What Do Love and Loyalty Do For a Person Essay Example For Students

What Do Love and Loyalty Do For a Person? Essay Everybody has felt love in his or her life. Whether it was for a pet, a favorite toy, or another person, love has been involved in everybodys life in someway, shape, or form. Loyalty is another very common feeling, however, not as many people may have felt this way, or recognized it as easily. Loyalty can be defined as the devotion to another person or an organization. At times these two can be coupled together to form an excellent relationship. For instance, in the book, All Quiet On the Western Front, the narrator feels loyalty towards his commanding officer and soon realizes that it is also love that he feels towards him. This can easily be shown by the quote from the book, now we sit with a goose between us and feel in unison, are so intimate that we do not even speakI love him In this instance the amount of loyalty was so great that love was shared between two grown men in the middle of a war. When these two are coupled together an overwhelming sense of attachment takes place and one would do anything for the other and them in return. Loyalty is definitely needed for every person so they may feel part of something. If they feel loyal to someone or a group then they will at least have respect for that person or group. With respect eventually comes love. Loyalty is the base of love. It is hard to feel love for something that is not liked. And in a sense if you like something then you are loyal to it. A person needs loyalty so they can have respect and love for something. When they have respect and love for something then they have it for themselves. At that point it is hard to take this person down in any way, because they feel that they are a part of a group, or have a superior friendship with someone, and feel as though they have someone to back them up. Thusly, they are more willing to stand up for what they believe in and are more likely to have great inner strength so that they can take on anything. Like war. War is a major place where you need loyalty. If you dont trust the person next to you or the organization youre fighting for then you are not as willing to give everything up. Which, if you think about it, is what loyalty really is. As mentioned before, loyalty is the bases for love. If you dont feel dedicated to something you cannot feel love for it. Love, in a sense, is loyalty. Love is that burning desire to do what ever it takes to help or be there for what is loved; a feeling of loyalty. Every person needs to feel love because every person wants to be loved. With love is a greater sense of trust. Love is the best feeling in the world and each person should be willing to do anything for what they love. If love is not felt than a person cannot stand up for what they believe in and certainly cannot fight in a war. This person needs to feel love for the organization they are fighting for or, at least, their comrades. If that love is not felt than they will not give their all to defend what they believe in or help their fellow citizens, friends, and family. In the end, a person cannot survive without love and loyalty. It is so needed that people cannot deal with themselves, not to mention the others that they should or would like to care about. Love and loyalty do so much for a person. .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 , .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .postImageUrl , .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .centered-text-area { min-height: 80px; position: relative; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 , .u2b96c3a0dafa527a5cb9ea6c35ae5fd1:hover , .u2b96c3a0dafa527a5cb9ea6c35ae5fd1:visited , .u2b96c3a0dafa527a5cb9ea6c35ae5fd1:active { border:0!important; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .clearfix:after { content: ""; display: table; clear: both; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 { display: block; transition: background-color 250ms; webkit-transition: background-color 250ms; width: 100%; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #95A5A6; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1:active , .u2b96c3a0dafa527a5cb9ea6c35ae5fd1:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #2C3E50; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .centered-text-area { width: 100%; position: relative ; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .ctaText { border-bottom: 0 solid #fff; color: #2980B9; font-size: 16px; font-weight: bold; margin: 0; padding: 0; text-decoration: underline; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .postTitle { color: #FFFFFF; font-size: 16px; font-weight: 600; margin: 0; padding: 0; width: 100%; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .ctaButton { background-color: #7F8C8D!important; color: #2980B9; border: none; border-radius: 3px; box-shadow: none; font-size: 14px; font-weight: bold; line-height: 26px; moz-border-radius: 3px; text-align: center; text-decoration: none; text-shadow: none; width: 80px; min-height: 80px; background: url(https://artscolumbia.org/wp-content/plugins/intelly-related-posts/assets/images/simple-arrow.png)no-repeat; position: absolute; right: 0; top: 0; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1:hover .ctaButton { background-color: #34495E!important; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .centered-text { display: table; height: 80px; padding-left : 18px; top: 0; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1 .u2b96c3a0dafa527a5cb9ea6c35ae5fd1-content { display: table-cell; margin: 0; padding: 0; padding-right: 108px; position: relative; vertical-align: middle; width: 100%; } .u2b96c3a0dafa527a5cb9ea6c35ae5fd1:after { content: ""; display: block; clear: both; } READ: Saint Martin Essay It makes them feel whole and adds to their need of being accepted by their friends, family, co-workers, and any major organization, such as a country. Love and loyalty take a person much farther once these feelings are felt. These feelings may become so overwhelming that they are willing to die for what they are feeling love and loyalty for. .

