Financial Statements 101
It's the result of revenue minus all expenses and often shared with the public as a dividend
What is profit?
What banks should pay it's customers for use of their deposits, typically less than 1%
What is an interest payment?
An approach to investing in assets with intrinsic value, as encouraged by famed hedge fund manager Bill Ackman
What is value investing?
Future steps or directions cannot be predicted on the basis of past history
What is Random Walk Theory?
The ability to step back from you assumptions and your emotions about money and observe them objectively?
What is Financial Intelligence?
The financial statement we read to determine a company's book value
What is a balance sheet?
This country is credited for being the founding nation of banking
What is Italy?
Warren Buffet's mentor
Who is Benjamin Graham?
The decline of purchasing power of a given currency over time
What is inflation?
It frees you from a dependence on money to handle your life
What is Financial Independence?
Famed investor who reportedly reads hundreds of these daily, even for fun at times
Who is Warren Buffett?
This investment bank proved to be insolvent during the 2008 financial crisis, filed for bankruptcy after its inability to satisfy its $613B debt
Who was Lehman Brothers?
Used to find the company profit
What is the Income Statement?
The theory where investor estimates what investment situations are most susceptible to public emotional influence?
What is castle-in-the-air theory?
Your Life's Energy
The annual financial statements are included in this filing report and required by law by the SEC
What is the 10-K annual report?
In personal finance terms, all your your assets minus your liabilities
What is net worth?
Used to determine the margin of safety
What is the balance sheet?
Looking at future cashflows and valuing them in today's dollars
What is discounting?
Learning the true impact of your earnings and spending, both on your immediate family and on the planet
What is financial integrity?
The three main statements of a financial report
What are the income statement, balance sheet, and cashflow statement?
This piece of legislation was meant to protect the consumer from an investment bank's high risk investments, by separating commercial banking from investment banking. It was passed in 1933 under the presidency of FDR.
What is the Glass-Steagall Act
A type of mutual fund with a portfolio constructed to match or track the components of a financial market index
What is an index fund?
An economic cycle that is characterized by the rapid escalation of market value, particularly in the price of assets.
What is a bubble?
Our ability to give and share our resources freely according to our values and priorities
What is financial interdependence?