This book is a good introduction to the principles of the macro economy. The author explains the basics of the federal reserve system, monetary policy, the causes and effects of inflation, and various personal investment products such as stocks, mutual funds, commodities, and money market accounts. The basics of each is explained, and the author shows how each is tracked daily in the Wall Street Journal. The purpose is to allow individuals to understand their investments, track their progress, and be able to react to changing market conditions. Its all sounds very axiomatic, but the great thing about this book is that it states basic principles that are often assumed, and thus left unstated.
For example, if the following excerpts are helpful to you, then this would be a great book for you:
Page 15: "The forces of supply and demand condition every business cycle."
Page 25: "Bank lending finances spending, and spending generates inflation. The Fed controls bank lending and can thereby control inflation."
Page 33: "Every commodity has a price; the interest rate is the price of money. As with any commodity, the price fluctuates according the the laws of supply and demand."
Page 165: "Mutual funds are popular with individual investors because they permit diversification in a wide variety of securities with a very small capital outlay."
These are examples of the points covered, and the level at which they are covered. If the above quotes sounded obvious, this book may be below your expertise. But if you finally want to understand the jargon you hear on CNNfn, this book will do the job.
This would be a great book to buy as a graduation gift for a high school senior, or anyone without a background in finance.
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