Preparation Sheets Essay

1.Notwithstanding challenging business conditions in China, do you think Australian business needs to exit Europe and America and focus on Asia? Justify your answer. As seen in the previous few years the Asian market has boom in the world economy. China emerges centre stage and it’s the economy is closely intertwined with the world at large. It is the world’s largest consumer marketplace. The averaged over 10% economic growth while the global financial crisis is going by preceding years; China gains the superpower economy status in the world. While the subsequent economic downfall and problems in the European and the American zone; The Asian and Pacific Rim economies are still continue to grow and soon expected to be larger than those of the European Union. The growing prominence of the firms like Honda, Toyota and Sony of Japan and the Samsung and Hyundai of South Korea are few of the companies which boost the Asian market in the world. Hence in spite of challenging market conditions in china, I think Australians business needs to enter the Chinese market rather than focusing on EU and America. 2.How would you set about building relationships with Chinese counterparts in order to establish a business operation there? The two keys to success are the relationship building, networking and dealing with the ethical, trustworthy people. By setting up business operations in many well placed regions so as to take advantage of inter-regional trade across the countries and with Australia. The other aspect is by joint venture or co- ownership in the business helps to understand the business culture, market strategies, and the mentality of the local investors and the consumer needs. 3.Would it be better to invest in other Asian countries like India (with just as big a population)? It’s anytime better to invest in the nations with larger consumer market (like India). In past few years Indian market is growing fast and making its place in the world’s economy. India imports on a large scale and the Indian market is wide open for the foreign companies; in last few years with numbers of foreign brands coming in like In cars Mercedes to Ferrari, in IT IBM to Microsoft, in electronic Samsung to Apple and with the food chains like KFC to McDonalds. It is the biggest market for the foreign investors currently. So it’s the perfect time for the foreign investors to enter the Indian market. As unlike china, the India global business language is English which makes lot of difference to foreign investors to strategies and communicate straightforwardly with the local investors whereas the business policies are also familiar with the foreign markets. 4.What are the best investment strategies for Australian companies in China given the above case? According to the case study, the best investment strategies included are setting up the business in well placed regions so as to take advantage of inter-regional trade across the country. Developing projects in the remote areas; and setting up business in joint venture or with co- ownership is always successful to establish itself in the new territory.

Discussion-Reflections and Responses

What does Lynda Parry's comic strip suggest about children and drawing? What do they enjoy about it? Why might they suddenly stop drawing? What does Barry seem to be saying about the creative process In general? I believe that children love the Idea of drawing whatever Is on their mind. If something pops up, they could express themselves by drawing whatever It Is.Barry Is trying to say that children should draw no matter what happens. There may be times where they second guess homeless and that will have an effect on the final outcome. Children may suddenly stop drawing because they are being criticized by other students or even their teacher. Being criticized may bring them down and can have a negative feeling on them. By doing so, they will feel that art is not for them and not want to draw anymore. 2. What are the â€Å"two questions,† and how are they visualized throughout the comic strip?What does their appearance suggest about them? What is their connection to â€Å"goo d† drawings and â€Å"bad† drawings? What do you think the octopus-like creature is meant to suggest? What is the significance of the repeated phrase â€Å"don't know†? Two Questions is a comic strip about Lynda Barry and the art of cartons and drawing. This writer/artist had times of troubles that made her a better person. â€Å"Is it good,† â€Å"Does it suck,† were the two questions that were asked every time she had drawn something.Barry wanted to be a good artist, but she had her doubts about herself. She had to try and figure out the answers to her questions, but instead she shows objects and creatures that are trying to pull her down. For example, on page 66 there Is a picture of a creature that says â€Å"Man the torpedoes she's getting closer. † There are four different torpedoes that explain four different names: moron, genius, stupid, and brilliant. This signifies that she Is getting closer to the answer of these two questions. 3.C onsider â€Å"Two Questions† not as an Illustrated personal essay but as an amalgam of verbal and visual craft Intended as a unified creative process. Explain how Barry achieves this Integration of word, Image, and concept. How does she go about making drawing Inseparable from Its language? Barry achieves the Integration f everything by putting them all as one. Through word and Images a story comes about. She Illustrates what she Is felling and everything that Is on her mind. She sticks with one concept throughout the whole essay, which is drawing.The two word, image, and concept Barry came out with an meaningful essay that teaches a lesson. Peer Review What I learned from this paper is that kids like to think a lot and are also very creative when it comes drawing. I like how the author says that when she was younger she would Just make a few lines and the next thing you know she was drawing and she also says that every kid understands the concept behind that, it is something that doesn't not have to be taught to them they Just know how to draw.Kids will draw Just about anything monsters and even funny looking people. Brandon does a great Job of formulating his thoughts and answering the questions that were asked for this assignment. He referred to the text explicitly to give the reader an idea of what the â€Å"Two Questions† was about. He also mentioned the author's name at appropriate times and gave his own interpretation of the text and does a great Job of answering the questions required for this assignment.

