Stocks, Bonds, Options, and Economics

A couple of days ago I published a short video that I made to explain stock options. In planning to make that video I went back through my archives to look at some related resources that I've shared over the years. Here are some highlights from my archive of resources for teaching and learning about stocks, bonds, options, and economics in general. 

TD Ameritrade's YouTube channel offers a concise explanation of the difference between stocks and bonds. A much longer explanation is offered in this older Khan Academy video. 

TD Ameritrade also offers a concise explanation of how the bond market works and what bonds are used for (spoiler, they're not just for lame gifts from old uncles). 

Inflation Explained in One Minute provides a very basic explanation of the concept of inflation. It could be fine as a conversation starter or introduction to a lesson. However, if viewed on its own without additional information it might give students the impression that inflation is solely caused by changes in money supply. 



How Inflation Works is an excellent twelve minute video lesson produced by CNBC International. The video does a great job of explaining demand-pull inflation and cost-push inflation. Going beyond the basics the video also provides an excellent comparison of the economic theories of Milton and Keynes. Students will also learn how the consumer price index is calculated and how it is indicative of inflation. Finally, the video concludes with historical examples of inflation around the world and the causes of those hyper-inflationary episodes. I should note that the video will lend itself to introducing other concepts to your students including the importance of the federal reserve's interest rate.



If you or your students would prefer an animated lesson about inflation, The School of Life offers this solid explanation of cost-push and demand-pull inflation.



TED-Ed Lessons on Economics
TED-Ed has four lessons that could fit in well with a larger discussion and lessons related to inflation.

Why Can't Governments Print an Unlimited Amount of Money? explains the concept of quantitative easing in the context of the last two years.

What Give a Dollar Bill Its Value? explains the role of the Federal Reserve in trying to control inflation and deflation.

What Causes an Economic Recession? uses the context of the Bronze Age to introduce the factors that can lead to economic recessions today. Those include inflation, borrowing habits, saving habits, spending habits, and government decisions.

What Causes Economic Bubbles? uses the context of the tulip industry of the 1600's to explain what causes an economic bubble and what happens when it bursts.

How Does the Stock Market Work? is a TED-Ed lesson that provides a four minute overview of the origin of stock markets, why companies offer stock, and the basic factors that influence the prices of publicly-traded stocks. 

A Crash Course in Economics

Crash Course Economics is a thirty-six part video series. In it there are videos covering everything from the basics of supply and demand to the 2008 financial crisis to behavioral economics and a whole lot in between. 

60 Second Adventures in Economics

The Open University hosts a series of six short videos intended to introduce viewers to some of the basic concepts of macroeconomics. In 60 Second Adventures in Economics you will find short videos explaining things like the Paradox of Thrift and Comparative Advantage.

The Difference Between Stocks and Bonds

Last week I finished reading Liar's Poker written by Michael Lewis. The book is partly about his experience as a bond salesman at Salomon Brothers in the 1980's and partly about expansion of the bond market itself during the 1980's. The parts about how the bond market evolved to compete with the stock market in the minds of traders in the 1980's were the most fascinating parts of the book for me. I was telling a neighbor about the book over the weekend and she mentioned that she didn't know what the difference between a bond and stock really is. I gave her my brief explanation then turned to YouTube for a better one. 

TD Ameritrade's YouTube channel offers a concise explanation of the difference between stocks and bonds. A much longer explanation is offered in this older Khan Academy video. 

TD Ameritrade also offers a concise explanation of how the bond market works and what bonds are used for (spoiler, they're not just for lame gifts from old uncles). 

Applications for Education

Both of these videos could be helpful primers for lessons about the basics of financial markets and lessons about personal finance. With a free EDpuzzle account you can add multiple choice, true/false, and short answer questions into these videos. In this video I provide a complete overview of how to use EDpuzzle to create video lessons using videos that you find online.

Not Your Average High School Finance Lesson

Thanks to one of Gary Stager's recent LinkedIn posts I recently learned about an interesting high school investing and saving activity created by William Frey at Fryeburg Academy (just a few towns over from where I live). 

A Unit on Saving and Investing for High School Students appears to be created to coincide with the use of The Stock Market Game. In the unit students gather and compare data about financial then use that information in the construction of a portfolio. What's interesting about Mr. Frey's activity is that students will learn to use the Entity Framework in Wolfram's Knowledgebase to create and compile comparisons. (Take a look at this page for a demo of Wolfram's Knowledgebase for finance). 

Applications for Education
What makes Mr. Frey's activity outstanding is that it can be used to introduce students to programming concepts in the context of a real-world application (identifying and comparing publicly traded companies). This activity takes The Stock Market Game from manual analysis and speculation to programmatic selection. 

A Unit on Saving and Investing for High School Students is one of many projects featured on the Wolfram High School Summer Camp website. A couple of other projects that jumped out to me were Ranking US States by Flyoverness and Locate and Analyze Food Deserts in the United States. 

What Gives a Dollar Its Value? - Lessons on Currency

What Gives a Dollar Bill Its Value? is a nice TED-Ed lesson on the influence of the United States Federal Reserve banks on the value of currency. The lesson includes a short piece about the correlation between inflation and the overall health of the U.S. economy. The lesson is probably best suited to high school students who already have a basic understanding of how the value of currency is determined.


