Economics - That's not got anything to do with the Stock Market!

Hi there again,

Actually, Economics has a lot to do with the stock market, and from what little I've read about it so far, from knowing virtually nothing, I'm seeing more and more benefit in understanding economics in general, as well as the 
economics of the company.

It's interesting to read that rewards for directors often have the opposite effect to that intended one.  You give someone a directive to make the share price go up, that doesn't mean that the share price can't go down first, making life easier.  That short statement is quite powerful if you think about it - if you can see incentives offered by the company to its managers, and those managers then manipulate that situation to their own benefit, you're probably not going to want to invest in them, or certainly you'd look very carefully before doing so.

Then you have the phenomena when a product goes up in popularity, and price probably, you can also get associated products that also go up in price as a direct result.  That's interesting, because if you know what to look for, for those products, you can monitor those stocks too, and get a measure of whether they're going to go up, shortly before they do so.

Then there's the situation of when income goes up, the amount of a product purchased goes up too, that would generally mean that that is an inferior product, so you might not want to look at that product, as it's success is based on factors other than it's own good management.

I'm still reading but these small bits of information are very enlightening when look at the stock market, the fundamentals of a company and so on.  Very interesting indeed.  I will give feedback as I read more points of interest.