0_Wizard
I am a Finance major in college. I study investments and financial products.
Finance is a field that deals with the study of investments.
chosen_Finance_0
Finance
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Islamic banking and finance
Islamic banking or Islamic finance () or sharia-compliant finance is banking or financing activity that complies with sharia (Islamic law) and its practical application through the development of Islamic economics. Some of the modes of Islamic banking/finance include "Mudarabah" (Profit sharing and loss bearing), "Wadiah" (safekeeping), "Musharaka" (joint venture), "Murabahah" (cost plus), and "Ijar" (leasing). Sharia prohibits "riba", or usury, defined as interest paid on all loans of money (although some Muslims dispute whether there is a consensus that interest is equivalent to "riba"). Investment in businesses that provide goods or services considered contrary to Islamic principles (e.g.
Assessments, controversies, challenges in Islamic finance
Islamic banking and finance — the industry built around avoiding interest and other financial practices found in violation of sharia (Islamic law) — has been both praised and criticized by observers. The industry has been praised for turning a "theory" into an industry that has grown to about $2 trillion in size; for attracting new banking users who otherwise would not have used banking services (due to religious objections to conventional banking), drawing non-Muslim bankers into the field, and (according to other supporters) introducing a more stable, less risky form of finance. However, the industry has also been criticized as undermining its own "raison d'être" and having moved in the wrong direction over the decades — leading both outsiders and rank and file Muslims to question it.
Subprime mortgage crisis
The United States (U.S.) subprime mortgage crisis was a nationwide banking emergency, occurring between 2007-2010, which contributed to the U.S. recession of December 2007 – June 2009. It was triggered by a large decline in home prices after the collapse of a housing bubble, leading to mortgage delinquencies and foreclosures and the devaluation of housing-related securities. Declines in residential investment preceded the recession and were followed by reductions in household spending and then business investment. Spending reductions were more significant in areas with a combination of high household debt and larger housing price declines.
Causes of the Great Recession
Many factors directly and indirectly caused the Great Recession (which started in 2007 with the US subprime mortgage crisis), with experts and economists placing different weights on particular causes. Major causes of the initial subprime mortgage crisis and following recession include: International trade imbalances and lax lending standards contributing to high levels of developed country household debt and real-estate bubbles that have since burst; U.S. government housing policies; and limited regulation of non-depository financial institutions. Once the recession began, various responses were attempted with different degrees of success.
Subprime mortgage crisis solutions debate
The Subprime mortgage crisis solutions debate discusses various actions and proposals by economists, government officials, journalists, and business leaders to address the subprime mortgage crisis and broader financial crisis of 2007–08. The debate concerns both immediate responses to the ongoing subprime mortgage crisis, as well as long-term reforms to the global financial system. During 2008-2009, solutions focused on support for ailing financial institutions and economies. During 2010, debate continued regarding the nature of reform. Key points include: the split-up of large banks; whether depository banks and investment banks should be separated; whether banks should be able to make risky trades on their own accounts; how to wind-down large investment banks and other non-depository financial institutions without taxpayer impact; the extent of financial cushions that each institution should maintain (leverage restrictions); the creation of a consumer protection agency for financial products; and how to regulate derivatives.
Financial crisis of 2007–2008
The financial crisis of 2007–2008, also known as the global financial crisis and the 2008 financial crisis, is considered by many economists to have been the worst financial crisis since the Great Depression of the 1930s. It began in 2007 with a crisis in the subprime mortgage market in the US, and developed into a full-blown international banking crisis with the collapse of the investment bank Lehman Brothers on September 15, 2008. Excessive risk-taking by banks such as Lehman Brothers helped to magnify the financial impact globally. Massive bail-outs of financial institutions and other palliative monetary and fiscal policies were employed to prevent a possible collapse of the world financial system.
Goldman Sachs
The Goldman Sachs Group, Inc. is an American multinational finance company that engages in global investment banking, investment management, securities, and other financial services including asset management, mergers and acquisitions advice, prime brokerage, and securities underwriting services. It also sponsors private equity funds, is a market maker, and is a primary dealer in the United States Treasury security market. Goldman Sachs also owns GS Bank USA, a direct bank. Goldman Sachs was founded in 1869 and is headquartered at 200 West Street in Lower Manhattan, New York City, with additional offices in other international financial centers.
1_Apprentice
That sounds very interesting. Is it a complicated thing to study?
