How to read the financial pages
The subject of finance is very critical for the daily functioning of corporate organizations. Therefore, everyone should be financially literate. That’s why it’s important to review this book “How to Read the Financial Pages” written by Michael Brett. Brett is a freelance financial journalist, former editor of the “Investor’s Chronicle” and a frequent speaker on financial topics.
According to Brett, this text has been a great first-choice buy for anyone who wants a solid yet friendly foundation in finance and investing for over ten years. This author says that, by shedding the mystique of the world of investment and finance, the text is a guide for laymen to read and understand the financial press and the markets and events it covers.
Brett adds that, assuming you don’t have a financial background, the text offers a valuable explanation of how the financial world works, from money markets to commodity markets, investment indices and takeover bids.
This text contains 23 chapters. Chapter one is titled “First Principles.” According to Brett here, he writes about money and won’t be able to avoid technical terms entirely. He says that the simpler terms and concepts need to be dealt with early on because they will come up again and again. “Fundamental to all financial markets is the idea of getting a return on money. Money has to work for its owner”, affirms this author.
In short, it says that money can be deposited to produce an income and can be used to buy commodities or goods that are expected to increase in value but cannot, or can be invested directly or indirectly in stock market securities that they typically produce a but also show capital gains or losses.
This author emphasizes that there are many variations on each of these themes, but it is necessary to keep in mind the principles and the variations fit together. Regarding markets and interest rates, Brett explains that for each type of investment and/or many of its derivatives, there is a market. He adds that there is a money market in London and it is not a physical market, since transactions are carried out over the phone and the price a borrower pays for the use of the money is the interest rate.
In Brett’s words, “There is a foreign exchange market: the forex or currency market. There are commodity markets. And there are markets for government bonds and company shares: the main domestic market here is the London Stock Exchange. Much of what you read in the financial press about these markets, their movements and the investments that are traded in them.
He states that the important point is that no market is completely independent of the others and the linking factor is the cost of money. This author says that if interest rates go up or down, there is likely to be a wave of movement in all financial markets. He teaches that this is the single most important mechanism in the financial sphere and is behind much of what is written in the financial press: from the discussion of mortgage rates to the reasons for movements in the stock market. gold border.
“Money will gravitate toward where it will get the best return, depending on how risky the investor is willing to take and how long they can tie up their money,” Brett says.
Chapter two is based on the theme of money flow and money men. According to this author here, when a financial journalist describes someone as “an eminent figure in town,” he or she probably means what he or she says because the man may be a high-level member of the banking establishment. Brett adds that if a journalist describes someone as “the controversial financial city,” “he’s probably getting as close as he dares within defamation laws to calling him a financial rogue.”
But what exactly is this ‘City’ that is home to these characters and many more? ask this author. He says that it is, of course, a geographical area on the east side of central London, often described as the Square Mile, adding that ‘The City’ is more often used as a convenient umbrella term for commercial institutions in the heart of the British financial system. . Brett reports that they don’t necessarily operate within the square mile of the City of London, although a surprising number of them do.
He says they provide the financial services that grease the wheels of industry and commerce. According to him, one of the most common criticisms of the City is that it is too remote from Britain’s own productive industries. Brett says that while some parts of the City have always had an international perspective, the big change in the last 20 years is the internationalization of even the most traditional national institutions, such as the London Stock Exchange. “The City is a major source of invisible earnings for Britain’s balance of payments. Financial services generated net earnings abroad of nearly £32bn in 1998,” he reveals.
In chapters three through ten, this author examines concepts such as companies and their accounts; investment ratios; refine the figure; stocks and the stock market; what moves the prices of the actions in normal times and in the crack of 87; stock market launches; issue more shares and buy back shares; and providers, victims and legislators.
Chapter 11 is entitled “Venture Capital and Leveraged Acquisitions.” According to Brett here, to meet the different financing needs, there has been a rapid growth of venture capital funds, organizations that provide financing, sometimes a combination of equity and loans, but often just one or the other, for companies that they are not listed on the stock market.
This author says: “Because it is provided to finance unlisted companies, equity financing of this type is often referred to as private equity. Many of the venture capital funds are subsidiaries of existing financial institutions: commercial banks or compensation, insurance companies or pension funds.”
He reports that another tax-advantaged investment vehicle designed to encourage venture investment in private companies is the venture capital trust. A venture capital trust must have at least 70 percent of its investments in unlisted business companies — broadly speaking, the same type of company that would qualify for the Business Investment Plan, Brett adds.
This expert points out that the venture capital trust itself is very similar to an ordinary investment and must be listed on the stock exchange.
In chapters 12 to 19, the author analytically analyzes concepts such as pay, benefits and reverse capitalism; government and corporate bonds; banks, borrowers and bad debts; money markets; currencies and the euro; international money; financial derivatives and raw materials; and insurance and Lloyd’s after the problems.
Chapter 20 is entitled “Commercial Property and Market Collapses.” According to this author, commercial property (ie office buildings, shops, factories and warehouses) has been one of the main avenues of investment for insurance companies and pension funds. Brett adds that it was less popular at the turn of the millennium than before.
He says there is, however, no central market in commercial property, emphasizing that the “market” is largely organized by major firms of chartered surveyors or real estate agents. Brett explains that these companies offer a range of real estate investment services. “They advise on property portfolios, often manage portfolios on behalf of institutions, provide valuations, negotiate leases, purchases and sales, and help arrange development financing,” the author adds.
In chapters 21 through 23, Brett shines his intellectual spotlight on concepts like saving, joint investment, and tax havens; supervise the City; and the financial pages in terms of print and the Internet.
As for the style, the book is a success. For example, the book is well presented and the language is standard and simple, making it easy to understand the subject despite the technicality of the terms. The stylistic hit was expected, given that Brett is a freelance financial journalist and, by implication, a financial communicator.
The depth of the book’s research is also commendable.
However, the definite article “The” constitutes a structural redundancy in the book’s title. That is, the title should have been “How to read the financial pages” and not “How to read the financial pages”.
Overall, this text is a masterpiece on financial education. It is highly recommended for anyone who is ready to expand their knowledge financially.