The difference between the market price of electricity and its cost of production. This measure is important because it helps utility companies determine their bottom line (profit). If the spark spread is small on a particular day, electricity production might be delayed until a more profitable spread arises.
A period of economic slowdown amid a larger trend of economic growth. This buzzword is most often used in the financial media and by the U.S. Federal Reserve to describe a period of economic weakness. This term gained popularity when former Federal Reserve Board Chairman Alan Greenspan used it in his review of the overall U.S. economy. Central banks often cut interest rates in an attempt to spur the economy through the soft patch. An example of a soft patch would be an economic slowdown due to rising commodity prices, which is believed to be short term, with the economy growing at a faster rate after the slow patch.
A reference to a lack of confidence in a report's facts or general disrespect for a report's author. A soft paper report should have only one use – as toilet paper – which is how its name was derived. Also known as a toilet paper report. Reports are almost always subjective, as even hard facts have to be interpreted. In business, it is important not to rely on everything you hear and read, and instead to do a little homework yourself. Otherwise you could find yourself relying on a report that is only good for toilet paper.
1. The "one-time" funding from governments and organizations for a project or special purpose. 2. Paper currency, as opposed to gold, silver, or some other coined metal. A good example of soft money is the campaign funding that politicians get during election years. The money received is not recurring and it is to be used explicitly for election related expenses.
A term used to describe a rate of economic growth high enough to avoid recession, but slow enough to avoid high inflation. When the economy is growing at strong rate, the Fed will try to engineer a soft landing by raising interest rates enough to slow the economy down without putting it into recession. Alan Greenspan, the former chairman of the Federal Reserve Board, was a master at the soft landing.
A means of paying brokerage firms for their services through commission revenue, as opposed to through normal direct payments (hard dollar fees). The investing public tends to have a negative perception of soft dollar arrangements because they believe that buy-side firms should pay expenses out of their profits, rather than from investors' pockets. As such, the use of hard dollar compensation is becoming more common. For example, a mutual fund may offer to pay for research from a brokerage firm by executing trades at the brokerage. Let's say that Large-Cap Value Fund (LCV) wants to buy some research from XYZ Brokerage Firm. LCV may agree to spend at least $10,000 in commissions for brokerage services in return for research from XYZ. This would represent a soft dollar payment. Alternatively, if LCV wanted to simply buy the research from XYZ and not agree to any kind of soft dollar fee, it might have to pay the brokerage firm $7,000 in "hard dollars" (cash) for the service.
A description of companies that have large capitalizations and provide investors with slow but steady and dependable growth prospects. The annual gain that would be viewed as the norm for investing in stalwarts is about 10% to 12%. Stalwarts will by no means become tenbaggers overnight, mainly because of their large capitalization, but they are usually a good source of fairly predictable returns. Peter Lynch popularized this term in his book "One Up on Wall Street," where he shows that the price chart of a stalwart compares neither to a topographic map of Delaware nor to one of Mount Everest, but assumes a place somewhere in the middle.
1. In financial terms, a period of time when borrowing is difficult. 2. In general business terms, times when increasing costs cannot be passed onto consumers. The decrease in profits is said to be caused by a "squeeze" on profit margins. Be careful not to confuse this with the short squeeze, which is an upward movement in price of a stock caused by investors covering their short positions.