World economics news and more: Financial Times

This business paper is strongly recommended for regular reading. Financial Times is the British newspaper, which owns 50% of the Economist’s shares and has The Wall Street Journal a direct competitor.

History

The history of Financial Times begins in January 1888 with the publication of the first four-broadsheet issue of a newspaper called London Financial. However, a month later the founders of the publication, the brothers Horatio William Bottomley and James Sheridan, renamed it Financial Times. The paper was addressed to London community of financiers. The publication quickly earned the readers’ trust, and became a kind of Bible for stockbrokers, but Financial Times had competitors. The most serious of them in Britain, was considered to be the newspaper Financial News, which appeared four years earlier and earned the fame of a fearless anti-corruption publication. In order to become distinguishable for readers, since 1893 Financial Times has been printed on orange-pink paper. For some time competitors were neck-and-neck. During this time Financial News managed to buy shares of the magazine The Economist and absorb the newspaper Financier and Bullionist, but Financial News, in spite of everything, always had the upper hand by the number of copies. In 1945 the merge of the competing publications was carried out. The new version of Financial Times then had a large circulation and journalistic talents of Financial News (and also borrowed its well-known column Lex).

Unusual "pink salmon" pages have become a calling card for Financial Times.
Unusual “pink salmon” pages have become a calling card for Financial Times.

International development

Since the 1970s Financial Times began to expand the scope of readership all over the world. 1979 marked the publication of the first issue in Frankfurt, in 1989 the newspaper appeared in Paris, in 1985 it conquered New York, and then another two dozen cities in four international editions. 1990s have become the period of new technologies. In 1995 the world saw the release of the online resource FT.com, which made it possible to deliver the news to any corner of the globe faster. The publication was noticed by the rest of the media, and in 1997, the newspaper receives one of the most prestigious awards in the world of journalism, The Newspaper of the Year by What The Papers Say. The following year, Financial Times received the award Newspaper of the Year from the British Press Awards. Having caught the trend in 2010, Financial Times became available in Bloomberg terminal, created applications for iOS, and won Apple Design Award next year. In the same year Financial Times buys the consulting agency Medley Global Advisors.

Distinctive features

The publication does not intend to focus on certain circles of society, however, the model ADGA ( FT Group know-how) shows that newspaper readers are primarily politicians and top managers of the largest financial institutions. The publication has huge credibility. Thus, the worldwide community of professional investors considers Financial Times the most reliable source of news in business and finance. The additions to the daily Financial Times are the Sunday publication FT Weekend and the magazine How to Spend It providing new business articles on real estate (houses, yachts) and luxury goods (clothing, watches, etc.). Financial Times has become a creator of several stock market indices, for example, the FTSE 100 Index, which is one of the most important stock market indicators in Europe, and the originator of annual rating of the most popular companies in several categories (FT500). The policy of Financial Times depends on the beliefs of the current editorial staff and has been changed not once since the foundation of the newspaper. Now the publication tends to perform liberal-democratic views, favouring globalization and free market. Financial Times is perhaps the most tech-savvy business publication, which is aimed at the adaptation to mobile devices and thus expanding the audience in the near future. More than a half of current circulation of 600 000 copies are paid online subscriptions.

The Wall Street Journal: best business news

The Wall Street Journal (WSJ) is one of the largest and most influential American newspapers. This is a business newspaper, published six times a week in New York by the company Dow Jones & Company. The WSJ traces its history back to 1889. In 2013 the newspaper circulation was nearly 2.4 million of copies, including about 900 thousand paid subscriptions on the Internet. There are European and Asian editions of the newspaper. The paper covers the news in business, politics, economy, finance, analytics, and culture.
The name of the newspaper directly refers to Wall Street, the street of New York and the financial centre of the United States. The newspaper itself is primarily devoted to international and American business news.

