Turukawa
  • Member for 11 years, 5 months
  • Last seen more than 1 year ago
Is inflation a good or bad thing? Why do governments want some inflation?
38 votes

Sensitive topic ;) Inflation is a consequence of the mismatch between supply and demand. In an ideal world the amount of goods available would exactly match the demand for those goods. We don't ...

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Why do people buy US dollars on the black market?
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23 votes

A falling exchange rate is an indication of falling confidence in a currency. Countries like Iran or Venezuela, with a managed exchange rate, set their exchange rates at a higher value than the ...

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Where do countries / national governments borrow money from?
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21 votes

"It's more complicated than that." Governments raise money in a number of ways. First, they tax economic activity within their borders and for connected companies and individuals. Then, some ...

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In a competitive market, why is movie theater popcorn expensive?
17 votes

To add to Jason's answer; a further mechanism is that of monopoly rents which you mention in your question. Movie theatres are often in shopping complexes (which themselves may offer a particular ...

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How can rebuilding a city/large area be considered an economic boost?
15 votes

You're entirely correct. It's one of those "broken window" fallacies. Have you ever witnessed the anger of the good shopkeeper, James B., when his careless son happened to break a square ...

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What should I look at before investing in a start-up?
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15 votes

Here are the basic questions I usually ask any new business startup: What is the one thing that they will sell that others will pay for? Who are those potential clients and how easy are they to reach?...

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What are the best strategies to give pocket money or an allowance to children?
14 votes

The value of money is not only in the earning and saving of it but also in the discipline in spending it. Any approach to teaching children about money must ensure a balance between the two otherwise ...

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Do Banks Cause Inflation? What are other possible causes?
13 votes

No, it isn't generally believed that inflation is caused by individual banks printing money. Governments manage money supply through Central Banks (which may, or may not, be independent of the state)....

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Are there any countries where citizens are free to use any currency?
13 votes

Wikipedia has a list of countries which ban foreign exchange use by its citizens. It's actually quite short but does include India and China. Sometimes economic collapse limits enforcement. For ...

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When is it better to rent and when is better buy in a certain property market?
12 votes

For US punters, the Centre for Economic and Policy Research has a Housing Cost Calculator you can play with. The BBC provides this one for the UK. For everyone else, there are a few rules of thumb (...

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When should I start an LLC for my side work?
12 votes

Not all of the reason to start an LLC is liability (although that is implicit). There are two main reasons as far as I have experienced it: Structural: There are many perks to having a registered ...

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Which practice to keep finances after getting married: joint, or separate?
11 votes

Echoing Justkt, different approaches will work for different couples. It also depends on your background, life experience, age, maturity.... If you're both older and have both earned an independent ...

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Do I even need credit cards?
10 votes

There are numerous reasons that go beyond the immediate requirement for access to credit. Many people just plain don't like carrying cash. Before electronic debit cards became mainstream about the ...

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Can you explain the mechanism of money inflation?
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9 votes

The mechanism of supply and demand is imperfect. Producers don't know exactly how many purchasers/consumers for a good there are. Some goods, by their nature, are in short supply, and some are ...

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No transaction fee ETF trades - what's the catch?
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8 votes

Banks often offer cash to people who open savings accounts in order to drive new business. Their gain is pretty much as you think, to grow their asset base. A survey released in 2008 by UK-based Age ...

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Is it a good investment for a foreigner to purchase a flat/apartment in China?
8 votes

I think a greater problem would be the protection of your property right. China hasn't shown much respect for the property rights of its own citizens - moving people off subsistence farms in order to ...

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Understanding company income statements: What is a good profit margin that would make it worthwhile to invest?
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7 votes

The short answer is that it depends on the industry. Retail: usually have low margins, 3-5% being a goodish range; some of the value traders can be even lower. Margin here is nothing compared to ...

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Why does the currency carry trade work?
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7 votes

As you say, the currency carry trade shouldn't work. The deluge of new cash into a high-interest currency should result in falling exchange rates. A November 2009 paper by Òscar Jordà and Alan ...

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What are the ins/outs of writing-off part of one's rent for working at home?
7 votes

Tax regulations vary from country to country - some permitting more deductions, some less - but here are a few guidelines. As regards the home-office: it must be a recognisable area (i.e. a room ...

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Are large companies more profitable than small ones?
6 votes

This isn't as rigorous as it should be, but may offer some useful insight into how big and small companies differ operationally. Putting Apple aside, larger companies tend to sell larger volumes of ...

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Applying for and receiving business credit
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6 votes

I'm afraid the great myth of limited liability companies is that all such vehicles have instant access to credit. Limited liability on a company with few physical assets to underwrite the loan, or ...

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How can a person protect his savings against a country default?
5 votes

These have the potential to become "end-of-the-world" scenarios, so I'll keep this very clear. If you start to feel that any particular investment may suddenly become worthless then it is wise to ...

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Why so much noise about USA's credit rating being lowered?
5 votes

Pension- and many "low-risk" investment funds may only invest in AAA-rated stocks and bonds. While the S&P rating alone doesn't imply that such funds must immediately disinvest in US bonds (Fitch ...

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Does it make any sense to directly contribute to reducing the US national debt?
5 votes

The US national debt isn't the problem. If the Bush-era tax cuts had been allowed to expire then US debt would have been paid off reasonably quickly. The CBO’s “baseline” budget forecast, which ...

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Do I need a business credit card?
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5 votes

It can certainly help build a credit score, but remember that businesses gain credit differently from individuals. Depending on the country, there isn't usually a national register of business credit ...

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What ways are there for us to earn a little extra side money?
5 votes

There are a number of ways and it all depends on your concentration and range of skills (or skills you're willing to develop). Programmer for hire: definitely, start with eLance.com and similar sites;...

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How to represent "out of pocket" purchases in general ledger journal entry?
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4 votes

You're lending the money to your business by paying for it directly. The company accounts must reflect a credit (the amount you lend to it) and a debit (what it then puts that loan towards). It's ...

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"Debt Settlement Order" Text Spams – How do they work?
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4 votes

There are likely to be two approaches: Number-generator: interested in collecting valid telephone numbers for onward sale; Service generator: interested in contacting the end-user for selling them ...

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School or retirement?
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4 votes

To make this more general: should you save for retirement or for education? The answer is simple: save for your education first. A PriceWaterhouseCoopers report on behalf Universities UK in 2006 ...

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Tuition Fees - Are British students who have already started their course affected by the recent vote to increase tuition fees?
4 votes

Course fees will go up for everyone from the next academic year. My reading on some of the changes to the original proposal which all relate to current and part-time students: Fees will go up for ...

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