Sunday, January 06, 2008

Financial Illiteracy

Once again I am amazed by the lack of financial literacy in this country ~

From “Richistan” by Robert Frank:
At a summer camp for young Richistans (a term coined by Frank to describe the nouveau riche - a group of self-made entrepreneurs with wealth that equals or surpasses old money) - One of the rich kids asks the question, "So is the stock market the same the as a mutual fund?" Most members of the group looked stumped.

A stock represents a share of partial ownership in a corporation.

A mutual fund offers partial ownership in a professionally-managed group of collective investments that pools money from many investors and invests it in stocks, bonds, short-term money market instruments, and/or other securities.

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