Saturday Rave: The Dow Jones, and other numbers.

On 8 July 1032 the Dow Jones Industrial Index sank to 41.22, its lowest level of the Great Depression.

The Dow Jones was named after a couple of businessmen called Dow and...but you're ahead of me. The idea is that the Dow Jones looks at thirty very big US companies that give the public an opportunity to buy a share of the profits. If the company is making lots of money then naturally the price of a share of the profits will go up, and if it's doing badly then it will fall.

All these results are collected daily, massaged a bit, and then we end up with a sort of overall average for how well the US economy is doing.

Unfortunately it doesn't work quite as well as it sounds. For one thing people are always ignorant and often idiots: sometimes they'll pay silly prices for shares because no one has told them a company is failing, and sometimes people get frightened and sell their shares at silly prices for no real reason at all.

Sometimes people with money just decide that buying a share in a company will be better than keeping the money in, well, money, and that can affect things, too.

Still, there are similar systems in place all over the place. In Britain we have the ridiculously named FTSE (that's pronounced footsie) 100; France has the unfortunate-sounding CAC; Oman the MSM-30; Poland the WIG; Spanish the jumpy-sounding IBEX-35; and Romania the surely far-too-frank BET-10. On the other hand Argentina has the encouraging MARVEL, and Bulgaria the SOFIX. 

The USA has about eighty different indexes all together, but what of the original Dow Jones? 

At the time of writing it stands at 21,493.86.

Even an ibex would have trouble jumping that high.

Word To Use Today: index. This word is the Latin for pointer.