Importance of the Consumer Price Inflation Index In Solving Macroeconomic Issues

The consumer Price Index (CPI) is a measure of inflation. It measures the extent of demand and supply of commodity goods in the market done by the US Bureau of Labor and Statistics. These goods and services may include different items like train fares, car registration, petrol, loaf of bread, etc. Although the rates are always positive, some short term negative movements have occurred as well.

On the other hand, macroeconomics is the term used in analyzing economic factors that affect nations as it concerns other nations. This article is focused on the relationship between, Consumer Price Inflation Index and unemployment in relation to the economy of the nation.

The price level in the economy is affected by a wide range of prices in the economy, which is measured by the CPI. The change in price level is usually measured by the change in the price index over a period of time. The basket of goods measured by the CPI are those goods generally consumed by the families of a nations which provide necessities of life, such as household items, consumer electronic, clothing, shelter, and food.
If the consumer price index increases more than the family income, the households’ standard of living falls, leading to inflation. In recent years, the CPI has witnessed a continuous increase of about 6% per year. This entails that the inflation rate s equally moving at the same proportion to this increase.

Inflation refers to the increase in the general price level in an economy. As the inflation rate rises, the purchasing power declines, and money becomes devalued because more money is chasing fewer goods. With the Consumer Price Inflation Index, the government will be able to find out when there is inflationary tendencies since price movement depends on the price of goods in the market. Once the CPI is showing signs of inflation, the government can take precautionary measures to correct the imbalance before it gets out of hand.

If inflation lingers for a long time, it might lead to a rise in unemployment rate followed by other economic indicators. But the first economic indicator of an imbalanced economy is inflation. This is why the CPI is very important. The government can plan ahead with the signs provided by the CPI and proceed to ensure that the situation does not lead to other negative economic indicators.

Therefore, the CPI is a vital indicator when dealing with inflation and other macroeconomic issues. For more updates and a good feed source on strategies to deal with it buy and read this gold investing book.

Some important tips to follow when buying a Car

Buying a car will always be a vital decision to make. It is not a straightforward procedure and you are likely to make the wrong choice when you don’t have a clear idea of what you need. You are supposed to consider several things before buying a car. Below are four main things you need to check out before buying a car.

1) Proper research

A car will always take out a huge crunch of your investment, except you decide to buy an old crappy car that visits the mechanic regularly. You need to research on the particular car you are going for. Make sure to compare prices, check out the speed limit, warrantees, and any other thing that will help you make the right choice. You need to make proper research so that you don’t buy a car that doesn’t meet your expectations.
2) Take your time before you decide

You don’t need to be in haste when buying a car. This is an asset that will last you for years, so why being in a hurry to purchase it. Remember you are spending a lot of money to get this car. Do not get carried away by a single model and don’t let your emotions decide which car you finally chose to buy. Be absolutely sure that the car you are interested in will serve the purpose it is intended for.

3) Make safety features a priority

Several car owners today do not know the importance of the safety features in their cars. Today’s cars are manufactured with several safety features that will help their owners stay safe on the road and off it. Safety features like head protecting air bags, anti-lock brake systems, and electronic stability control are some features you need to look out for when buying a car. These features will minimize casualty risks to a great extent.

4) Do not buy without test-driving

Some people make the mistake of paying for their cars (especially new cars) without test-driving. Whether you are buying an old vehicle or a new one, it is important you test drive the vehicle. This will enable you and your family find out how well it meets your expectations and helps avoid inconveniences after the buying deal has been done.

Buying a car will require you to withdraw a huge amount from your savings. Even if you are buying on loan, you are still the one to pay back. So, it is important to use the above guide when buying a car. Making an informed decision is very important in this regard.

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Tourists Destinations- Focus on Williamsburg Virginia

Williamsburg is a US City in Virginia with a population of about 14,000. It is bordered by York County and James City County, and located in the northern part of Hampton Roads.

The city was established in 1632 and served as Virginia’s capital from 1699 to 1780. Williamsburg was the main area where political events were carried out in the period leading to the American Revolution. The city houses the College of William and Mary (founded in 1693), second oldest tertiary institution in the US. Three former U.S. presidents attended the college as well as so many other notable figures in United State’s history.

Present day Williamsburg is now largely inhabited by students and staff of College of William and Mary. The city has a public school system jointly run by James City County and the city of Williamsburg. This school system, popularly referred to as “WJCC” is made up of 15 schools with a population of 9,000 students. There are 3 high schools, 3 middle schools, and 9 elementary schools.

Among the 9 elementary schools in the city, the James River Elementary school draws the most attention. Its programs include the Baspod.

The public school system in Williamsburg has been highly ranked over the years. In 2001, it was ranked among the top 15% of public school systems in the United States, and ranked among the top 5 school systems within Virginia.
The College of William and Mary in Williamsburg has historical foundations. It was the first school to have a Royal Charter in the United States. More than two-thirds of the students either serve as community volunteers or work part-time. The students in the college spend more than 250,000 hours yearly doing volunteering work in the community.