Creating a Sample Academic Essay For Your Course

Creating a Sample Academic Essay For Your CourseIt is really easy to create a sample academic essay for the course you are taking. However, in order to get this out of your head you will need to find an outline that you can actually work with. This will give you some guidelines and ideas on how to go about it. Just remember, this is not going to be perfect and you still have to pay attention to grammar and spelling, so keep these things in mind.The first thing you will want to do is look at your ideas and see what you have written in your sample academic essay. If there are any areas where it might be hard to write a proper and honest essay then you may want to try to add in something else so that you can focus more on the details. For example, you may think that you don't know anything about the topic or idea you are writing about. This is something that can be taken care of by adding more information, but you have to make sure that it isn't too much.The next thing that you should d o is research about the student life and the school that you are attending. Make sure that you are comparing the school to the rest of them and making sure that they are comparable. You will want to make sure that they are all going to be equal when it comes to the cost, education, and other things. You should also compare the standard of living of the students with that of the faculty and teachers.After you have researched about the school and the students you should now have your basic ideas on the topic. Next, you should decide if you are going to include a topic in the middle, or if you are going to write each of these sections separately. Just remember that this is a guide for you and not a complete course guide.There are many ways that you can write on a topic and you will have to decide which one best fits you. One of the main topics that you can write on is writing as a way to handle stress. Most of the time, this is something that we have to deal with as human beings. Of co urse, there are plenty of different ways to write a chapter, but you should make sure that you come up with something that will be very short and easy to read.Once you have decided on the topic, then you should use this as your main guide. This way, you will be able to write and get everything done in time. Just remember that you are supposed to keep your details short and simple, so be sure that you include only the most important points.Writing a sample academic essay is something that you can easily get started on. The only thing that you have to remember is that you need to keep these tips in mind while you are writing.

Shortage Of Labor Essays - Labour Economics, Ageing,

Shortage Of Labor One of the major concerns of today's companies is the shortage of labor, especially in management. The baby boomers are nearing retirement age in the United States and the birth rate is dropping. These circumstances, coupled with the booming economy are the main causes of the labor shortage. There is a high demand for labor but the once seemingly bottomless pool of employees and managers that companies drew from has started to dry up. What are the factors that contributed to the problem and how are today's corporations going to handle this problem? The type of labor needed in today's society has been undergoing a constant change. There is an increase in demand for workers but there is a much greater demand for educated white-collar workers, especially management material. Projections state that the growth in managerial positions will increase 20% by the year 2010 yet the population aged 35-50 will decrease nearly 10%. What these figures say is the already diminishing supply of executives is going to dwindle even more over the next 10 years. There is a shortage of blue-collar workers now and there will also be an even greater shortage of them in the future. In order for employers to find people who are willing to perform unskilled, repetitive jobs they are going to have to be willing to raise the level of compensation offered to employees. If McDonalds needs someone to flip hamburgers they better be prepared to pay double to triple minimum wage. There are a wide variety of employment opportunities and today's workforce can afford to be selective when choosing a job. The demand for employees is high while the supply is low. The figures on the change in average population ages and growth in industrialized nations is beginning to make the corporate world stand up and take notice. If the trends continue as they have been for the past thirty years, the shortage of labor is going to continually get worse with each year that passes. The predictions from the United States Census Bureau state that between 1990 and 2000 the increase of the American population over 60 will be 10.5% but in 2010 to 2020, the increase will be 32.5%. The change in the 60 plus population in the United States is projected to nearly triple in thirty years. Compare these figures to the increase in under sixty-year-old population. From 1990 to 2000, the increase in under sixty year olds will be 6.5% and it is projected to drop to 2.8% by 2010. If you look at the changes in the workplace you will see that the average age of an employee is steadily rising as the average age of retirement continues to drop. The projected increase in 55-64 year olds in the workforce from 1996 to 2006 is a staggering 54%. The projected change in the 25-34 year old bracket is -8.8%. These trends are not only true in the United States. Japan is also going to be coping with similar problems. Today the people over age 65 compose 16% of Japan's population, but by the year 2020 it is projected that percentage will soar to 26.3%. Japan, just like the United States is going to have to attempt to retain some of this group in the workforce to compensate for the continually falling birthrate in their country. This problem is very true in Europe too. Since 1995 Germany, France and Italy have experienced a continual fall in working population ages 15-64. This trend is projected to continue into the year 2000. Our aging population is also choosing to retire much earlier than they once did. This is a factor contributing to the strong economy we are enjoying now. The old are growing older, living longer and they are healthier than ever. Breakthroughs in medicine have enabled people to live much longer. The advancements our pharmaceutical companies research and development departments have made are staggering. Diseases that once were a death sentence are curable. Organs that are failing in the human body can be replaced or rebuilt. There are even some types of cancer that are considered curable. These things were not true twenty years ago. There also is a trend in this country towards remaining healthy. Americans are taking much better care of themselves; there is a genuine concern towards health. People are not smoking as much as they did in previous decades and there is a trend towards exercise. We take vitamins, we go out for a weekend run or bike ride and we