0_Wizard
Not really. It includes assets and liabilities, as well as uncertainty and risk.
It includes the dynamics of assets and liabilities over time under conditions of different degrees of uncertainty and risk.
chosen_Finance_0
Finance
chosen_topic_0_Finance
Subprime mortgage crisis solutions debate
The Subprime mortgage crisis solutions debate discusses various actions and proposals by economists, government officials, journalists, and business leaders to address the subprime mortgage crisis and broader financial crisis of 2007–08. The debate concerns both immediate responses to the ongoing subprime mortgage crisis, as well as long-term reforms to the global financial system. During 2008-2009, solutions focused on support for ailing financial institutions and economies. During 2010, debate continued regarding the nature of reform. Key points include: the split-up of large banks; whether depository banks and investment banks should be separated; whether banks should be able to make risky trades on their own accounts; how to wind-down large investment banks and other non-depository financial institutions without taxpayer impact; the extent of financial cushions that each institution should maintain (leverage restrictions); the creation of a consumer protection agency for financial products; and how to regulate derivatives.
Subprime mortgage crisis
The United States (U.S.) subprime mortgage crisis was a nationwide banking emergency, occurring between 2007-2010, which contributed to the U.S. recession of December 2007 – June 2009. It was triggered by a large decline in home prices after the collapse of a housing bubble, leading to mortgage delinquencies and foreclosures and the devaluation of housing-related securities. Declines in residential investment preceded the recession and were followed by reductions in household spending and then business investment. Spending reductions were more significant in areas with a combination of high household debt and larger housing price declines.
Subprime crisis background information
This article provides background information regarding the subprime mortgage crisis. It discusses subprime lending, foreclosures, risk types, and mechanisms through which various entities involved were affected by the crisis. The U.S. Federal Deposit Insurance Corporation (FDIC) has defined subprime borrowers and lending: "The term subprime refers to the credit characteristics of individual borrowers. Subprime borrowers typically have weakened credit histories that include payment delinquencies, and possibly more severe problems such as charge-offs, judgments, and bankruptcies. They may also display reduced repayment capacity as measured by credit scores, debt-to-income ratios, or other criteria that may encompass borrowers with incomplete credit histories.
United Kingdom insolvency law
United Kingdom insolvency law regulates companies in the United Kingdom which are unable to repay their debts. While UK bankruptcy law concerns the rules for natural persons, the term insolvency is generally used for companies formed under the Companies Act 2006. "Insolvency" means being unable to pay debts. Since the Cork Report of 1982, the modern policy of UK insolvency law has been to attempt to rescue a company that is in difficulty, to minimise losses and fairly distribute the burdens between the community, employees, creditors and other stakeholders that result from enterprise failure. If a company cannot be saved it is "liquidated", so that the assets are sold off to repay creditors according to their priority.
Asset-backed commercial paper program
Asset-backed commercial paper program (ABCP program, ABCP Conduit or Conduit) is set up as a program that issues short-term liabilities, commercial papers called asset-backed commercial papers (ABCPs), to finance medium- to long-term assets. In terms of terminology, ABCP usually refers to asset-backed commercial paper, while ABCP conduit (or conduit) the program. The maturities of ABCP range up to 270 days but average about 30 days. Like banks, ABCP programs provide liquidity and maturity transformation services. Because of this structure, ABCP conduits are considered to be part of the Shadow banking system.
Icesave dispute
The Icesave dispute was a diplomatic dispute that began after the privately owned Icelandic bank Landsbanki was placed in receivership on 7 October 2008. As "Landsbanki" was one of three systemically important financial institutions in Iceland to go bankrupt within a few days, the Icelandic Depositors' and Investors' Guarantee Fund ("Tryggingarsjóður") had no remaining funds to make good on deposit guarantees to foreign "Landsbanki" depositors who held savings in the Icesave branch of the bank. When "Landsbanki" was placed into receivership by the Icelandic Financial Supervisory Authority (FME), 343,306 retail depositors in the UK and Netherlands that held accounts in the "Icesave" branch of "Landsbanki" lost a total of €6.7bn of savings.
South African insolvency law
Insolvency in South African law refers to a status of diminished legal capacity ("capitis diminutio") imposed by the courts on persons who are unable to pay their debts, or (which amounts to the same thing) whose liabilities exceed their assets. The insolvent's diminished legal capacity entails deprivation of certain of his important legal capacities and rights, in the interests of protecting other persons, primarily the general body of existing creditors, but also prospective creditors. Insolvency is also of benefit to the insolvent, in that it grants him relief in certain respects. In broad and everyday terms, a person is insolvent when he is unable to pay his debts.