Dow Jones & Company

Dow Jones & Company was founded in 1882 by an American firm specializing in the collection and provision of financial information. During its long history, the company has maintained its reputation and the principles of work. The company’s business credo is providing reliable financial news.
At the beginning, Dow Jones & Company worked according to a simple principle. The reporters visited bank offices, betting shops and other financial institutions: they gathered news, interviews, and other useful information. Then these materials were delivered to the office by messengers, who were attached to each employee. Then the information was processed by the editor and delivered to subscribers.
In 1889 Dow Jones & Company had 50 employees. There were more and more events on Wall Street and leaflets for distribution could not accommodate the whole amount of information. July 8 1889 the first edition of The Wall Street Journal was released. The newspaper always maintained his independence and impartiality in the news.

There is always a lot of activity in the office of Dow Jones & Company.
There is always a lot of activity in the office of Dow Jones & Company.

In early May 2007, there was information in financial circles that the Australian media mogul Rupert Murdoch intends to purchase Dow Jones & Company. By the way, Murdoch’s News Corp. includes, in particular, the British newspapers The Times and The Sun, the American New York Post, about 170 other newspapers, the TV channel Fox Newsand the studio Twentieth Century Fox. Murdoch has already showed willingness to buy the company. The price of the proposed transaction was to be $ 5 billion.
When the information about the sale of Dow  Jones &Company appeared, its shares have risen in price by 60%. But the Bancroft family, which has been the owner of Dow Jones & Company  for 125 years, rejected the offer so far. One of the main reason was the reputation of Rupert Murdoch. Dow Jones & Company and The Wall Street Journal has always been advocating the independence and quality information. The newspaper journalists and the company owners fear that after the sale these principles will not be so important anymore.

WSJ in numbers and facts

Until November 2003 the newspaper had the largest circulation in the United States, but was surpassed by USA Today. In 2013 WSJ reached the first position again. Its main competitor today is Financial Times published in London, which also has several international editions.
The newspaper has won the Pulitzer Prize 39 times.
The newspaper has 85 offices in 51 countries with over two thousand employees.
In 2005, the WSJ reported on the characteristics of its average reader: about 60% work in executive teams, the average income is 191 000 dollars, and the average age is 55 years.

Magazines for business: Forbes

After opening a small but undoubtedly important business, a young entrepreneur cherishes one humble dream – to see his face on the cover of Forbes, and his name in the rankings of the most successful, wealthiest and the most powerful people of this world. How did this business magazine gain such success?

Forbes facts

The monthly magazine Forbes, which  provides an overview of finance and economics, is published by the American company Forbes Incorporated. This company also owns Wall Paper, Newsweek and other prined media. The chief editor of the magazine is Steve Forbes, who was the president of the company until the end of 2010. The magazine’s motto is “The capitalist tool”.
Forbes publishes news, interesting journalistic investigations, business sectors reviews, histories of the best enterprises, ratings of the most successful businessmen, sportsmen, performers (for a certain period). Now more than 5 million people read this journal. Forbes is the second largest business journal in the USA (according to the number of readers), the first is Business Week.

Forbes headquarters now located in Jersey City.
Forbes headquarters now located in Jersey City.

Foundation and early history

The magazine Forbes was founded in 1917 by Bertie Charles Forbes, who comes from Scotland. The name of the first edition was “Doers and Doings”. Several years later, Forbes has become one of the most popular finance journals in the US.
In 1947 the founder of magazine, Bertie Forbes, died, and his son became the vice-president of Forbes Incorporated. He tried to increase his father’s capital, but put his own political ambitions above the publishing business.
In the 1960s Forbes has become one of the most influential periodicals. Jim Michaels was the chief editor at that time. Experts say that the editorial policy of Forbes influenced greatly on the modern business journalism in that period. Other media often published flattering articles about different business structures, but Forbes conducted unbiased investigations.
In 1981, Ronald Reagan became the US president. During his reign the country experienced a rapid economic rise. In those days Forbes played an important role in social and political life, promoting its concept of national patriotic capitalism.