Telecommunications in the Caribbean essays

Telecommunications in the Caribbean essays The world has undergone a dramatic change in the last 30 years. Each day, the revolutionary changes in technology bring us closer and closer together. Surprisingly, access to information brought along by technology is replacing the importance of access to natural resources as the main determinants of the socio-economic position of nations. While studying the effect that technology is having on the world, it is good to focus on a particular region. The Caribbean has proven to be a microcosm of this world-wide phenomenon. The Caribbean is comprised of mostly small island nations with small populations that were colonized by the European powers in the late 1500s. The native people of the region are now long gone, due to the genocide that happened to accompany the colonization process. Since then, many ethnic groups have made their way to the Caribbean. Groups such as Africans, Chinese, East Indians, and Javanese occupy the islands. In addition to this, English, French, Dutch, and Spanish are the official languages in various countries throughout the region. Such an assortment of ethnic groups and languages creates a region rich in customs and traditions, a factor that can often hinder development. Although the Caribbean is not a rich or heavily populated region, it is still a major Telecommunications Market. Contrary to popular belief, many countries in the Caribbean have Telecommunication infrastructures that are as advanced as those in the rest of the world. Much of this is due to the proximity to North America. However, the most important reason for the Caribbean being a major telecom market is the importance of the tourism industry to the economies of the Caribbean countries. In contrast to this, the poor throughout the Caribbean do not have access to telephones, let alone their own lines. Thus, the major challenge has been to balance the demands of the business sector with those of ordinary citizens in desperate need of...

How I Dress and Customize Myself Essay Example | Topics and Well Written Essays - 750 words

How I Dress and Customize Myself - Essay Example My dressing manifests the decency, the body exposure, and the minimum dressing requirements that my religion and culture accepts. Indeed, my personal beliefs and values also define the tightness and type of clothes that I should put on. Actually, I put on clothes that will not expose or outline my body since that is against my personal beliefs and values. I dress to achieve and maintain my dignity and to respect mu cultural values. I also dress to support my personal belief of being joyful every day since that gives me energy for the day. I also dress to express my love for style. Personally, I do not envy body adornment like tattoos because I have a personal belief that they do not reflect decency, they are against my cultural values, and are equally painful. Nevertheless, I put on watches to support my personal belief of keeping time. I also have a personal belief of drawing attention and hence I dress to be stylish and attract attention. RESPONSE 2 I make these dressing and body a dornment to express my emotions. Moreover, my dressing decisions and choices seek to justify my beliefs and values. At the same time, I make these choices to abide by the lessons that my parents have taught me for years. Indeed, I seek to copy my parents’ dressing tastes as they reflect our cultural values. I also make these choices to avoid the recurrence of my own life experiences where my dressing embarrassed me. Additionally, in my dressing I present my class and respect for others. My choices also seek to dress appropriately for the occasion and venue where places like class, church, workplace, and sports ground require different clothing choices. Moreover, I make these choices for the sake of my health and manners where body adornments like tattoos maybe unhealthy and undignified. I also dress to achieve my professional requirement of decency. RESPONSE 3 Indeed, my dressing and body adornment have changed over the years. The surrounding, my parents, and peers influenced my dressing and body adornment choices. As I moved from one college to another, this changed my environment as well as my experiences on dressing. Indeed, I moved to a place where the dressing was more liberal than my hometown and I had to adapt to that norm. My experience of people who are no afraid to express their beliefs through dressing also motivated me to change my dressing for purposes of expressing my personal beliefs and values. As such, I have changed my dressing to reflect the local dressing ways. My peers have also changed my way of dressing as I sought to identify with them. Indeed, over the years I have had different peers with different dressing styles, which I have respectively adopted. I have also been copying my parents dressing which have changed overtime but remained decent. Moreover, as l grow and mature I gained the capacity to make my own dressing decisions, which manifest in the changes in my dressing. Ultimately, when I got a corporate job, I had to change my dressing choices thus reflecting how my dressing has changed over the years. RESPONSE 4 The core beliefs and values in my family were dignity, professionalism, decency, and emphasis on respectable and appropriate dressing. Ideally, dressing and body customization communicated these beliefs and values. My parents wore nice and decent clothes to work which reflected their professionalism and respect for others. They put on shirts, trousers, and skirts that reflected their decency and dignity. Moreover, even during holidays and outings, my parents always dressed appropriately and I had to adopt their dressing behavior as it maintained our core beliefs and values. Additionally, my parents never had tattoos because they believed that tattoos did not reflect

