Have you ever invested in the stock market? If so, do you know where your money is really going? The stock market is a risky business and it can make or break people’s lives. The stock market is used to daily to keep America on its trembling feet; it’s also being used at this very moment to cheat people out of money for personal gain. This happens every day in the stock market and its evolving rapidly, super computers that can trade faster than a blink of an eye, social media trends that can predict share values, and intricate stock market schemes that are getting harder and harder to find and take down. While the stock market keeps the world turning and the economy steady, the stock market is also being used in manipulative ways that are not always legal. What is the stock market? Businesses share part of the company by selling stock, or shares of ownership. When investors own shares of a company, that company is considered public because the general public has an ownership stake in that company. At the high ranks of the companies are the board of directors, whose job it is to make sure the business’s managers are working in the best interests of the multiple owners and shareholders. Companies sell shares so they can expand their businesses and make them better, such as by building manufacturing plants, buying other companies, and developing new and improved products to keep their business profitable. America’s railroads, steel manufacturers, car companies, and telephone companies all started with the help of money from opening up their business to the Stock Market. The Stock Market started in the 1920’s. People who were smart enough to buy them back then could build up a fortune since the market was growing so rapidly. One wh... ... middle of paper ... ...as up to, but he didn’t. he stayed at Stratton-Oakmont and continued his old ways, he learned that he was being investigated again and tried to hide all of his money in Swiss bank accounts but the banker he was doing business with got caught in America for sexual assault and turned Belfort in to get away with it. Belfort was exploited and arrested; he went “undercover” to incriminate his friends and other brokers to get less jail time. Belfort was sentenced to 2 years in a minimum security prison, which was more like a country club, and ordered to pay back 150 million dollars to the people and companies that Stratton-Oakmont had stolen money from. Belfort was released from prison and now speaks at investment seminars to help pay back the restitution of 150 million that he owes. If he does not pay it back in the next ten years, he will be ordered back to jail.
January 4th, 1898 was when the stock market was started. Everyone wanted to own part of a business. The way it worked was that the more stock you bought of one company. The more of a owner of that business you were. If that company were to become popular, than the price would go up because more people would want to be apart of owning that business. A bond is a lot different than stocks, Bonds are basically loans. At first the Stock market was conceived as a risky investment, but over time it became stronger and people started to trust it more and more. Pretty soon the New York Stock Exchange was booming with business. When more people started investing the price of stocks started to begin to increase. This occurred first in 1925. For the next year the price of stocks continued to go up and down. Then in 1927 they shot up.
Jordan Belfort throughout his entire life subverted the law for his own financial gain, always seeing money as worth the risk in the decisions he made. His decisions were made by a rational mind of his own volition, considering the long-term possibilities and how to stay ahead of his pursuers. He constructed an environment with Stratton Oakmont to enable this behaviour, as well as corrupt those around him to follow in his footsteps. This lead to his repeated violations of laws to generate wealth when his fear of punishment was lower than that of the rewards he could potentially gain. It was only when he was confronted with the reality of his punishment and experienced it directly that he was finally deterred from his criminal behaviour.
The Stock Market Crash marked a major turning point in the history of the United States. For decades the U.S. was the world’s leading superpower, but after the crash the country cascaded into the worlds most harsh depression. This crash was caused by a series of problems in the U.S. including, the over production of goods, unequal distribution of wealth and poor regulation of the stock market itself. Many can argue that the crash of 1929, strengthened the nation, allowing for policies such as roosevelt's first new deal, second new deal, the glass steagall banking act, and new regulations in the stock market, and for big business (Blumenthal, Karen). However, what can’t be argued is how the crash sparked a panic as companies, peoples, and the nation sank into the great depression.
During this period something known as the New York Stock Exchange arose that allowed even the most common person to invest in the huge corporations that ruled America’s industries. This market seemed very promising to many people and was growing faster than anyone could have imagined. In 1925 the value of all stocks in the NYSE were at about 27$ billion, but in only 4
"SEC Charges Bernard L. Madoff for Multi-Billion Dollar Ponzi Scheme (2008–293)". SEC.gov. U.S. Securities and Exchange Commission. December 11, 2008. Web. 8 April 2014.
Stock exchanges worldwide are complex, seemingly sentient centers of trade. Many transactions are processed at such exchanges and millions of dollars can change hands in an instant. Due to the immense number of transactions, fraudulent practices and backroom deals can thrive if they function unchecked. One such practice is known as insider trading. Insider trading is the practice of buying or selling shares of stock with knowledge of how well the company will do not available to all stockholders. Most people in the stock exchange community regard insider trading as amoral, corrupt, and unethical because of the fear that the trading might hurt or weaken the stock exchange itself. The size of the stock markets makes most traders fear a crash and exempts the market from the economic laws that govern the rest of the business world. If a person were to buy a car or a home wouldn’t he or she shop around for the best deal and attempt to gather all the information about the product they were buying if they could. The same could be said for finding a low interest rate on a loan and the same should apply to stock exchanges.
Before the great depression started, so many people said they couldn’t pay the banks back, which caused the banks to close down. During the late 1920’s American consumers were buying less, prices were rising and Americans were overbuying on credit which were to blame, problems with the economy emerged. Many American people were engaged in speculation- they were buying bonds, and also stocks hoping to make a quick profit. Americans were buying “on margin”- which is paying a small percentage of a stock’s price using it as a down payment and borrowing the rest of the money. A lot of Americans put all of their saved money into the stock market. On the month of September the stock market had some unusual movements increasing then decreasing, but on black Tuesday October 29, 1929, the stock market crashed. Lots of people lost all of their money. M...