Forbes in the 1990s

In 1990s Malcolm Forbes died and his son, Steve Forbes, took the post of the CEO. He inherited a fortune of $ 1.4 billion and 35% of Forbes Incorporated total capital. He also received 51% of the voting shares. Stephen Forbes took over the family business. But, like his father, he tried to satisfy their own political ambitions. In 2000, while participating in the presidential campaign, he sold Forbes shares and reduced his stake to 50%.
During Steve Forbes’s editorship, the magazine started to highlight a wider spectrum of topics; issues in the Japanese and Portuguese languages appeared, covering a large audience in Asia and Latin America. In the 1990s Forbes used to publish highly informative analysis of the new online businesses, thus standing out over other business magazines. In addition, the periodical promoted the idea of income tax unification. Now this idea is applied in most countries.

Forbes now

No one knows the exact data on the turnover of Forbes Inc. and Steve Forbes’s income. Several years ago his capital was estimated at $ 400 million (excluding $ 1.4 billion, which he inherited from his father). Every year, Forbes pays himself about $ 1.2 million. Of course, it is not all his income.
Over recent years Forbes has become even more popular, influential and quoted. According to the amount of advertising, the magazine is considered to be a world leader in the media industry.

How to follow and use international trade news

Trading at the international markets directly depends on economic and political conditions in a particular country in the world. That is why one needs to monitor the news in order to make the right decisions at the currency or stock market.

Find your best source

There are dozens of different services publishing  financial news especially for traders. Simply subscribe to the appropriate newsletter or install an application in your phone and read fresh articles related to finance.

When dealing with the foreign exchange market, it is impossible to overestimate the importance of financial news. No wonder there is a concept of trading news at the currency market. Immediate reaction to a particular event in the economics of the USA or foreign countries can bring you substantial profit. It is important to learn how to quickly process information and make bold decisions. And of course, the first thing one should do is to find the best news service that will keep you informed of the latest trends.

This probably will be the most difficult task, as today there are dozens of similar programs, each of them has its advantages and disadvantages. As practice shows, it is all about the habit. Someone finds conventional news sites more convenient to use, others prefer to install news service programmes in their laptops and receive the latest news in pop-up windows. Some still read printed business articles and manage to make a lot of money out of it. This proves once again that it is not enough simply to get the information, you should use it wisely. This is the task of an entirely different level. In order to adjust your position at the foreign exchange market in accordance with the latest developments in the world of finance, it is necessary to learn how to use analytical tools, including a rather complex tool such as fundamental analysis.

Fortunately, today, in our digital age, being aware of the latest changes is not so difficult.
Fortunately, today, in our digital age, being aware of the latest changes is not so difficult.

Analyze and forecast

Forecasting supposes looking into the essence of the events and deduce the impact that they will cause. Any error is fraught with serious losses. Any correct prediction may turn you into the currency market legend from an unknown trader.

Naturally, not each trader possesses such forecasting skill. This is why most of them use third party analytics instead of speculating on their own. In order to make accurate predictions, you must have analytical thinking, know theoretical basis of economics, politics and international relations, be capable of finding connections between events, especially those seemingly unrelated to each other, etc. Apart from everything else, you must constantly monitor the latest developments in the world, and, what is more, devote the most of your working time to this analysis.

In short, in order to make correct predictions you should be completely wrapped into in the world of finance and have a lot of patience.

It will be even better, if you eventually fall in love with your new hobby, because without love to analytics and forecasting you will soon get tired of digging in your news feed. Do not surrender to despair if this already happened; you can always use services of analysts working in brokerages.

Reasons to follow the financial market news
Any trader can and should use information for profit. Let's find out why asking “how is the stock market?” is so important.

What is the financial market?

