity problem because – as
mentioned before – firm’s profit/loss position may affect also bank’s decision to extend the
Who doesn’t want to be rich . . . or at least more financially secure
than they are now? As Gertrude Stein once famously said, “I’ve been
rich and I’ve been poor. It’s better to be rich.”
And so have I. From dead broke to worse. And then from okay to
affluent to more-than-enough.
Poverty reduction has two fundamental requirements: enabling the poor
and marginal groups to participate in decisionmaking about their own
development, and giving them access to capital, technology, credit, and
land, especially in the case of the rural poor. Programs to deliver these
basics must be designed with accuracy and sophistication within a frame-
work of macroeconomic social policies whose main objective is poverty
The IDB’s measures of the impact of the funds and the outstanding is-
sues and conclusions from the IDB study are summarized here.
Despite the large amount of resources that the IDB and the World Bank
have been lending to the funds, their scope is small. Only one fund in
the region, Nicaragua, spends as much as 1 percent of the gross domes-
tic product (GDP) in its fund; only three countries—Chile, Panama, and
Uruguay—spend more than US$15 per year per poor person. And the
poor countries on average spend less than US$10 a year.
In this section, we expand our discussion of the role of financial
accounting information in the operation of specific governance
mechanisms. An important example in this respect is
DeAngelo’s (1988) study of the role of accounting information
in proxy fights. She documents a heightened importance of
accounting information during proxy fights by providing
evidence of the prominent use of accounting numbers.
There is growing recognition of the large health
and productivity costs imposed by poor indoor
environmental quality (IEQ) in commercial
buildings—estimated variously at up to hundreds
of billions of dollars per year. This is not
surprising as people spend 90% of their time
indoors, and the concentration of pollutants
indoors is typically higher than outdoors,
sometimes by as much as 10 or even 100 times.
The relationship between worker comfort/pro-
ductivity and building design/operation is com-
We used descriptive statistics to examine demographic variables related to
reading as well as to compare reading outcomes for the two groups of students, those
instructed only in English and those instructed first in Spanish and then transitioned into
English reading instruction.
Breathing polluted air is unhealthy. For example, you might find it more difficult to
breathe, you might cough or your chest might feel tight.
Two main types of air pollution are ozone pollution and particle pollution.
The ozone we breathe at ground level is bad. But very high in the atmosphere (the
stratosphere) is a natural layer of ozone that is good because it helps protect us
from the sun’s harmful ultraviolet rays. A rhyme that can help you remember this is
“Ozone: Good up high, bad nearby.