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Why Housing Starts Are Used As an Economic Indicator

Government and independent economists use a minimum of 12 economic indicators to help them determine how the U.S. economy is doing. Among these indicators is something known as ‘housing starts’. Housing starts are a verifiable statistic that measures the difference between the number of building permits issued and the actual number of houses being built during a given period. Housing start statistics are always released with a comparison of the previous month in order to track up-and-down trends.

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The Inverse Relationship between Risk and Face Value

Whenever an individual buys securities, he or she must consider what is known as face value. Unlike the face value of consumer goods, face values on securities are not always static. Depending on the type of security one purchases, face value could change from time to time, negatively or positively impacting one’s investments.

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The Main Reason the Euro Zone QE Will Not Work

The European Central Bank (ECB) is now in the process of implementing its own quantitative easing program modeled after what was done in the U.S. and Great Britain. The powers that be believe that the ultra-slow recovery in Euro Zone countries is largely due to not enough lending going on. They also believe that printing more money and flushing the system (a.k.a. quantitative easing) is the solution to the problem.

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Why Government Debt Should Matter to You

We hear a lot about government debt, also known as the public debt, during election season. However, once the votes are cast, the topic seems to fade from the collective conscience of America. That is dangerous. Government debt is a very real problem that should be important to every American citizen.

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FICA and the Establishment of Social Security

Take a look at your next pay stub. There should be a heading labeled FICA along with a specific dollar amount underneath it. Do you know what that is? Most people do not, except to say that it is something they know is deducted from their pay every week. It turns out that FICA, also known as the Federal Insurance Contributions Act of 1939, officially established what we now know as the Social Security system.

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What You Need to Know about the Dow Jones Industrial Average

Every night on the evening news, you see numbers relating to the Dow Jones Industrial Average (DJIA) and the S&P 500. The broadcasters seem completely confident talking about these numbers, but do they really know what the numbers mean? What’s more, do you really know what they mean?

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The Link between CPI and Inflation

Now that the 2014 midterm elections are behind us, political pundits and economists are turning their eyes to the 2016 presidential election. That means for the next two years, you will be hearing a lot more about something known as the consumer price index (CPI). This number, published regularly by the Bureau of Labor and Statistics (BLS), is intrinsically tied to inflation.

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Three Things You Need to Know about the BBB

The Better Business Bureau, also known as the BBB, is a nonprofit organization involved in consumer advocacy since 1912. American consumers have trusted the BBB for decades as a source of valuable information about companies of all sizes. However, many consumers misunderstand what the BBB is and how it functions. Here are the most important things you need to know about this organization. Read the rest of this entry »

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