1_Apprentice
Oh okay. I'm not one to take risks. I just can't gamble with my money
0_Wizard
Risk isn't necessary gambling. It is measuring the expected rate of return.
Finance aims to price assets based on their risk level and their expected rate of return.
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Finance
chosen_topic_0_Finance
Credit card interest
Credit card interest is the principal way in which credit card issuers generate revenue. A card issuer is a bank or credit union that gives a consumer (the cardholder) a card or account number that can be used with various payees to make payments and borrow money from the bank simultaneously. The bank pays the payee and then charges the cardholder interest over the time the money remains borrowed. Banks suffer losses when cardholders do not pay back the borrowed money as agreed. As a result, optimal calculation of interest based on any information they have about the cardholder's credit risk is key to a card issuer's profitability.
Capital asset pricing model
In finance, the capital asset pricing model (CAPM) is a model used to determine a theoretically appropriate required rate of return of an asset, to make decisions about adding assets to a well-diversified portfolio. The model takes into account the asset's sensitivity to non-diversifiable risk (also known as systematic risk or market risk), often represented by the quantity beta (β) in the financial industry, as well as the expected return of the market and the expected return of a theoretical risk-free asset. CAPM assumes a particular form of utility functions (in which only first and second moments matter, that is risk is measured by variance, for example a quadratic utility) or alternatively asset returns whose probability distributions are completely described by the first two moments (for example, the normal distribution) and zero transaction costs (necessary for diversification to get rid of all idiosyncratic risk).
Kelly criterion
In probability theory and intertemporal portfolio choice, the Kelly criterion, Kelly strategy, Kelly formula, or Kelly bet is a formula used to determine the optimal size of a series of bets in order to maximise the logarithm of wealth. In most gambling scenarios, and some investing scenarios under some simplifying assumptions, the Kelly strategy will do better than any essentially different strategy in the long run (that is, over a span of time in which the observed fraction of bets that are successful equals the probability that any given bet will be successful). It was described by J. L. Kelly, Jr, a researcher at Bell Labs, in 1956.
Models of DNA evolution
A number of different Markov models of DNA sequence evolution have been proposed. These substitution models differ in terms of the parameters used to describe the rates at which one nucleotide replaces another during evolution. These models are frequently used in molecular phylogenetic analyses. In particular, they are used during the calculation of likelihood of a tree (in Bayesian and maximum likelihood approaches to tree estimation) and they are used to estimate the evolutionary distance between sequences from the observed differences between the sequences. These models are phenomenological descriptions of the evolution of DNA as a string of four discrete states.
Rebreather diving
Rebreather diving is underwater diving using rebreathers, which recirculate the breathing gas already used by the diver after replacing oxygen used by the diver and removing the carbon dioxide metabolic product. Rebreather diving is used by recreational, military and scientific divers in applications where it has advantages over open circuit scuba, and surface supply of breathing gas is impracticable. The main advantages of rebreather diving are extended gas endurance, and lack of bubbles. Rebreathers are generally used for scuba applications, but are also occasionally used for bailout systems for surface supplied diving.
Fisher equation
The Fisher equation in financial mathematics and economics estimates the relationship between nominal and real interest rates under inflation. It is named after Irving Fisher, who was famous for his works on the theory of interest. In finance, the Fisher equation is primarily used in YTM calculations of bonds or IRR calculations of investments. In economics, this equation is used to predict nominal and real interest rate behavior. Letting denote the real interest rate, denote the nominal interest rate, and let denote the inflation rate, the Fisher equation is:  This is a linear approximation, but as here, it is often written as an equality:  The Fisher equation can be used in either ex-ante (before) or ex-post (after) analysis.
Online gambling
Online gambling (or Internet gambling) includes poker, casinos and sports betting. The first online casino was in 1994. Many countries restrict or ban online gambling, but it is legal in some provinces in Canada, most countries of the European Union and several nations in the Caribbean. In 1994, Antigua and Barbuda passed the Free Trade & Processing Act, allowing licences to be granted to organisations applying to open online casinos. Before online casinos, the first fully functional gambling software was developed by Microgaming, an Isle of Man-based software company. This was secured with software developed by CryptoLogic, an online security software company.
