It’s really all about two things: Supply and Demand.... That’s all.... Really.

Now a lot of people with vast arrays of initials behind their names (PhD, etc.) will tell you that it’s much more complicated than that, and that economists are indeed in great need. If you read the UPI or AP news wire, you could easily assume that economics is on everyone's mind. Continuously, if we are to believe all the hype. Now, I don’t have any fancy initials behind my name, but I did engage in the study of Economics for enough years to earn a BS degree, but that I don’t consider a BS to be very fancy. Additionally, I have taught the subject at the university level for many years - yes, without being published, tenured, or in possession of a fancy degree..... So I argue that it all boils down to these two things.

Just in this last years crisis (as with the now forgotten previous crisis) the vast majority of people have turned to economist’s for an answer - and by the way, they want that answer ‘right now’.... Also, during this crisis (as with the now forgotten previous crisis), economist’s are arguing amongst themselves as what the ‘correct answer’ actually should be.
Now a long time ago, when these economists were just starting out, they learned that economics is the study of how we manage our resources - scarce as they may be.... So it’s just about choices... Our choices, and how we (as a society) make these choices. So it’s about us, and it’s about choosing.... Supply and Demand.... It’s really that easy.

As people, we have needs, wants and desires - notice that I placed these in a particular order. Our first concerns are about fulfilling our basic needs - having enough food, shelter, clothing and clean water to drink (and I suppose we should throw in breathable air). Later, when these basic needs have been satisfied, we look around for other things that we want, and finally as we approach our zenith we develop a craving to fulfill all of our desires. This represents demand.
Now, all along this path we find resources, and people who have a ‘reason’ to use those resources to provide us with the things that we demand. This is supply.
I know that you’re thinking that the ‘reason’ will always be money, so I’ll dispel that now. While it may indicate money a majority of the time, this won’t always be true... As there truly are some things money cannot buy.

Over time, this simple concept has indeed become much more inter-twined and complicated, but if you boil away all the noise, it’s still just about Supply and Demand. People need, want and desire stuff, and other people are willing to fill those needs, wants and desires for a price (again, not always money).

So if Stock Market 101 and Economics 101 are really that simple, how did we get into this current mess? Well, we have to throw in a few more ingredients.

Next up.... Banking 101

So you think you know how the stock market works? Well maybe you do.... and maybe not.

First, I’d like to clear up some misunderstandings that many people have about the stock market (New York, Shanghai or ANY stock market). Stock markets are what are referred to as ‘zero sum games’, in that for every buyer, there must in fact be a seller. It always takes these two to tango in the market. There is someone who is buying the stock (for any number of reasons which I will discuss later), and someone on the other side who is selling this same stock, for whatever reason.
The company whose stock you are buying does NOT receive the money when you purchase these shares - IPO’s will be discussed in a minute - and the company whose stock you are selling is NOT paying you back when you sell your shares. Your transaction is always with another person, or entity. That is why these ‘stock markets’ are known as ‘secondary markets’. Basically you can think of them as the place where people go to invest (gamble) their money on a personal conceived notion or  ‘expectation’ that something 'good' will happen to it - like the price will go up (or down depending on your definition of 'good').....Please re-read this last sentence again...carefully....Although it is very basic, and is somewhat of a generalization, it holds true as it stands.

The only time that a given company actually receives money from the sale of their stock is during their IPO - Initial Public Offering, or any subsequent offerings that may take place from time to time. One truly good thing about IPO’s is that the price per share is generally set and doesn’t deviate during the sale just because someone rich, or some large mutual fund just purchased 1 million shares one milli-second before you. Once the IPO is completed - usually within several hours - it is these “initial” shares, and only these shares that are subsequently traded on the stock exchange. The number of these shares outstanding (or available for trading) does not change without a subsequent ‘public offering’ of additional shares. In other words, those shares sold at the IPO of a given company may then change hands in the secondary market on an daily, hourly, minutely or milli-second basis, but it is only these shares that can be offered for trade.

These secondary markets are ‘played’ by large insurance companies, mutual funds, BANKS, trust funds of large well-healed investors and little people like you and me. All are seeking to reap a reward. But we are only betting against each other - NOT the house, as there is NO house.....

I, like most people prefer the term ‘investing’, but before you lay your money down, you should thoroughly understand what you are getting into BEFORE you begin placing your bets.....