Financial Education

Lexicon v1

Comprehensive financial glossary with 154+ terms

of 154 terms

Bear Market

Macro

Broad market decline of ~20%+ from recent highs

A bear market is characterized by a broad market decline of 20% or more from recent highs, typically lasting several months or longer. Bear markets ar... ...read more

market cycle decline pessimism recession

CPI (Consumer Price Index)

Macro

Inflation gauge of consumer basket prices

CPI measures changes in the price level of a basket of consumer goods and services. It's the primary inflation gauge used by central banks and governm... ...read more

inflation price index consumer spending monetary policy

Fed Funds Rate

Macro

Overnight interbank lending rate targeted by the Federal Reserve

The federal funds rate is the interest rate at which banks lend reserves to each other overnight. The Federal Reserve targets this rate to influence e... ...read more

monetary policy interest rates federal reserve overnight rate

Fiscal Policy

Macro

Government spending/taxation policy

Fiscal policy involves government decisions on spending and taxation to influence economic activity. Expansionary policy (deficits, tax cuts) stimulat... ...read more

government policy economic stimulus deficit spending taxation

Inflation

Macro

General rise in prices; erodes purchasing power

Inflation is the rate at which the general price level of goods and services rises, reducing purchasing power. Measured by CPI, PPI, and GDP deflator.... ...read more

price level purchasing power monetary policy economic indicator

Real Interest Rate

Macro

Nominal rate − expected inflation

Real interest rate adjusts nominal rates for inflation. Formula: Real Rate = Nominal Rate - Expected Inflation. It represents the true cost of borrowi... ...read more

inflation adjustment purchasing power monetary policy economic indicator

Recession

Macro

Broad economic contraction; often defined by NBER in the US

Recession involves significant economic contraction with declining GDP, employment, and industrial production. In the US, NBER defines recessions as s... ...read more

economic cycle gdp contraction unemployment economic slowdown

Soft Landing

Macro

Gradual economic slowdown without recession

Soft landing achieves economic cooling through measured policy tightening, avoiding recession. Central banks aim for this when combating inflation wit... ...read more

monetary policy economic cooling inflation control growth management

Sovereign Yield Curve

Macro

Yields by maturity; slope reflects growth/inflation expectations

Yield curve plots government bond yields across maturities. Normal curve slopes up (longer bonds pay more). Inverted curve signals recession expectati... ...read more

interest rates economic expectations recession indicator monetary policy

Wall of Worry

Macro

Market's tendency to rise despite persistent concerns

Wall of worry describes markets rising despite numerous negative factors. Investors become desensitized to bad news, allowing prices to climb until se... ...read more

market psychology contrarian investing sentiment resilience

Yield Curve

Macro

Plot of yields across maturities; normal, flat, inverted

Yield curve graphs interest rates across different maturities. Normal curve slopes upward, inverted curve (short rates > long rates) often signals rec... ...read more

interest rates maturity spectrum economic expectations recession indicator