2nd amendment - the right to bare arms- US Constitution Research Paper

2nd amendment - the right to bare arms- US Constitution - Research Paper Example The 10 amendments were ratified only four years after the signing of the US Constitution. In contrast, slavery took some time or some 78 years from the signing of the Constitution or on 6 December 1865 to be abolished through Amendment 13. As of 1992, there have been 27 amendments to the original US Constitution. The Bill of Rights Institute explained that the American bill of rights has its origins in the British Charters of Liberty (4). Further, in England in 1688, the Glorious Revolution that placed Prince William of Orange and his wife Mary on the throne, required that as condition for the couple’s rule, the couple would have to accept the Declaration of Rights and the Toleration Act of 1869 (Bill of Rights Institute 4). According to the Bill of Rights Institute, the Toleration Act gave Englishmen the right to religion while the Declaration of Rights gave Englishmen the right to keep arms, among other rights (4). The American founding fathers were influenced by the notions of rights enshrined in the Declarations of Rights and the Toleration Act such that when the British ignored the common laws, they asserted that the said laws be followed or that â€Å"their mindset as Englishmen allowed them to assert their rights as Americans† (Bill of Rights Institute 4). According to t he Bill of Rights Institute, even long before the American Revolution, the American colonialists who fled the religious turmoil in England had a notion that their rights as Englishmen were part of colonial law (7). After the Revolution of 1776, first American states united under the Articles of Confederation (Bill of Rights Institute 7). However, the founding fathers considered that the Articles of confederation were insufficient for governance (Bill of Rights 7). Thus, the American Constitution was born. Opponents, however, had opposed a strong government represented by the American Constitution but settled for a compromise arrangement wherein delegates

