Carburizing imparts a shell of high-carbon content to a low-carbon steel. This produces what might be termed a dual steel, allowing for an outer shell which when hardened would withstand wear, and a soft ductile core to produce ductility and w... Read more of Process Of Carburizing at Steel Making.caInformational Site Network Informational
Privacy


     Home - Stock Buying - Money Basics - Banking - Wealth - Nature of Rent- Economic Theory
 



Most Viewed

Puts And Calls
What Is Speculation?
Minor Movements In Prices
A Correct Basis For Speculating
What Stocks To Buy
Successful Speculation
Stock Some Terms Explained
When To Buy Stocks
Stop Loss Orders
Technical Conditions


Least Viewed

Two Kinds Of Traders
Possibilities Of Profit
When To Sell Stocks
Major Movements In Prices
The Desire To Speculate
Choosing A Broker
Manipulations
Short Selling
What Stocks Not To Buy
When Not To Buy Stocks


The Money Market And Stock Prices








Perhaps no other one thing influences the movement of stock prices so
much, in a large way, as money conditions. It is impossible to have a
big bull market without plenty of money. During a bull market nearly all
stocks are bought on margin, which is explained in Chapter XVI. This
makes it necessary for brokers to borrow large sums of money. When money
is tight, it is impossible to get enough to carry on a large movement in
stocks.

You will see, therefore, that the Federal Reserve Bank has it in its
power to regulate the stock market to some extent. In 1919 speculation
was carried very much further than it should have been, but undoubtedly
it would have been much worse had the Federal Reserve Bank not raised
interest rates and urged member banks to withdraw money from Wall
Street. While there was considerable criticism of that action, it
certainly was a good thing for the entire country.

In a period of depression, the banks accumulate money, and there always
is an abundance of money at the beginning of a bull market. During a
period of prosperity the banks' reserves decrease and their loans
increase. When you see these reserves go down to a very low point, it is
usually time for you to sell your stocks.





Next: Minor Movements In Prices

Previous: Major Movements In Prices



Add to del.icio.us Add to Reddit Add to Digg Add to Del.icio.us Add to Google Add to Twitter Add to Stumble Upon
Add to Informational Site Network
Report
Privacy
SHAREADD TO EBOOK


Viewed 2116