Apart from the College of William and Mary, there are other community colleges within a thirty-mile radius of the city that offer transfer programs and associate degrees. They include the Rappahannock Community College, Camp Community College, and Thomas Nelson College.

Williamsburg has also hosted political events in the past. In 1976, one of three debates between Democratic leader Jimmy Carter and Republican President Gerald Ford was held at the College of William and Mary.

The 1983 G7 summit was also held in the city, as discussions were centered on arms control, growing debt crisis, and more cooperation between the G7 (Presently G8) and the Soviet Union.

Queen Elizabeth II of England also visited Williamsburg and James Town in May, 2007, after previously visiting Williamsburg in 1957.

Williamsburg’s economy is highly dependent on tourism. Along with neighboring Yorktown and Jamestown, Williamsburg is part of the Historic Triangle that receives more than 4 million tourists yearly.

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A Brief History of General Motors Corporation

General Motors is an American Multinational corporation that designs and distributes cars across 37 countries. The company also sells services and produces cars under ten brands: UzDaewoo, Jie Fang, Baojun, Wuling, Vauxhall, Holden, Opel, Cadillac, GMC, Buick, and Chevrolet.

GM, as it is popularly called, holds 96% stake in GM Korea and 20% stake in Shanghai GM. It equally has some joint ventures with Isuzu Truck South Africa, General Motors Egypt, General Motors India, General Motors Uzbekistan, Ghandhara Industries Pakistan, GM Avto VAZ in Russia, General Motors Russia, General Motors China, and General Motors Shanghai.

The company does business in 157 countries and employs more than 200,000 people.GM has five business segments: GM financial, GM South America (GMSA), GM International Operations (GMIO), GM Europe (GME), and GM North America (GMNA).

The company has been the leader in world vehicle sales from 1931 to 2007, and is still one of the best car makers in the world. But GM shed a lot of brands in 2009, closing Hummer, Pontiac, and Saturn.

General Motors was established in September, 1908 when it was then managed by William Durant. Charles Stewart Mott was the co-founder as his carriage company was merged with Buick before the founding of General Motors. In the coming years after the founding of GM, Stewart became the biggest stockholder in GM. Later in 1909, GM added Oldsmobile into its collection. Later in the same year, Durant acquired Oakland, Elmore, Cadillac, and several other brands.

However in 1910 Durant lost control of the company he help founded due to the drop of new vehicle sales and large amount of debts taken during the acquisition of several brands.

But Durant bounced back in 1911 with the establishment of the Chevrolet car Company. With this, he regained a considerable interest in GM. A proxy war was won by Durant, allowing him to take full control of GM again. He then changed the name to General Motors Corporation (formally General Motors Company) in 1916. But his ownership wasn’t going to last long as he lost control again because of the collapse of the new vehicle market. Alfred Slogan was appointed to lead the rejuvenation of the car company. He then propelled GM to unprecedented heights that lasted until the 1980s when it operated 150 assembly plants and employed 348,000 workers.

Till date, the company remains one of the largest global automaker in the world till date.

Basic Components Of Fundamental Analysis Of Stocks

Fundamental analysis of stocks is the basis of investing. Investment strategies are numerous and most of them have fundamental analysis at their base. It is utilized in predicting the future price of stocks based on certain factors that determine the demand and supply of such stock. When people know the future direction of a stock, they will be able to make informed investment decisions regarding potential stock picks. Fundamental analysis relies on information such as industry news, announcements by the company, annual report, profit and loss statement, and balance sheet of the company.

This information becomes the pivotal elements in stock evaluation, which are the most vital factors in fundamental analysis of stocks. These elements are explained below.
1. Earnings

The earning of a stock over a period of time is a very important tool when analyzing the performance of a stock. It is vital to find out how a company is performing in terms of profit before seeking to invest. Earnings per share (EPS) and the P/E ratio are the principal tools used in determining a company’s profitability. You can get this information from the quarterly issue of the company which indicates how much the company earns in that quarter.

2. Price per Book:

Price per book ratio is used when comparing a company’s book value to its market value. The formula for determining the P/B ratio is thus: current share price/book value per share.

3. Profit Margins:

This compares the cost the company incurs to its sales. Usually, if the cost is higher than the sales, the profit margin will be lower. This might lead to lesser returns to its investors. To calculate profit margin, we divide the net income by the company’s revenue.

4. Return on Equity:

The return on equity measures how efficient a company is in making profits. It is calculated by dividing the net income by the shareholder’s equity.

5. Valuation Multiples:

This is the fastest way to analyze a company. They are the tools (such as P/E ratio) in which comparable analysis is carried out on a company. With valuation multiples, an investor can determine whether a company is doing better or worse than its previous performance. Company evaluations using these multiples are easy and are the quickest way to find out how a company is really performing.

Investors are required to perform fundamental analysis before investment in stocks. This will enable them analyze stocks and measure their real worth of the before making any financial commitment in the stock market.

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