US Stock Market and GDP Analysis

US Stock Market and GDP Analysis Stock Prices Definition Stock (or share) which is sometimes known as equity is a claim to partial ownership or holdings of a firm. Initially, the original owners of a firm sell their shares or stock to gain additional funds to finance the firm expansion which can be said as the owners sell part of the ownership of the firm to the stockholders. This is known as the Initial Public Offering (IPO). After the IPO, the stocks can be sold and resold by the stockholders in the stock market with the aim of gaining profitable returns through the price differences of the stock. Stock prices are determined through trading on a stock exchange such as NASDAQ, SP 500 and DJIA. Generally, stock prices reflect investor expectations for future corporate earnings and thus reflect for future economic growth. The Origin of the Stock Market The stock market originated in Europe prior the industrial revolution in the 1700s. Many traders in the market wished to make investment in huge businesses but this could not be affordable with a single trader. Thus, they gathered their funds together to invest in a new business as partners (Grazian, 2008). This is similar to the practice of shares nowadays and has inspired the origin of the stock market. In the beginning, the stock market trading started on an informal note. The traders met at coffeehouse which was used as a market place in the 1700s. The first exchange was created in Philadelphia during 1800 and in New York during 1817 and finally the trading rules were formed (Grazian, 2008). In the United States, the first stock exchange took place in Philadelphia over 220 years ago which was known as the â€Å"Board of Brokers† and the Board met at the coffeehouse. The Board of Brokers was later changed into the Philadelphia Stock Exchange in 1875 and it is now included in NASDAQ as NASDAQ OMX PHLX. The market became more structured without manipulative auctions and a fair commission structure was formed. The group of stock brokers was reorganized and known as the â€Å"New York Stock and Exchange Board† in 1817 (Terrell, 2006). In 1896, the Dow Jones Industrial Average (or the Dow) created by Charles Dow and one of his business associate, Edward Jones was first calculated. Along with other stock market index, such as NASDAQ and SP 500, the Dow is one of the most closely indicator to track the stock market activity. Besides the Dow, SP Dow Jones Indices also determined the SP 500 in 1957 (Standard and Poor’s, 2009). The SP 500 is more preferable than other stock market indices as it is determined through a more diverse constituency and weighting methodology with 500 stocks chosen for market size, liquidity and industry grouping. It is recognized as the best representation of the U.S. stock market and also classified as a leading indicator for the U.S. economy. Thus, the stock indices from the SP 500 were used as the data in this study. c. Stock Prices As an Economic Indicator Economic indicators give us a better idea of where the economy is headed. There are two types of economic indicators, which are the leading indicators and the lagging indicators. Leading indicators often change before the economic adjustment and thus can be used to predict the future economy whereas the lagging indicators reflect the economy’s past performance and only identifiable after the economic adjustment. Stock market is a leading indicator. Most people will first look at the stock market performance first when talk about the economic trends although it is not the most important indicator. This is because stock prices mainly depends on the expected earnings of the domestic firms, thus it can indicate the economy trend if the estimated earnings are accurate. A strong market usually followed with economy expansion while a down market always leads to economic downturn. However, it is undeniable that here are inherent flaws for stock prices to act as a leading indicator for the future economy performance. Firstly, the estimated earnings can be inaccurate. Secondly, the vulnerability of stock market which is probably adjusted or manipulated. For example, the government can manipulate the market to keep it high via various strategies to avoid public from panicking of economic crisis and the traders and corporations can manipulate the market via high-volume trades or other strategies. Thus, the true underlying strength or value of stock prices may become unobvious due to its vulnerability to be manipulated. Thirdly, the stock market is also susceptible to the creation of bubbles (Binswanger, 2004), which may convey false information about the economy’s direction. Economic Activity Definition The goal of economic activity is to produce goods and services in order to fulfill the needs and wants as well as to improve the social welfare. Economic activities are related to production, distribution, exchange and consumption of goods and services at all level in the society. Furthermore, economic activities can be defined as human activities which are performed in exchange for money or money’s worth, in other words, economics activities are those efforts performed by human to earn income, money, wealth and to maximize their satisfaction of wants with scarce means. The primary aim of the economic activity is to produce goods and services with an objective to make them available to the consumers. Thus, gross domestic product (or GDP) is one of the common ways to assess the economic activity. In this study, the economic activity is also represented by the indicator of GDP. The Origin and History of GDP The idea of gross domestic product (GDP) arose during the period post-carnage of the Great Depression and World War II in 1930s. GDP which was described as the ultimate measure of a country’s overall welfare, a window into an economy’s soul and the statistic to end all statistics was used widely and globally and become the defining economic indicator in the last century (Dickinson, 2011). Simon Kuznets, an economist at the National Bureau of Economic Research introduced a formula to determine GDP to the U.S. Congress in 1937.The original formulation of GDP was essential as it included all economic production