Any person who wishes to increase their capital will inevitably face the concept of the financial market. Securities are the most popular way of money investing, since they provide multiple profits and appear as a highly tradable product which can be quickly bought and sold, which is impossible with fixed assets, for example.
The key word here is the market. Once it is the market, there must be are sellers that offer a product and customers who buy this product. At the stock market, this product is securities. The stock market is another name for the securities market.
Securities are shares, bonds, warrants, notes, options, futures, shares (stocks).
The stock market is a mechanism for transfer of funds from one economic sector to another. It may be represented by the following example: there is a company that produces a specific product, and it has no money for continued manufacture. To get the money the company put its securities to the market. Another company, with possesses the necessary amount of money, buys these securities. This results distribution of capital between the enterprises and industries.

No matter what information comes out, bad or good, it creates more volatility at the market.
No matter what information comes out, bad or good, it creates more volatility at the market.

Why traders follow financial news?

Economic and financial news have a direct impact on the stock market, so traders should monitor them constantly. As they say, who owns the information, he owns the world. Different information affect the market in different ways. The share price may go up sharply because of good quarterly income reports, and may significantly drop because of the hurricane that destroyed the company’s production assets. That is why you should follow stock market news, if you do not want to wake up one “fine” morning and see that your profitable position became tragically losing after some important information appeared at the market.
Financial news are important because they:
1. Inform the market. In other words, good news boost increased demand for the share, and the bad news increase offer. It is believed that all the significant short-term fluctuations at the market happen purely because of the news.
2. Create volatility. We will not be able to make a profit if the price is stable. The news at the market, different from the expectations of stock gamblers, create stirring and therefore volatility.
3. Limit the risk. Most of the stock news are scheduled so you know when fresh information will come out, what it will be about, and what its impact on the market will be. Thus, one can prepare for it and, if necessary, limit their risks.

Forecasts at the gold stock market

The volatility of gold quotations

It will not be a problem to find a buyer if you want to sell gold, and, vice versa, a buyer will always find as much gold as needed. Every day is a huge number gold purchases are carried out at the market, due to the high volatility of stock exchange quotations for the metal. Within a single trading session, the price for gold can change at hundreds of points, so buying or selling binary options for gold, a trader can make a lot of money. In addition, gold price is more predictable than, currency rates for example. Traders point out that this asset follows the trend (which is, however, accompanied by high volatility) and shows sensitiveness to the news background.

Technical analysis

The main task of the trader is to predict the fluctuations of prices correctly. If you make bargains at random, there is a high probability that you lose the funds on deposit.
There are several methods to forecast the changes in the price for gold, which may be used in parallel, these are: technical analysis and monitoring of macroeconomic indicators. Technical analysis is more or less clear, like any other asset, gold prices are analyzed by using the graph reflecting the fluctuation of quotations, where certain patterns and shapes maybe easily tracked out.
However, the most accurate predictions can be carried out after analyzing macroeconomic indicators, as well as monitoring economy world news.

Monitoring world news makes a successful businessman.
Monitoring world news makes a successful businessman.

Macroeconomic factors

Some factors having influence on the gold quotations:

1. Demand. The more buyers want to buy gold, the higher the price rises. In addition, gold has long been a reserve asset. When the economy is unstable, investors transfer money into gold to save money from depreciation.

2. Gold production. Gold is a non-renewable resource, therefore, the less the amount of gold is offered, the higher the price for gold is. However, we may face a situation when gold is offered more than consumed. For example, one of the countries (large gold consumers) ceases to make purchases (for example, because of a military conflict or economic instability). As a result, gold gets cheaper, as production remains at the same level, and the companies owning the mines must sell this gold anyway.

3. Degree of economic stability in gold-consuming countries.
Now let’s consider some examples of how the news of business section influence the macroeconomic factors and how to make a profit from them.
For example, major media outlets publish reports that the stock market of a large country subsided significantly. Before this moment a stable rising trend in gold could be observed. Accordingly, some part of the stock market will be converted into gold, so the metal will rise in price. We know already that gold is sensitive to the news and tends to follow the trend, so you can buy binary options.
Consider another example. Reports are published that gold mining is on the verge of profitability at the current price, and the companies plan to cut production. If this trend is vertical we can buy options, because the decline in production is accompanied by the rise of quotations, if the trend falls, we should sell, as the decline in production output can be caused by the decline in demand.
Thus, gold trading through binary options may become a lucrative employment, as it allows to earn no matter if the price rises or falls.

