This is a very serious topic because as far as I can conjecture according to the rough estimates out one hundred persons in this world, 33 per cent live under the poverty line. The other 33 per cent live from hand to mouth. In the third place, the remaining 33 percent population of the world can save for spending. And also can invest in non-developmental plans in addition to dreaming of investing in Developmental Projects. The last 1 per cent can save and and also can practically invest in projects.
SAVING AND INVESTMENT: DEFINITION OF SAVING
Saving And Investment is Most Essential For further progress For a Family, A Company or a Nation But 90% of World Population is unable to save and Invest.
Saving is defined in many ways:
1. Depositing Money in the Bank
2. Purchasing Stocks and subscribing to a Pension Plan.
3. Spending less in the present for Consuming in the Future.
To clarify Economist’s viewpoint, an example of Corn is given. Corns eaten once are consumed and destroyed for ever. But the Corn not consumed yet are saved. If you sow these saved corn in the soil, it will grow to 700 times and even more.It shows how beneficial is investment.
SAVING AND INVESTMENT: DEFINITION OF INVESTMENT
Saving And Investment is Most Essential For further progress For a Family, A Company or a Nation But 90% of World Population is unable to save and Invest.A Restricted Theme. Saving money is Essential for Investment in some Business or Project.
Economists define Investment by “Purchasing Durable Goods for houses and governments”. Private Investment is divided into following three broad categories:
1. Residential Investment, which accounts for about a quarter of all private investment.
2. Non-residential, or business , fixed investment, which constitutes most of the rest.
3. Inventory Investment:This is small but dynamic type of Investment.
SAVING AND INVESTMENT: FURTHER ELABORATION OF THE CONCEPT OF SAVING AND SPENDING
The Topic is viewed in the following two ways:
1. Macroeconomics activity as is termed by “Keynesian” – the National Accounts View.
2. The Monetarist View as is Applied on money and banking.
SAVING AND INVESTMENT
Saving Depends on the following Factors:
1. Higher Rate of Interest.
2. Poor returns on risky form of saving.
3. Poor expectations from future
4. More disposable income after fixed expenditures
5. Perceived Likelihood of plunder of the future value of savings,
Investment Depends on the following Factors:
1. Investment is made into capital i.e.plants, humans and education etc.
2. In National Accounting Terms, stocks, bonds, mutual funds etc.
3. In monetary terms, the relationship between savings and investment is modeled, rather than being an accounting identity.
GOOD PURCHASES ARE ALSO A KIND OF INVESTMENT
Purchase of books on Self-Development for improving one’s personality is a most lucrative kind of Investment.Buying electronic gadgets e.g.Mobile Phone, have been made into a compulsion or habit, for making life comfortable in the modern days. Purchase of Machinery for a Capital Intensive Undertaking is also a very useful Investment. Here are three links for purchasing Books, Consumer Electronics and Machinery.