in a nation. However, Kuznets’ formula was not being widespread utilized until the Bretton Woods conference created World Bank in 1944. After that, GDP was used widely as a tool to determine the nation’s economic condition. Although there are few economists questioned on the accuracy of GDP in measuring overall economic welfare, the GDP is still widely used now (Bureau of Economic Analysis, 2008). GDP is also described as one of the great invention in the 20th century because without this invention, economists, researcher and policymakers could not have played their role effectively with the unorganized data. GDP As an Economic Indicator Unlike the stock prices which serve as leading indicator, GDP serves as lagging indicator which changes after the economy adjustment. Although lagging indicators do not show the direction of economic trend, they reflect how the changes in economy over time. GDP is a tool that typically recognized by economists to measure the economic welfare. Increase in GDP indicates that the economy is strong while decrease in GDP indicates that the economy is weak. As stated previously, GDP is not a flawless indicator, many economists questioned on its accuracy especially in the financial market as some strategies such as quantitative easing and excessive government spending could have been carried out by the government to boost up the GDP of a nation. Despite of the flaw, as a lagging indicator, GDP is still a good determinant to measure the economic condition of a nation. Theories on Predictive Power of the Stock Price for the Future Economic Activity There are two theories in the theoretical literature on the forecasting ability of the stock prices for the future economic activities. The first theory explains the forward looking behavior of the stock market while the second theory discusses the causal effects of the stock prices on the economic activity (Croux Reusens, 2013). Forward Looking Behavior of the Stock Market Based on the idea that the stock price is the present value of future dividends (Fama, 1990), the theory of forward looking behavior of the stock market arose. The purpose for the stockholders to own stock is to earn from the interest difference when the stock is resold or to earn the dividends from the corporation. The increasing stock prices reflect the higher expectation of stockholders to earn more dividends. As the dividend is a payment made by a corporation to its stockholders out of its profit, the increase in expectation of stockholders towards future dividends gained indicates that there will be a rise in the corporation’s profit. Furthermore, the corporation’s profit is known to be positively correlated with the GDP of a nation, thus the rise in corporation will bring increment to the nation’s GDP. Therefore, a rise in the current expectation towards the nation’s future economic activity will definitely result in increase in the stock price. However, several researchers have argued that the vulnerable property of stock market to be manipulated may affect its predictive power towards the future economic activity. Stock prices may deviate from their fundamental value due to the speculative bubbles (Binswanger, 2004). Speculative bubbles is a situation in which the securities’ pieces such as stock prices rise far above their actual value as a result of irrational exuberance rather than the basic underlying fundamentals of the market. This can attract investors or stock traders to invest in order to take advantage of the profits. After some time, the bubbles will eventually burst and causes the stock prices will drop below their market value before they reach the equilibrium again. Thus, from this phenomenon, stock prices may deviate from the fundamental value sometime and hence its predictive power will be reduced. Apart from that, the globalization of the investment market also may reduce the predictive power of sto ck prices towards the nation’s GDP (Mao Wu, 2007). This means that is foreign investment in the domestic activity which brings about increase in stock price, however, since it is the foreign investment, it may not bring direct impact on the nation’s GDP. Causal Effects of the Stock Prices on the Economic Activity The causal effects of stock prices on the economic activity can be seen through the activity of consumption and investment. The connection between the stock prices and consumption can be explained by the wealth effect (Modigliani, 1971). The wealth effect refers to the increase in spending which due to the increase in perceived wealth. The rise in stock prices will bring about an increase in the income and wealth of the stockholders, they may increase their consumption as a result from having higher purchasing power. Since consumption is positively correlated with the GDP, the increase in consumption as a result from the rise in stock prices will affect the nation’s GDP. However, Pearce (1983) argued that the wealth effect depends on the distribution of stock holders in the nation. For example, most of the stockholders in the United States are comprised of small groups of rich people who have lower propensity to spend out of wealth. Besides, the causal effect of stock prices on the economic activity can also be seen through the activity of investment which its impact is on the cost of capital. The cost of capital is the fund for a firm to finance its business. The sources for capital can be varied from company to company such as equity financing and debt financing. Generally, the cost of capital is the weighted sum of the cost of equity and the cost of debt. With the increase in the stock price, the effective cost of equity will be reduced as a result from overvaluation of the stock price (Fischer Merton, 1984). Besides, cost of debt also will be lowered due to high stock prices as it could give some positive signals towards the lenders and thus raise the creditworthiness of the firms which would result in better loan condition (Morck et al., 1990). The Economy of the United States There is lots of news recently about the rapid growth rate of China absolutely furious pace for over the last decade and may overtake the United States to be the largest economy in the world. Nevertheless, the