What Is a Growing-Equity Mortgage (GEM)? A growing-equity mortgage (GEM) is a type of fixed-rate mortgage where monthly payments increase over time according to a set schedule, rather than remaining fixed and equal over the loan term. The interest rate on the loan does not change, and there is never any negative amortization. Instead, the
What is a Growth Recession? Growth recession is an expression coined by economist Solomon Fabricant, a professor at New York University, to describe an economy that is growing at such a slow pace that more jobs are being lost than are being added. A growth recession does not reach the severity of a true recession
What Is Growth Accounting? Growth accounting is a quantitative tool used to break down how specific factors contribute to economic growth. Growth accounting focuses on three primary factors: the labor market, capital, and technology. Key Takeaways Growth accounting is a quantitative tool used to break down how specific factors contribute to total GDP growth.The growth accounting
What Is a Growth Company? A growth company is any company whose business generates significant positive cash flows or earnings, which increase at significantly faster rates than the overall economy. A growth company tends to have very profitable reinvestment opportunities for its own retained earnings. Thus, it typically pays little to no dividends to stockholders, opting
What Is a Growth Curve? A growth curve is a graphical representation that shows the course of a phenomenon over time. An example of a growth curve might be a chart showing a country’s population increase over time. Growth curves are widely used in statistics to determine patterns of growth over time of a quantity—be
What Is a Growth Firm? In finance, the term “growth firm” refers to a company that has a track record of unusually rapid growth as compared to its industry competitors. Although this term is widely used in financial media, commentators will often differ in their exact usage of the term. Growth firms are often among
What Is a Growth Fund? A growth fund is a diversified portfolio of stocks that has capital appreciation as its primary goal, with little or no dividend payouts. The portfolio mainly consists of companies with above-average growth that reinvest their earnings into expansion, acquisitions, or research and development (R&D). Most growth funds offer higher potential capital
What Is Gresham’s Law? Gresham’s law is a principle that states that “bad money drives out good” and can be applied to the currency markets. The law stemmed from the historical use of precious metals to manufacture coins and their subsequent value. Since the abandonment of metallic currency standards, the theory often describes the stability
What Is a Grey Swan? Grey swan is a term used to describe a potentially very significant event whose possible occurrence may be predicted beforehand but whose probability is considered small. In other words, it is a risk with a potentially large impact but a low perceived likelihood of happening. Because there is a slight chance the
What Is a Grey Wave? A grey wave describes an investment or company thought to be profitable in the long term or extended long term. Speculators of grey waves will buy an investment vehicle that they believe will show a return in the very long term, and not before. The term “grey wave” can be
