Featured Napkin
The Fed
Making a Federal Case
The Fed is the central bank of the U.S. Its overarching role is to make sure that the country’s economy and financial system function smoothly.
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NFTs
(Not So) Real World
An NFT, or non-fungible token, is a code that says you own a unique digital item.
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P/E Ratio
At Any Price
The price-to-earnings ratio (or P/E ratio) is a way to evaluate whether a company’s stock is cheap,...
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Quantitative Easing
Easy Money
Quantitative easing is when the Fed (or another country’s central bank) buys up large amounts of bonds....
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Invisible Hand
Helping Hand
The “invisible hand” is an economic theory developed by Adam Smith. It proposes that when people act...
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Game Theory
Roll the Dice
Game theory is an economic model for predicting people’s decisions in tricky situations.
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Fiscal vs. Monetary Policy
Tax and Spend
Fiscal and monetary policy are two tools the U.S. government can use to help the economy stay...
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Recession Shapes
Give Me a V
A recession is an economic downturn that lasts for at least several months and ripples throughout the...
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Campaign Finance
Follow the Money
Campaign finance describes the way political candidates raise and spend money to run for office.
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Volatility
Rocky Road
Volatility describes how much an investment bounces around in price. More volatile investments zigzag in price more...
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Valuing a Company
What’s it Worth?
A company’s value is the dollar figure that it might sell for if a person or another...
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Futures
Looking Ahead
A futures contract is an agreement to buy a specific investment at an agreed-upon price on an...
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Forex
Hard Currency
The foreign exchange, or forex, markets are where investors go to buy and sell currencies. Unlike the...
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Inflation
On the Up and Up
Inflation is when prices of things rise over time. For example, in 1980 you could buy a...
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Tariffs
Barriers to Entry
A tariff is a tax charged on goods coming into or out of a country. When a...
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Cryptocurrency
Tales of the Crypto
Cryptocurrency is digital money that can be sent electronically anywhere in the world.
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Bitcoin
Not So Silky Road
Bitcoin is the world’s first type of digital money, or cryptocurrency. Unlike traditional paper money, Bitcoin only...
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Bull or Bear Market
Into the Wild
Wall Street may be a bit of a rodeo, but there are no literal bulls or bears....
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GDP
Grossly Underrated
Gross domestic product, or GDP, measures the size of an economy. In essence, it puts a dollar...
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Break-Even Point
Point Break
A company is at its break-even point when its revenue equals its expenses. It is neither making...
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IRR
Crunch the Numbers
The internal rate of return, or IRR, is a measure of an investment’s or a project’s profitability....
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Financial Statements
State of Affairs
Financial statements are reports a company puts together to measure how it’s doing. Companies create their financial...
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Profit and Loss (P&L)
The Bottom Line
A profit and loss statement, or income statement, shows the money a company earned and what it...
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Remittance
Check’s in the Mail
Remittances, also known as remittance transfers or international wires, are when someone in one country sends money...
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Overhead
Keep the Lights On
Overhead refers to the expenses a business must pay just to stay open. Also known as “indirect...
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Blockchain
Chain Gang
Blockchain is the recordkeeping technology that serves as the foundation for Bitcoin and some other types of...
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Bankruptcy
Lose Your Shirt
Bankruptcy is the legal process for consumers or businesses to get help with their debt. Bankruptcy starts...
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Options
Coming Attractions
An option is the right, but not obligation, to buy or sell an investment at a specific...
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Recession
Feel the Pinch
A recession refers to a time when the economy shrinks instead of grows. More specifically, economists typically...
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Fixed vs. Variable Costs
At All Costs
Fixed and variable costs are types of expenses that businesses pay in order to operate.
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Equity
Own It
Equity is ownership. You can have equity—or an ownership stake—in any asset, meaning anything of value.
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Liquidity
Cashing Out
Liquidity refers to how easily you can sell an investment or asset at a fair price.
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ROI
Many Happy Returns
Return on investment, or ROI, is a ratio for measuring the profitability of an investment. It puts...
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Balance Sheet
Cook the Books
A balance sheet is a snapshot of financial health, showing what a company or person owns and...
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Currency
All About the Benjamins
Currency is anything that people use to store value or trade for goods or services. Currency can...
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Commodities
Back to Basics
Commodities are raw materials. They are the inputs, or ingredients, that are used to make most of...
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Fiduciary Duty
Your Best Interest
A fiduciary duty is a legal obligation to act in another person’s best interest.
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Economies of Scale
The Bigger, the Better
Economies of scale occur when it’s cheaper to produce a lot of something than it is to...
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EBITDA
How You Slice It
EBITDA (pronounced “ee-bit-tah”) stands for “earnings before interest, taxes, depreciation, and amortization.” It’s one measure of a...
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Profit Margin
Margin of Error
A company’s profit margin measures the portion of its total sales that it gets to keep as...
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Liability
Much Obliged
A liability is something that will require you (or a company) to spend money or resources in...
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Opportunity Cost
Fork in the Road
Opportunity cost is the return or benefit you miss out on by choosing one option over the...
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Depreciation
Wear and Tear
Depreciation is a physical asset’s loss of value over time. Just as your once new car is...
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Securities
Market Maker
“Securities” is the term used to describe stocks, bonds, mutual funds, and other types of financial investments....
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