Making a pretty penny out of penny stocks

Not all people have enough amount of money for equity investments. However, it should not prevent anyone trading at stock markets. You still can buy and sell stocks and turn an honest penny. Consider penny stocks.

What are penny stocks?

Penny stocks got their name because of relatively low price, which is typically less than $ 5.00. The low price makes penny stocks so attractive to individual investors who usually do not have sufficient funds to build a portfolio of the most expensive shares issued by large companies. Some penny stocks grow in price significantly, bringing their owners incredible profits, but there are cases when the companies issuing penny stocks turn out to be low-profit or even go bankrupt.
Some of the most successful companies started as penny stocks companies. The share price of such companies as Mylan Labs (MYL), Fortescue Metals Group (FMG), originally was well below five dollars, and now it is relatively high (though not a blue chip) and stable. There are companies that started small but it hit big and noted a remarkable increase in the stock price.

Penny stocks may grow in price and bring profits.
Penny stocks may grow in price and bring profits.

Rules to avoid risks at the penny stock markets

Penny stock companies are also known as small-cap companies. Small-cap stands for small-capitalization. These are companies with dollar capitalization less than $50 million dollars. This is the reason why their shares are traded for less than five dollars. But how can one choose these penny stock companies for investment? What are the risks? Since you are playing at the stock market there is always a certain level of risk involved. However, you can minimize the risk, following these simple rules:

1. Make inquiries. When choosing a company for investment, it is important to know if it can offer good prospects for the future. Check its economic background paying attention at each economic event; examine its vision and plans for the future development. This way you can reduce the risk of being a victim of a fraud.

2. Start small. It is better to start with small investment. Remember that you still get some experience from this type of shares. In this case cautiousness is not cowardice, but necessary preventive measure.

3. Follow the trends. Try to follow current market news to understand the common trends. Currently, the shares of IT and environmentally responsible enterprises are nice choice to invest to the future. You can focus on these sectors and keep yourself up to date with the news of these industries.
When you help these small companies, it is cannot be regarded as speculation. There is certain social responsibility that appears if you think that these small companies are really good in their sphere and have promising future. You may find that their products may be solutions to some persistent world issues. Though the profit may be small, do not forget that investing does not always means profit, but always means a game. Benefit is benefit no matter how we look at it. Do not lose courage, you may lose a few dollars, but, at the end of the day, you played the game. Who knows, you may make a fortune supporting losers.

Economic systems: what is capitalism

General definition

What is capitalism? It is a system of economy that is based on private ownership of means of production and the creation of goods or services for profit. Characteristic traits include competitive markets, wage labor and accumulation of capital. Capitalism can come in different forms, like laissez-faire, welfare capitalism and state capitalism. It is believed by many theorists to promote economic growth and to allow for more opportunities for individuals to have more income. However, some critics of capitalism also attribute such aspects as social inequality and unfair distribution of wealth and power.

Types of capitalism

Depending on country and region capitalism can appear in many different variants. Below are the major ones.

  • Mercantilism

This is an early form of capitalism that is associated with intertwining of national business interests to state-interest and imperialism. Example: early colonists living inAmerica.

  • Free-market capitalism

What is capitalism with a free-market model? It is a system where prices for goods and services are set freely by the forces of supply and demand with no intervention by government policy.

  • Social-market economy

What is capitalism with social-market economy? It is a system where prices form with minimal intervention by the government. Example: Western and Northern European countries.

  • State capitalism

What is capitalism with a state system? It suggests state ownership of the means of production within a state. The government influences the economy on a wider scale.

  • Corporate capitalism

Corporate capitalism is associated with the dominance of hierarchical, bureaucratic corporations

  • Mixed economy

What is capitalism with mixed economy? This kind of system consists of both private and public ownership of the means of production. Macroeconomic policies are intended to correct market failures.