Chats

First of all, let’s get the pronunciation out of the way; bear is pronounced /beə/, rhyming with “hair”. Don’t make the terrible mistake of saying “beer” /bɪə/ (which rhymes with “here”), nobody will be impressed.

So, what is this animal doing in financial markets? Well, A bear is an investor who’s downbeat about the economic situation, pessimistic about the market and so thinks that the value of an asset, or of the market as a whole, is going to decline.

Consequently, a bear market is a pessimistic market in which asset prices fall for a prolonged period of time – more technically, it’s when prices have fallen 20% or more after a recent peak.

“World markets are bearish due to the impact of the coronavirus and fell across the board in yesterday’s trading”.

“bear markets are usually characterised by investors arguing themselves out of buying. That’s why we always miss the bottom.”

Merryn Somerset Webb Financial Times March 13 2020

A popular saying is

“the best thing you can do in a bear market is play dead”

i.e. sit tight and wait for things to pass or maybe invest in liquid, short term instruments.

The adjective relating to bear is bearish

Japanese stocks are well placed to confound the sceptics. From coronavirus to corporate governance changes, foreign investors are too bearish

Financial Times February 11 2020

while the opposites to bears and bearish are bulls and bullish.

Generally speaking, there is a deficit when an amount falls short, or doesn’t attain or reach, a required level.

Those with a moral deficit put on a good show, and sleep like a baby.

Paul Newman

the Philippines looks to geothermal energy to reduce its energy deficit on the island of Mindoro

Financially and economically speaking, there is a deficit when more money is spent than received i.e. outflows of money exceed inflows of money.

Many governments have run deficits since the financial crisis, that is they have spent more money than they raised through taxation. However, this can be controversial as some politicians view running a fiscal deficit as “living above your means“.

Armed with a $6.4 billion arsenal to fight the coronavirus and its fallout on the economy, this year’s expansionary Budget could run a historic deficit of $10.9 billion – the highest in recent times.

Straitstimes.com February 19 2020

A trade deficit refers to an imbalance between the amount spent on imports and the amount earned on exports.

Trump has pledged to narrow the trade deficit and bring manufacturing back to the United States

CNN February 5 2020

Related words are the adjective “deficient” and the noun “deficiency“

Although he boasts about his negotiating skills, they appear somewhat deficient.

Health care systems around the world denounce deficiencies in medical supplies.

What is the opposite of a deficit? If you are a Spanish speaker then maybe you fall into the common mistake of saying “a superavit” which, while it may bring smiles to many faces, won’t forward your career. It’s not a superrabbit,

it’s actually a surplus.

And I leave you with something to ponder, or think long and carefully about, is it possible to have a moral surplus?