M2
M2 is defined as a “measure of money supply that includes checking deposits (M1) cash as well as (what is colloquially referred to as) near money”. Near Money “Near money" in the case of M2 includes mutual funds available in the money markets, also savings deposits and other types of time deposits, which are less liquid than cash and as such are not suitable as...
Tag-Along Rights
What are 'Tag-Along Rights' Tag-along rights, also referred to as "co-sale rights," are contractual obligations used to protect a minority shareholder, usually in a venture capital deal. If a majority shareholder sells his take, it gives the minority shareholder the right to join the transaction and sell his minority stake in the company. Tag-alongs effectively oblige the...
M1 – Money Supply
The money supply has different components and M1 is the measure of the component that includes the physical money held by public. It is the asset individuals or businesses can directly use for investment or for making payments of any kind. M1 includes coins, currency, NOW, checking amounts, and assets that can be quickly converted into physical money. It...
M0
What is 'M0' M0 is a measure of the money supply which combines any liquid or cash assets held within a central bank and the amount of physical currency circulating in the economy. In the United Kingdom, the M0 supply is also referred to as narrow money. Explaining 'M0' M0 (M-zero) is the most...
Creative Destruction In Economics
Creative destruction, sometimes called Schumpeter's gale, is an idea people studying economics theory say may lead to innovation in the business cycle. Karl Marx argued the devaluation of wealth in periods when capitalism is going through a financial crisis is an inevitable outcome of its wealth creation processes. During the 1950s, the Austrian economist Joseph Schumpeter built on and...
Tactical Asset Allocation (TAA)
What is 'Tactical Asset Allocation - TAA' Tactical asset allocation is an active management portfolio strategy that shifts the percentage of assets held in various categories to take advantage of market pricing anomalies or strong market sectors. Explaining 'Tactical Asset Allocation - TAA' To understand tactical asset allocation, one must first understand strategic asset allocation....
W-Shaped Recovery
What is 'W-Shaped Recovery' An economic cycle of recession and recovery that resembles a "W" in charting. A W-shaped recovery represents the shape of the chart of certain economic measures such as employment, GDP, industrial output, etc. A W-shaped recovery involves a sharp decline in these metrics followed by a sharp rise back to the previous peak,...
Wage Assignment
What Is a Wage Assignment? A wage assignment is an agreement in which an employer assigns its right to a certain amount of wages to an employee when he or she is in default. A wage assignment is valid for three years from the date of execution and two years if the employee changes jobs. The process begins when an...
G7 Bond
What is 'G7 Bond' A term used to refer to government bonds issued by a nation in the Group of Seven (G7). A G7 bond is considered relatively less risky than bonds issued by nations outside the G7. The G7 nations are Canada, France, Germany, Italy, Japan, the United Kingdom and the United States. All...
What are Fixed Interest Rates
What are Fixed Interest Rates There are several factors involved when you obtain a loan. For instance, when you look for a mortgage, considerations include the offer, property taxes, and HOA fees. The most important of these is the interest rate connected with the type of home loan you choose. There are a few ways this is presented...