Verbal Bellringer1. Write “Computer Lab, CPU LAB 252– Econ”

for Monday Tuesday, Wednesday in your planner or on your phone

2. Why do you think people invest their money?

3. What is the opportunity cost of investing money?

Label Cornell notes

• “How does the Stock market work?”

• “Why do people invest?”

Questions or Comments

?????

?????

?????

Bellringer• Stocks• Bonds• Dividends• Stock Market• Stock Symbols• Stock ticker• NYSE, NASDAQ• Dow Jones• Bull vs. Bear• Industries

1 Make a KWL chart about the stock market and investing

Investing in the USA• Stocks

• Bonds

• Stock Market

• NYSE, NASDAQ

• Dow Jones

• Bull vs. Bear

• Industries

Savings Accounts

• 0% - 0.5 % interest

Investing

• Brokerage Account

• Old School – Stock Broker

• Higher fees, but advice

• New School – DIY online

• Lower fees, little to no help

A stock broker at work

• Finance degree

• Income: $50,000 and up

• Commission per trade

Famous InvestorWarren Buffett (1930-

One of 3 Richest people in the world ($52 Billion)

Successful investor

Earns only pays himself $100,000/year

“hold investments”

Bonds

• Government backed

• Very Safe

• Low risk

• Low return

• Loan for a time

• Corporations also offer them

Stocks• Ownership in a

publically traded corporation

• Issued to raise capital

• Some pay dividends

• Voting rights

Stocks

• Stock Calculation:• $25.90/share• You have $1000 to

invest in Disney• $1000 investment• $25.90 per share• You can buy 38.6

shares with $1000

• Dividend: $0.35 /year

Investment divided by share price = shares you can buy

Let’s try one

• $1,000 investment

• Someone name a large company

Stocks• Stock Calculation:

• $25.90 share price

• You own 38 shares

• Price $28/share

$28 X 38 = $1064 now!

Total investment = share price X shares owned

Stock Exchange• Stock Market

• Place where Stocks are traded

• Most famous: NYSE

• Wall Street

• Others: NASDAQ,

• Nikkei

• London

• Hong Kong

• Chicago

2011 New York Summer

Stock Symbols

• Makes trading easier

• EX: Disney = DIS

• Use finance.google.com to look them up

• Read a stock ticker

“Dow Jones”• Dow Jones” –

average 30 top companies

• MMM, AA, AXP, T, BAC, BA, CAT, CVX, CSCO, KO, DD, XOM, GE, HPQ, HD, INTC, IBM, JNJ, JPM, KFT, MCD, MRK, MSFT, PFE, PG, TRV, UTX, VZ, WMT, DIS

Bull vs. Bear Markets

• Bull Market

• Bear Market

Industries• Field of business

• Stocks follow others

• “Chinese increase car purchases”

• Tough times for biotechnology

Stock Market Game• $10,000 to invest

• Must spread out among 6 industries

• Winner: 2 excused assignments (December 6)

• http://www.marketwatch.com/game/pueblo-spring2012

Stock Market Simulation

Old School Stock Market Simulation• Sellers/Buyers

• 2 minute trading day

• 3 companies, Ford (F) , Campbell's (CPB), Adobe (ADBE)

Groups of 1-2

2. On a half sheet write down how much money Klein gave you

3 Write down your goal for this simulation

News of the Day

• American businessmen fear US government debt

• Consumer demand for soup increases by 10%

• Chevy announces new hybrid model

News of the Day

• Mexican tomato growers watch 80% crop killed

• President Obama announces increase in income taxes

• Adobe announces record breaking year

News of the Day

• US signs trade deal with Australia, tariffs on cars eliminated

• Consumer debt at an all time high

• US consumers frustrated with Indian tech support

News of the Day

• Gas price up to $5/gallon in US

• US computer companies sell 20% more computers last month

• US consumers get rebate check of $200

News of the Day

• US Unemployment Rate increases to 10%

• US tourism increases for the second straight month

• Microsoft announces new product to compete with Acrobat Reader

Final Stock Prices?

• Ford? OPEN: $1

• Campbell's? OPEN: $1

• Adobe? OPEN: $1

Closure• Write 3 “How” or “Why”

questions in question section

• Write your summary based on:

• “How does the Stock market work?”

• “Why do people invest?”• Use new vocabulary

Closure

4 How much did you finish with?

5 What effect did the news have on your investing?

6 Explain why you think this was a Bear or Bull market?

7 Fill in 3 things you learned today on the L column of #1

On your half sheet

6 How much did you start out with?

7 How much did you finish with?

8 What effect did the news have on your investing?

9 How well did you stick to your goal?

10 What would you do different if we were investing in the real world?

11 Explain why you think this was a Bear or Bull market?