We think markets, finance, and economics offer fine fodder for quiz trivia. Test your knowledge with these questions about recent and pending market events:
- What is ‘Brexit?’ The United Kingdom will hold a referendum in June to decide whether it should remain in the European Union. According to the BBC, opinion polls say the public is pretty evenly divided on the issue. ‘Brexit’ stands for ‘British exit.’
- How likely is a stock market swoon during the next six months? A lot less likely than most investors think, according to a three-decade study conducted by the National Bureau of Economic Research and cited by Barron’s. The study asked participants how likely it was the market would lose significant value – as much as it did during the worst one-day drops in history (down 22.6 percent and down 12.8 percent) – during the next six months:
“On average over the last three decades, respondents believed there to be a 19 percent risk of such a daily plunge in the subsequent six months…Given that there have been more than 32,000 trading sessions since then, the judgment of at least this swath of history is that in any given six-month period there is a 0.79 percent chance of a daily crash that severe.”
- Which country is the biggest foreign buyer of U.S. residential real estate? Here’s a hint: It starts with the letter ‘C.’ If you guessed Canada, you are incorrect. Barron’s reported China surpassed Canada as the biggest buyer of U.S. residential real estate in 2015. U.S. commercial real estate is pretty popular with the Chinese, too.
Here’s another question analysts and economists have been pondering: Will the Federal Open Market Committee raise rates in June? The probability jumped from 4 percent two weeks ago to 30 percent last week, according to CNBC.
As you approach three score years and ten, don’t forget about required minimum distributions. Upon the occasion of his 70th birthday party, Mark Twain (a.k.a. Samuel Clemens) commented, “We have no permanent habits until we are forty. Then they begin to harden, presently they petrify…”
Whether Twain was right or not, the federal government demands most RSP owners develop a new habit at age 71. They must begin taking required minimum distributions, or RIFs, which are the minimum amount that must be withdrawn from most types of RSPs the year the owner reaches age 71, and every year thereafter. Account owners can take more than the minimum, if they choose. Regardless of how much is distributed, the amount usually will be treated as ordinary income for tax purposes.
Weekly Focus – Think About It
“Let us never forget that government is ourselves and not an alien power over us. The ultimate rulers of our democracy are not a President and senators and congressmen and government officials, but the voters of this country.”
–Franklin D. Roosevelt, U.S. President