1_Apprentice
cant you still lose your money if the rate of return is poor or 0?
0_Wizard
Yeah, but some investments have a near guaranteed rate of return.
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Guaranteed Rate
Guaranteed Rate Inc., is a U.S. residential mortgage company headquartered in Chicago, Illinois. Founded in 2000 by Victor Ciardelli, the company was a top 5 mortgage lender in 2016 with $22.9 billion in funded volume. As of 2017, the company has approximately 3,400 employees and 215 offices nationwide and has licenses in 50 states. In 2013, Guaranteed Rate was listed as one of the fastest growing companies in Chicago. Guaranteed Rate was founded in Chicago in 2000 by Victor F Ciardelli III. The company is now a top 5 retail mortgage lender with approximately 3,400 employees in 215 offices across all 50 states.
Cubs–White Sox rivalry
The Cubs–White Sox rivalry (also known as the Crosstown Classic, The Windy City Showdown, Chicago Showdown, Red Line Series, North-South Showdown, Halsted Street Series, City Series, Crosstown Series, Crosstown Cup, or Crosstown Showdown) refers to the Major League Baseball (MLB) geographical rivalry between the Chicago Cubs and the Chicago White Sox. The Cubs are a member club of MLB's National League (NL) Central division, and play their home games at Wrigley Field, located on Chicago's North Side. The White Sox are a member club of MLB's American League (AL) Central division, and play their home games at Guaranteed Rate Field, located on Chicago's South Side.
Guaranteed Rate Field
Guaranteed Rate Field is a baseball park located in Chicago, Illinois, that serves as the home ballpark for the Chicago White Sox of Major League Baseball. The facility is owned by the state of Illinois through the Illinois Sports Facilities Authority, and is operated by the White Sox. The park opened for the 1991 season, after the White Sox had spent 81 years at the original Comiskey Park. It also opened with the name Comiskey Park but was renamed U.S. Cellular Field in 2003 after U.S. Cellular bought the naming rights at $68 million over 20 years. The current name was announced on October 31, 2016, after Guaranteed Rate, a private residential mortgage company located in Chicago, purchased the naming rights to the ballpark in a 13-year deal.
The Equitable Life Assurance Society
The Equitable Life Assurance Society (Equitable Life), founded in 1762, is a life insurance company in the United Kingdom. The world's oldest mutual insurer, it pioneered age-based premiums based on mortality rate, laying “the framework for scientific insurance practice and development” and “the basis of modern life assurance upon which all life assurance schemes were subsequently based”. At its peak, Equitable had 1.5 million policyholders with funds worth £26 billion under management, but it had allowed large unhedged liabilities to accumulate in respect of guaranteed fixed returns to investors without making provision for adverse market changes.
Fixed annuity
Fixed annuities are insurance products which protect against the risk of outliving your income. They are insured by licensed and regulated insurance companies, similar to how your home, auto or health is insured. And just like your home, auto and health insurance, they are backed by the insurance company up to stated policy limits. State insurance guarantees vary from state to state, and may not cover 100% of the Annuity Value. For example, in California the fund will cover "80% not to exceed $250,000." There are two types of fixed annuities: traditional fixed and indexed annuities. (A third type of annuity, called a variable annuity, is not discussed here since it is not a type of fixed product.)
Chicago White Sox
The Chicago White Sox are an American professional baseball team based in Chicago. The White Sox compete in Major League Baseball (MLB) as a member club of the American League (AL) Central division. Home games are held at Guaranteed Rate Field, located on the city's South Side, and the team is owned by Jerry Reinsdorf. They are one of two major league clubs in Chicago; the other is the Chicago Cubs, who are a member of the National League (NL) Central division. One of the American League's eight charter franchises, the franchise was established as a major league baseball club in . The club was originally called the Chicago White Stockings, but this was soon shortened to Chicago White Sox.
Comiskey Park
Comiskey Park was a baseball park in Chicago, Illinois, located in the Bridgeport community on the near-southwest side of the city. The stadium served as the home of the Chicago White Sox of the American League from 1910 through 1990. Built by White Sox owner Charles Comiskey and designed by Zachary Taylor Davis, Comiskey Park hosted four World Series and more than six thousand Major League Baseball games. Also, in one of the most famous boxing matches in history, the field was the site of the 1937 heavyweight title match in which Joe Louis defeated then champion James J. Braddock in eight rounds that launched Louis' unprecedented 11-plus year run as the heavyweight champion of the world.
