Wall Streeters are used to tight security on a daily basis, but Wednesday it was taken to an ever higher level as President Bush was in town. Bush made an impromptu visit to the New York Stock Exchange after he delivered his State of the Economy speech at Federal Hall (the site where George Washington was inaugurated as the first POTUS). Bush's speech focused on the size of corporate executive pay packages. His visit to the NYSE marked only the second time a current U.S. president visited the floor of the Exchange during trading hours. Ronald Reagan was the first president to visit the NYSE to salute "the robust American expansion" on March 28, 1985. Bill Clinton visited the NYSE in early 2000 as president, however appeared after the markets had closed.
The president left the exchange floor before the Federal Reserve announced it was leaving interest rates unchanged. Stocks immediately rallied after the Fed decision as investors took the central bank's statement to mean that policymakers were less worried about inflation. In today's trading, the Dow's split personality emerged yet again as traders worried that the Fed's stance will hurt corporate profits. And down at Gobbler's Knob this morning America's most famous forecaster shook the snow from his fur and failed to see his shadow, portending an early Spring. Oil traders discounted Punxsutawney Phil's optimism and relied on Accuweather.com's forecast of colder weather in February to drive oil prices north. Despite all the mixed messages emanating from the economic data, the Dow set a record on Thursday locking in solid gains for many investors.
Unfortunately solid market gains do not always trickle down to the average person's bank account. The Commerce Department reported today that the personal savings rate for all of 2006 was a negative 1 percent, meaning people spent all that they earned, as well some of their savings and/or financed purchases through loans. The 2006 figure was the poorest showing since the height of the Great Depression in 1933.
According to a Securities and Financial Markets Association (SIFMA) retirement study conducted last year, fully half of the 77 million Baby Boomers will not have the means to sustain their current standard of living once they reach retirement, due to lack of savings. That's more than the entire population of Canada! Please share this bit of news with your Stock Market Game students and encourage them to start saving now!
Speaking of the students, the president wasn't the only one to experience the excitement of the NYSE this week, this morning a couple of Ohio Stock Market Game teams rang the Opening Bell. Their game began last October 2 and ended in December. The winning middle school team made a 25.3% profit and the winning High School team made a 44.9% profit. Be sure to check out their
Want to teach a great lesson that gives your students an overview of the various exchanges? Be sure to check out the
What is an Exchange/Market?
lesson in the
Teacher Support Center . This lesson focuses on the functions of the various stock exchanges. Students will be able to define a stock exchange, determine which exchange handles their SMG stock transactions, and understand the pros and cons of listing with the NYSE, Nasdaq, and AMEX. You can access the lesson in the Lesson Sequence section of the Teacher Support Center.
This article was written by a staff member of The Stock Market Game.