Name: How The Stock Market Works In Under 8 Minutes
Uploaded: 2020-10-30T18:10:07.000Z
Duration: 8 min 8 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

- [Jeff] When you watch or listen to the news,

have you noticed that there are a few topics

While maybe easy to understand the weather

stock market news can feel like a secret code.

You know, some people make a lot of money somehow, but how?

If the stock market confuses you, you're not alone.

2/3 of adults are not financially literate.

It's not your fault schools don't teach this stuff,

Imagine taking a company and breaking it into

And when we say a lot of tiny pieces, we mean a lot.

Amazon, for instance, is made up of over 500 million shares.

When you buy a stock, you're buying one or more

you can only buy shares of public companies.

A public company is one whose shares are available

on a public market called a stock market.

While many large national companies are public,

In fact of the approximately 600,000 U.S. companies

with at least 20 employees, less than 1% are public.

and wanna live out your Willy Wonka fantasies

the company behind M&Ms, Snickers, and Skittles, too bad.

It's a private company so you can't buy any shares of it.

Instead, you might have to settle for Hershey's,

and so offers its shares in the stock market.

Now that we know what a stock is, let's go back to the news.

the price for pieces of public companies increased.

This doesn't mean every company's share went up,

people generally paid more for pieces for a company today

But when you hear the opposite, the stock market went down,

that means that on a whole the trader's paying less

for stocks today than they were yesterday.

You may hear things like the Dow was up today,

or the S&P was down today, but what does that mean?

The Dow and the S&P, also known as the S&P 500,

are bundles of stock that are actually considered

to be representative of the stock market as a whole.

Think of it as an appetizer sampler platter

with some pieces a lot of different things.

The Dow is a collection of 30 different companies,

While people often use the Dow or the S&P 500 as stand-ins

it is important to realize the stock market

is not a standard for how the economy is doing.

This may be counterintuitive since many of us associate

So big, so complex that it's actually hard to even define.

It encompasses different metrics like the employment rate,

and a myriad of other factors all interrelated

Because the economy as a whole is so big and complex

but the stock market is relatively easy to understand,

many people use a stock market as a substitute

in their minds for the economy as a whole.

Think of the entire economy like a football stadium.

about what's going on inside the football stadium:

but you never say the entire football stadium

In fact, there are times when the stock market

For instance, during the 2020 coronavirus pandemic,

The answer's in the fact that a booming stock market

only directly benefits those who own stock.

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How The Stock Market Works In Under 8 Minutes

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