What Is Money? from The Atlantic's series on economics is a good complementary video to What Gives a Dollar Bill Its Value? What Is Money? uses the fun scenario of trying to deposit a banana into a bank to explain the basic purpose and function of money. The video is embedded below.

Videos - What Is Money? What Is Inflation?

As I've mentioned many times over the years, economics is one of my favorite subjects to teach. Some of my first lessons when introducing economics to students deal with the questions of "what is money? and "what determines its value?" The following short videos provide a nice introduction to the questions of "what is money?" and "what is inflation?" These videos won't replace my lessons, but they will be good supplementary material to share with students.


The following explanation of inflation is direct and to the point, but it does include a promotion for an investment website at the end.

National Financial Capability Challenge

Image Credit: Hammer51012

The National Financial Capability Challenge is an online test for high school students to test their knowledge of personal finance terms and concepts. The test was developed by the President's Advisory Council  on Financial Literacy. The challenge is open to students in the United States ages 13-19. The test is online now through April 8, 2011. To help students prepare to take the test the NFCC has published an educator toolkit that links out to thirty different lessons and activities designed to help students gain knowledge of personal finance.

The Charles Schwab Foundation is giving out twenty $1,000 scholarships to students in the top ten percent of students taking the test nationwide. Additionally, the Charles Schwab Foundation will give five $1,000 scholarships to students who score in the top ten percent and attend school in low-income areas. The Schwab Foundation will also give matching grants to the schools of the students who receive scholarships. Read more about the scholarships and grants here.

Applications for Education
Whether they're going into the workforce, into the military, or going to college after high school, financial literacy is something that all students should have. The lessons and activities included in the NFCC educator toolkit could help you make sure that your students have that financial literacy. In addition to the NFCC resources, I highly recommend the Financial Basics series of videos produced by Common Craft.

The Decade Ahead In Jobs

NPR has an interesting infographic predicting the growth and decline of various industries in the United States over the next decade. The Decade Ahead In Jobs uses 2008 statistics as the baseline for measuring growth or decline. One of the statistics of note from infographic is that, with the exception of pharmaceuticals, the manufacturing sector is expected to decline. Another interesting statistic is that the education sector is predicted to grow by 12%.

Applications for Education
The Decade Ahead In Jobs struck me as having a couple of applications for educators. First, on a theoretical level the predictions of this infographic and others like it should influence how we're preparing students for life after school. Second, The Decade Ahead In Jobs should be shared with students as a representation of the need for further education provides greater flexibility to adjust to future changes in workforce demands.

Interactive Timeline of the 08/09 Financial Crisis

Reuters has created an interactive timeline of the 2008/2009 financial crisis. The timeline begins in September 2008 and runs through today. Each element on the timeline links to a news article, image, or video about the financial crisis. You can browse the timeline as-is or narrow your viewing by selecting one of five topics; Living, Money, Reckoning, Rescue, or Work. Before exploring the timeline, I recommend viewing the introductory video.












Thanks to Jeffrey Hill for the link.

Applications for Education
The Reuters interactive timeline of the 2008/2009 financial crisis makes a nice companion to Say It Visually's video, Understanding the Financial Crisis.

Here are some related items that may be of interest to you:
The History of Credit Cards in the United States
Saving Money in Plain English and Other Economics Lessons
From Common Craft - Stock Markets in Plain English

Investing in Plain English

A couple of my classes are currently participating in a large mock-economy exercise designed to simulate the economic climate of the 1880's through early 1900's in the United States. We have a "Rockefeller," a "Carnegie," and a "JP Morgan" character is starting to emerge. Prior to starting the activity, I showed a couple of Common Craft videos to the classes as reinforcement for the banking concepts that we have discussed. The class watched Borrowing Money in Plain English and Investing in Plain English. I have embedded Investing in Plain English below. If anyone is interested in a digital copy of directions and handouts for the mock economy exercise, send me an email at richardbyrne (at) freetech4teachers.com and I'll send it to you.



Applications for Education
Common Craft has three videos that could be used in a business class, economics class, or in any setting that requires students to have an understanding of banking practices. Here are direct links to each of the three videos: Investing in Plain English, Borrowing in Plain English, Saving in Plain English.

Here are a couple of related resources that may be of interest to you:
The Crisis of Credit Visualized
Understanding the Financial Crisis - Say It Visually

The Crisis of Credit Visualized

Developing an understanding of banking, particularly lending practices, can be difficult for many students. Fortunately, there are some great Internet resources to help students learn about banking including two videos that I recently learned about through TEA (The English Adventure).

The Crisis of Credit Visualized is a two part video series explaining how lending practices and mortgages in particular contributed to the cause of our current economic situation.

Part One


Part Two


Applications for Education
These videos are probably too advanced for use in elementary schools, but could certainly be used in middle school and high school classrooms as part of a unit on economics.

Here are three other video resources that you might also consider using as part of a lesson on economics.
Saving Money in Plain English
Understanding the Financial Crisis - Say It Visually
The History of Credit Cards in the United States