Month: February 2021

300 Decades Of Money Trading300 Decades Of Money Trading

Pioneers of bank

Holy priests hated Jews, and villainous Italians were the pioneers of banking. They made a lot of money from interest on loans, and they became more and more greedy.

Tempel was the first bank
18th century BCE: In ancient Babylonia and Egypt, temples were pre-eminent places to store valuables, for no one dared to rob the sacred buildings. Babylonian priests also lent money in the time of King Hammurabi (18th century BC). The Babylonians were the first with an actual bank. 5th century BC: The ancient Greeks were merchants and needed a solid banking system. Therefore, in the 5th century BC, Athenian businessmen. Their money to the local bank, where they received a guarantee certificate with which they could collect it at another bank. This way they did not have to lug around heavy money boxes that could easily be stolen. The Greek banks also lent money to their customers and exchanged foreign currency. When it comes to choosing the best broker you can check Low Spread Forex Brokers.

Jews practiced prohibited professions
Middle-Ages: The medieval Catholic Church did not consider the profession of money lender appropriate for a Christian. In the 12th century, the Pope forbade all Christians to charge interest, preventing them from earning money from banking. However, the European monarchs had to borrow a lot of money to build and wage war, so they instructed the Jews, who were not forbidden by the Church’s prohibition, to lend money and in return offered protection. Most crafts were forbidden to Jews, and by lending money they earned a living. Because of their banking activities, they were looked at even more with the neck by the Christian population.

The modern bank originated in Italy
14th century: With creative accounting, Italian merchants circumvented the ecclesiastical prohibition on interest. In the 14th and 15th centuries, Northern Italian merchants succeeded in taking over much of the Jewish banking activities. They were not allowed to charge interest, but the Italians circumvented this prohibition by describing the interest as ‘gift’ or ‘reward for risk’ in their accounts. In Genoa, Siena, and especially Florence, the benches sprang up like mushrooms. In Florence, the De ‘Medici family made a fortune in loans. This gave her the say in the city and was even allowed to supply a number of popes. The Italians’ financial empires are seen as the forerunners of modern banking.

Nationalization in the 17th century
17th century: In 1661 Stockholms Banco was the first bank in Europe to issue banknotes instead of coins. But the company issued more notes than it had in silver and copper and went bankrupt. The state intervened and took over the bank’s estate in 1668. The institution that emerged from this still exists and is today Sweden’s national bank.

9,000 US banks go bankrupt
1929: Black Thursday, as is known on October 24, 1929. On that day, stock prices on the stock exchange on Wall Street in New York took a dive. Hundreds of thousands of Americans had invested in stocks, often with borrowed money, and that seemed like a safe investment. But the bubble burst and the financial crisis that followed killed 9,000 US banks.

Global financial crisis
Until a few years ago, the international investment bank Lehman Brothers had $ 691 billion in assets and employed 26,000 people. But the bank owed its success to high-risk loans, and 2008 went wrong. The financial giant went bankrupt, and a global economic crisis was the result. European pension funds lost billions of euros. Lehman Brothers were the largest, but by no means the only, bank to collapse during this crisis, and its effects are still felt today.

How GDP is Computed?How GDP is Computed?

GDP or Gross Domestic Product is simply the total market or monetary value of all services like private schools debt collection, cleaning companies, contracting etc. and finished goods such as consumer electronics, automobile, textile and more that are produced within the country in a given period. GDP serves as a comprehensive tool for assessing the current economic health of a country.

Despite the fact that GDP is usually computed yearly, sometimes it is calculated every 3 months or per quarter. In United States for instance, the US government is releasing their annual GDP estimate for every fiscal quarter and also, for calendar year. The data presented in the report includes real-time information. In US, it is the Bureau of Economic Analysis or BEA that is tasked to compute the GDP. They do this by utilizing data ascertained via surveys of builders, retailers, manufacturers and also, by reading trade flows.

Biggest Contributor in GDP Calculation

Computing the GDP of a country is encompassing all public and private consumption, investments, government outlays, paid-in construction costs, addition to private inventories, foreign balance of trade and everything in between.

Out of all elements that compose the GDP of a country, foreign balance of trade is the most important. Country’s GDP has the tendency to increase when its overall value of services and goods that domestic producers sell in other countries have exceeded the total value of the foreign services and goods that its domestic consumers are buying.

When such thing happens, the country then have surplus in trade. Now, assuming that what happened is the opposite where the amount that the domestic consumers are spending on foreign products are larger than total sum of the domestic producers can sell to its foreign consumers, then this is referred to as trade deficit. In such cases, the GDP of the country is more likely to drop.

Variations in Calculating GDP

There are many other ways of computing the GDP and some of it are:

Nominal GPD – this is evaluated at the current price of the market either local or international. This is done using the currency market exchange rate to be able to compare the GDP of the country primarily in terms of financial terms.

Purchasing Power Parity – short for PPP and is measured in international dollars. With this method, it is used to adjust the differences both in costs of living and local prices to be able ot make cross-country comparisons of real income, living standards and real output.