1_Apprentice
What kinds of investments are those? I would be interested in that
0_Wizard
I would recommend municipal or federal bonds. As long as the government doesn't go belly up you will get a return.
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Economic history of the United States
The economic history of the United States is about characteristics of and important developments in the U.S. economy from colonial times to the present. The emphasis is on economic performance and how it was affected by new technologies, the change of size in economic sectors and the effects of legislation and government policy. Specialized business history is covered in American business history. The colonial economy differed significantly from that of most other regions in that land and  natural resources were abundant in America but labor was scarce. From 1700 to 1775 the output of the thirteen colonies increased 12 fold, giving the colonies an economy about 30% the size of Britain's at the time of independence.
Municipal bond
A municipal bond, commonly known as a Muni Bond, is a bond issued by a local government or territory, or one of their agencies. It is generally used to finance public projects such as roads, schools, airports and seaports, and infrastructure-related repairs. The term municipal bond is commonly used in the United States, which has the largest market of such trade-able securities in the world. As of 2011, the municipal bond market was valued at $3.7 trillion. Potential issuers of municipal bonds include states, cities, counties, redevelopment agencies, special-purpose districts, school districts, public utility districts, publicly owned airports and seaports, and other governmental entities (or group of governments) at or below the state level having more than a de minimis amount of one of the three sovereign powers: the power of taxation, the power of eminent domain or the police power.
State income tax
Most individual U.S. states collect a state income tax in addition to federal income tax. The two are separate entities. Some local governments also impose an income tax, often based on state income tax calculations. Forty-three states and many localities in the United States may impose an income tax on individuals. Forty-seven states and many localities impose a tax on the income of corporations. State income tax is imposed at a fixed or graduated rate on taxable income of individuals, corporations, and certain estates and trusts. The rates vary by state. Taxable income conforms closely to federal taxable income in most states, with limited modifications.
Presidency of George Washington
The presidency of George Washington began on April 30, 1789, when Washington was inaugurated as the first President of the United States, and ended on March 4, 1797. Washington took office after the 1788–89 presidential election, the nation's first quadrennial presidential election, in which he was elected unanimously. Washington was re-elected unanimously in the 1792 presidential election, and chose to retire after two terms. He was succeeded by his vice president, John Adams of the Federalist Party. Washington had established his preeminence among the new nation's Founding Fathers through his service as Commander-in-Chief of the Continental Army during the American Revolutionary War and as President of the 1787 Constitutional Convention.
Thaddeus Stevens
Thaddeus Stevens (April 4, 1792 – August 11, 1868) was a member of the United States House of Representatives from Pennsylvania and one of the leaders of the Radical Republican faction of the Republican Party during the 1860s. A fierce opponent of slavery and discrimination against African-Americans, Stevens sought to secure their rights during Reconstruction, in opposition to President Andrew Johnson. As chairman of the House Ways and Means Committee during the American Civil War, he played a leading role, focusing his attention on defeating the Confederacy, financing the war with new taxes and borrowing, crushing the power of slave owners, ending slavery, and securing equal rights for the Freedmen.
Smith v. Kansas City Title &amp; Trust Co.
Smith v. Kansas City Title & Trust Co., 255 U.S. 180 (1921), was a United States Supreme Court case that helped define the range and scope of federal question jurisdiction in state corporate law matters. The case dealt with whether or not a district court had the power to uphold the constitutional validity of the Federal Farm Loan Act of 1916. Charles E. Smith, a shareholder of Kansas City Title & Trust Company, challenged the company's investment in farm loan bonds. The plaintiff (Smith) sued by filing an action in the United States District Court for the Western District of Missouri. The suit was filed to prevent the state bank from buying the federal bonds, claiming that the Federal Farm Loan Act of 1916, the law in which the transaction was based on, was unconstitutional.
European debt crisis
The European debt crisis (often also referred to as the Eurozone crisis or the European sovereign debt crisis) is a multi-year debt crisis that has been taking place in the European Union since the end of 2009. Several eurozone member states (Greece, Portugal, Ireland, Spain and Cyprus) were unable to repay or refinance their government debt or to bail out over-indebted banks under their national supervision without the assistance of third parties like other Eurozone countries, the European Central Bank (ECB), or the International Monetary Fund (IMF). The detailed causes of the debt crisis varied.
1_Apprentice
Oh okay. What is the most risky thing you can do or invest in?