The stock market is a vehicle to invest money. It is where consumers buy and sell fractions of companies, and is referred to as stocks. A proven method to achieve wealth while keeping up with inflation, comprised of publically held companies who offer goods and services that are used by the general public daily. Companies sell stocks to public investors in a free and open market environment on a daily basis, which is an effective strategy to build a sound financial future.
In the 1920s the USA had become a mixture of dramatic, social and political change. At this time the cities become larger and there were more people in the cities than in the rural areas. The US economy had more than doubled in strength between 1920 and 1929, this growth in wealth pushed America into the unfamiliar territory of the consumer society. Since Americans had extra money, they spent a lot of it on consumer goods like ready-to-wear cloths, home appliances and cars. However this wealth was only experienced by 40% of the whole population of America. It’s estimated that 60% of all American families lived below the bread-line. Despite this many Americans started to gamble their money in the American stock market. They saw the buying and selling of stocks would be an easy way to make money and because of this, many people bought stocks on the margin’. Buying stock ‘on the margin’ meant that the person couldn’t afford the stocks at full price, the broker could sell the stock to the person at a fraction of the price and the person could pay the broker back with interest at a later stage. The problem with this is that if the selling of the stocks didn’t make a profit, then the person would be in a lot of debt and this happened to many people that where living under the bread-line. Unfortunately despite this many Americans saw the stock mar...
Jordan Belfort is the notorious 1990’s stockbroker who saw himself earning fifty million dollars a year operating a penny stock boiler room from his Stratton Oakmont, Inc. brokerage firm. Corrupted by drugs, money, and sex he went from being an innocent twenty – two year old on the fringe of a new life to manipulating the system in his infamous “pump and dump” scheme. As a stock swindler, he would motivate his young brokers through insane presentations to rile them up as they defrauded investors with duplicitous stock sales. Toward the end of this debauchery tale he was convicted for securities fraud and money laundering for which he was sentenced to twenty – two months in prison as well as recompensing two – hundred million in restitution to any swindled stock buyers of his brokerage firm (A&E Networks Television). Though his lavish spending and berserk party lifestyle was consumed by excessive greed, he displayed both positive and negative aspects of business communications.
The stock market plays a significant role in the health of the economy; the economy has to be strong for a country and its citizens to prosper. In 1929 over a period of two weeks 30 billion dollars disappeared from the U.S. economy, this was the event that started the greatest period of human hardship of the twentieth century known as the great depression. On October 19,1987 the Dow Jones industrial average plunged almost a third of its value. Many investors went completely bankrupt after one day of trading. Both of these crashes came without warning in booming markets are the currently booming markets heading for a collapse? The current market resembles both 1929 and1987 markets but there is a smaller possibility for collapse.
Stocks an easy way to gain money but also a fast way to blow it all in my AG economics class we were given a task to perform and it was to gain money in the stock market. The middle class only makes 25,000 to 100,000 a year and to have the chance to learn how to flip that and double that money is skill evey one should know. I was given the chance to do and play around with fake money on the internet to learn how to manage stocks and manipulate them. Our teacher gave us a login to a game called the stock market game where we had to choose certain stock to see which ones would do better and if any of our stocks would crash. The game only let us choose from the New York Stock Exchange so the market wasn’t a wide variety of the whole market but it gave a small understanding of what it feels like to cash in or to be sitting in the dog house.
This case illustrated that there were real consequences to white collar crime. In addition to paying the fifty million dollar fine, he relinquished another fifty million dollars of his illegal trading profits. (He still had millions remaining, however, from his illegal gains.) His actual prison sentence was three years, yet he served only twenty-two months in the federal prison at Lompoc, California, which was known to have a “country-club” atmosphere.
During the 1920s, approximately 20 million Americans took advantage of post-war prosperity by purchasing shares of stock in various securities exchanges. When the stock market crashed in 1929, the fortunes of many investors were lost. In addition, banks lost great sums of money in the Crash because they had invested heavily in the markets. When people feared their banks might not be able to pay back the money that depositors had in their accounts, a “run” on the banking system caused many bank failures. After the crash, public confidence in the market and the economy fell sharply. In response, Congress held hearings to identify the problems and look for solutions; the answer was found in the new SEC. The Commission was established in 1934 to enforce new securities laws that were passed with the Securities Act of 1933 and the Securities Exchange Act of 1934. The two new laws stated that “Companies publicly offering securities must tell the public the truth about their businesses, the securities they are selling and the risks involved in the investing.” Secondly, “People who sell and trade securities must treat investors fairly and honestly, putting investors’ interests first.”2
Jordan Belfort is the notorious 1990’s stockbroker who saw himself earning fifty million dollars a year operating a penny stock boiler room from his Stratton Oakmont, Inc. brokerage firm. Corrupted by drugs, money, and sex, he went from being an innocent twenty – two year old on the fringe of a new life to manipulating the system in his infamous “pump and dump” scheme. As a stock swindler, he would motivate his young brokers through insane presentations to rile them up as they defrauded investors with duplicitous stock sales. Toward the end of this debauchery tale he was convicted for securities fraud and money laundering for which he was sentenced to twenty – two months in prison as well as recompensing two – hundred million in restitution to any swindled stock buyers of his brokerage firm. Though his lavish spending and berserk party lifestyle was consumed by excessive greed, he displayed both positive and negative aspects of business communications.