The stock market and the economy

The Stock Market and the economy
Today, it is very common to talk and hear about “The stock market”; more and more people are involved in buying and selling shares. Market is a constantplay of ups and downs; people who decide to participate in the stock market should have certain knowledge about it and be patient to get better results. At the same time, market is veryuncertain because people do not really know how much more a share is going up or down, if we should sell it or not, or if it is going to recover; that is way you have to speculate further apartfrom economic indicators, then make decisions which can lead you to gain or loss money. Thus as the stock market affects the economy of its investors, it also affects the country’s economy.Selling shares is a way to get liquidity for a company, and then causes the company to continue operating; a company without liquidity can go bankrupt, as a result many workers would be leftunemployed, as consequence they do not have any income to spend in the market, and this negatively affects the country’s economy. On the other hand, if a company is working and increasingits profit, then its shareholders increase their incomes; shareholders with a higher income are able to spend more money in the market, then it positively affects the economy.
Anothernegative consequence in a rapidly decline in a stock prices is a possible recession; recession brings a considerable diminishing in the GDP of the country which causes an oversupply of goods thatpeople do not want to buy because of the uncertainty of the financial progress.
In conclusion, even though, the markets are regulated and there are some economic leading indicators to avoidrecessions and other financial problems of society, there is always a chance of failure. However, people shouldn’t get away of investment because it is part of the economic growing.