Understanding the Financial News
Nicholas G. Apostolou, CPA, DBA
D. Larry Crumbley, CPA, Ph.D.


People are bombarded with financial and economic information on a daily basis. Reports on such items as the GDP, unemployment rate, consumer price index, and the money supply are publicized not only in the financial news but also in our local newspapers. Anyone reading the financial pages or front page is faced with a bewildering array of stock tables, price quotes, and predictions of future trends, often contradictory in nature. The concerned nonexpert may find it a daunting task to synthesize and integrate this information so as to make specific economic decisions.

This book is for those individuals who wish to understand the implications of the financial news. This understanding does not require you to be an expert. Rather, the goal is to permit you to make an informed appraisal of the information reported in local newspapers, national financial newspapers such as The Wall Street Journal and Investorís Business Daily, television, weekly financial publications such as Barronís, and the business periodicals such as Business Week, Forbes, and Fortune.

 This book is by no stretch of the imagination a theoretical treatment of finance, economics, or investments. For example, textbooks that deal with economics can be dull and forbidding, and they generally fail to provide elementary information on when economic information is reported and how you should interpret that information in making economic decisions.

 Similarly, most finance and investment books are either too theoretical or too personal, espousing the authorís system of amassing riches. This book does not provide you with a foolproof system of becoming wealthy. Rather, it presents fundamental material from the areas of economics, finance, and investments to enable you to interpret the financial news with a little common sense and sophistication. In this way, you can form your own opinions about current economic and business events rather than looking for so-called experts to interpret them.

 We are not suggesting that you dispense with expert advice. The point is to form your own opinion based upon the facts, so that you are better able to judge the validity of the advice of others. Otherwise, you donít have an independent check on other opinions.

 The book Keys to Understanding the Financial News is organized around "keys" to understanding the financial news. The purpose of each of these discussions is to provide you with sufficient information to interpret the financial news and make economic decisions. It is a practical how-to book, rather than a theoretical or conceptual discussion. Specific examples are presented from the daily press to illuminate discussion of the keys. Further, at the end of the book, a glossary is presented along with a series of the most commonly asked questions.

Last Updated: 21 December, 2000