United States still keep the place of the largest economy in the world by far in the year of 2013. The United States has been keeping the place of the world’s largest economy for at least a century. With one third of the world’s millionaires and 40% of the world’s billionaires stay in the nation, the United States become the wealthiest nation in the world. The diversify economy and open market in the United States helps the economy to stay strong. The United States is also considered the largest manufacturer and the most influential financial markets in the world. Stock Prices in the United States The United States is considered to have the most influential and largest financial markets in the world. Almost every large company in the US is traded on a Stock Exchange. This study employed SP 500 as the stock market indices to be analyzed as it is the best representation of the U.S. stock market with 500 stocks chosen for market size, liquidity and industry grouping through a more diverse constituency and weighting. Figure 1.1 Time plot for quarterly average of daily SP 500 stock price index in the United States (Source: Economic Research, 2013) Figure 1.1 shows the moving trend of stock prices in the period from first quarter of 1974 to third quarter of 2013. From the figure, the stock prices in the United States generally showed a fluctuating rising trend with a record of expansion from 1974 to 2000 with gradual increasing rate at the beginning and higher pace increasing rate later from 1993 to 2000. There were significant market downturns in 2002 and 2008. The stock prices reached the peak in the second quarter of 2000 and started to drop afterwards until the minimum point in the first quarter of 2003. This market downturn has been known as the market crash of 2000. The causes for this crash are believed to be the corporation corruption, overvalued stocks and the emergence of day-traders or momentum investors. Several strategies has been listed out by the government to overcome the crash, for example accounting reforms to have better disclosure of corporate balance sheet form and new rules are set for the day-traders to apply more restriction. Besides the market downturn of 2000, there was a market downturn in 2008 as well. From the figure, the stock price index continued to rise after the market crash in 2000 and reached at maximum point in the second quarter of 2007 but falls gradually afterward till the minimum point in the first quarter of 2009. This period was ranked among the most horrified financial market history in the United States. This market crash is believed to be caused by the corporate corruption and the mortgage crisis. The stock price indices continue to climb after the market crash of 2008. GDP of the United States The United States has been the largest economy in the world in term of GDP level for at least a century. Figure 1.2 Time plot for quarterly GDP in the United States (Source: OECD. StatExtracts, 2013) The figure 1.2 shows the time plot of GDP of the United States from first quarter of 1974 to third quarter of 2013. Generally, the GDP level in the United States showed a gradual increasing trend across the period. From the figure, there are slight decreases in the GDP level are shown in 1982 and 1991 as a result of economic crisis. In addition, a more significant fall of GDP level was shown in the third quarter of 2008 after a gradual increasing trend. The National Bureau of Economic Research (NBER) declared that there was an economic recession since 2007. This economic fall is believed to be the result of mortgage crisis during that period. Relationship between Stock Prices and GDP of the United States The United States is famous to be the largest economy and the most influential financial market in the world. The tradition connection of stock prices and GDP of the United States has always be the topic of interest to be study among the researchers. Figure 1.3 Time plot for quarterly GDP and quarterly average of daily Stock Price in the United States (Source: Economic Research, 2013 and OECD. StatExtracts, 2013) Figure 1.3 shows the relationship between stock prices and GDP in the time plot from first quarter of 1974 to third quarter of 2013. In the tradition connection of the stock price and GDP, stock price is believed to contain the predictive power towards the GDP. From Figure 1.3, the stock prices generally moving in the same direction with GDP. However, the market crash in 2000 brought about economic expansion instead of the economic recession. This phenomenon goes against with the tradition relationship between stock price and GDP. However, the market crash of 2008 has successfully predicted the economic recession in 2008. Therefore, the contradict phenomena have again caught the attention of several parties to further study in the predictive power of stock price towards the GDP. Objective Although the theories and the tradition relationship state that the stock prices contain the predictive power towards the future economic activity, there are several theoretical and empirical researchers have contradicted opinions. Moreover, the historical data of stock prices and GDP of the United States also show a general similar moving direction of the stock prices and GDP but the market crashes in 1987 and 2000 resulted in economic expansion instead of economic recession. This issue has again prompted the further research in the tradition relationship of the stock prices and the economic activity. Hence, the purpose of this study is to determine the predictive power of stock price on the future economic activity, i.e. future GDP in the United States. Scope of Study This study focuses on the United States which the quarterly data is obtained with the sampling period from first quarter of 1974 to third quarter of 2013. The national stock price index of the United States, SP 500 is chosen. The quarterly average of the daily index is calculated because it is believed to be more representative for the entire quarter than the value at the end of quarter. Besides, quarterly nominal GDP is chosen as the representative for the economic activity. Both data is expressed in the domestic currency with CPI base year of 1982.