Explore Shakespeare’s presentation of love in “As You Like It” Essay

Love has always been a foremost feature of the plays written by William Shakespeare and â€Å"As You Like It† is no exception with love regularly being represented throughout the play in a variety of ways. Just like in Shakespeares other works â€Å"As You Like It† is also broken down in to a main plot, which is then accompanied by smaller sub-plots that are scattered thorughout the play. Shakerspeare along with the play â€Å"As You Like It† skillfully uses these plots well to demonstrate various types of love. One variety of love that Shakespeare anylyses deeply is that of courtly love, whose ideas featured heavily around the fact that love brings suffering and agony to the lover and the theory that the male lover is controlled by his mistress to whom he must adhere to. Courtly Love had become a popular subject to write about during Shakespeare’s Elizabethan period and was also strongly evident in english literature for centuries previously. The concept of pastoral romance is also expressed in â€Å"As You Like It† , in which characters in rural countryside areas appear to act freely and joyfully , and this causes relationships to revel successfully and contently. In other words Pastoral romance seems to betray the countryside in stories as some sort of catalyst speeding up the progress and success of overall relationships. On the other hand life in the court seems to lack this optimism and instead living in developed areas (towns, villages, cities etc) seems to damage love between characters due to the stress and demand of court life. This type of romance is also strongly associated with disguise and the thought of characters falling in love with the opposite sex even when in disguise. The love in Shakespeare’s plays was recognised by the public of the Elizabethan period who had a good understanding about how genuine and pure love was between characters along with a good perception of the characters personalities (such as social status) just through the language they spoke during the play. The relationships in â€Å"As You Like It† are tested in one way or another, as most have to overcome obstacles and problems in order to succeed The particular relationships we see in the play symbolize and highlight the variant types of love that William Shakespeare wishes to explore. For example the familial love between the brothers of Orlando and Oliver, Duke Frederick and Duke Senior are emphasized due to the fact that both relationships are struggling and are under much tension when in normal circumstances you would presume this type of Familial relationship to prosper solidily, but alternatively have crumbled consistently. The relationship amid Orlando and his eldest borther, Oliver has reached an even more dire state, due to the recent event of their father Sir Rowland de Boys tragically dying for reasons unknown to us. Since this death of Sir Rowland de Boys Oliver and Orlando have been at conflict over the acts of Oliver who is restricting Orlando from receiving a gentleman’s education even though their father had wished him to have one. Both characters deal with this issue by becoming heated and ill-tempered towards each other. This is shown in Act 1 Scene 1 where Oliver says: â€Å"Wilt thou lay hands on me, villain?† Oliver and Orlando’s relationship changes significantly during the course of the play and it is seen that the countryside and its links to pastoral romance are responsible for the reformation of their relationship. This is true because the turning point of their complex relationship takes place in the countryside to where Orlando’s act of decency, (when he saves Oliver’s life from a viscous Lioness) provokes Oliver to want to become a more amiable person. Also the romantic relationships of the brothers between Rosalind and Celia respectfully seems to show that the concept of pastoral romance is functioning between them and therefore causing them to be more loving people. Understandably this friendly environment causes their own familial relationship to blossom. This transformation in their relationship is represented well when Oliver is delivering Orlando’s bloody handkerchief to Ganymede in Act 4 Scene 2. In this scene he confesses about his shameful past by saying: â€Å"‘Twas I, but ’tis not I. I do not shame To tell you what I was, since my conversion So sweetly tastes, being the thing I am.† This indicates that he is aware that he was in the wrong before, but now values and loves his younger brother, even more so that he obeyed Orlando’s order to deliver his handkerchief. Another familial relationship present in the play is that of Duke Senior and his younger brother Duke Frederick. This particular relationship is struggling due to the fact that Duke Senior has been exiled from the court by his usurping brother Duke Frederick. This unjustified act by Duke Frederick has left the two distant and bitter towards each other. This is shown in Act 2 Scene 3 when Duke Frederick is in the process of exiling Rosalind, the daughter of the banished Duke Senior. Duke Frederick’s tells Rosalind the reason for her being exiled is because: â€Å"Thou art thy father’s daughter. There’s enough.† This shows that there is obviously some hatred between the two brothers, especially on Duke Frederick’s part. Duke Senior and Duke Frederick react to this conflict in contrasting ways. Duke Senior seems to make the most out of the situation he has found himself in to positive effect. He does this to an extent that he’s actually enjoying life away from the court. On the other hand Duke Frederick deals with their dispute by becoming heated and showing irrational behavior (This is shown when out of blue he aggressively orders Rosalind to leave the court and even goes as far as saying he will kill her if she was not to obey) in play. The hatred of Duke Frederick towards Duke Senior is incredibly similar to that of Oliver towards to Orlando, in that there seems to be no obvious reason for why they should detest their brothers so much. But just like Oliver and Orlando, Duke Frederick and Duke Senior’s relationships turns around positively in the latter stages of the play. This turn of events is due to the remarkable change of mind from Duke Frederick who persuaded by an old religious man on the outskirts of the forest to not invade the Forest of Ardenne decides to conclude his search for his brother. Instead, as we’re told by Jacques de Boys in Act 5 Scene 4 that he: â€Å"After some question with him, was converted Both from his enterprise and from the world, His crown bequeathing to his banished brother, And all their lands restored to them again That were with him exiled† This act of love shown by Duke Frederick towards Duke Senior and his company could also be due to the powers the countryside possesses through pastoral romance. This could be explained by the way that Duke Frederick has a dramatic change of heart when entering the forest and he also wants to be â€Å"freed† from court life by deciding to join a monastery. A prominent relationship on display in â€Å"As You Like† is between the inseparable cousins that are Rosalind and Celia. This relationship is under strain mainly just because of the complications surrounding their father’s relationship. They have been brought in to the thick of their father’s own personal conflict due to Duke Frederick’s antics, referring to him wanting to exile Rosalind and consequently separate Rosalind and Celia. Rosalind and Celia respond to the antics of their fathers positively, by promising to each other that they’ll stand by each other religiously through the hard times that are facing them, causing them both to flee from the court together. This united type behavior form the cousins shows the audience that this love is extremely solid and their love for each other is cannot be doubted. This is shown when Celia responds to her fathers actions by saying to Rosalind in Act 1 Scene 3: â€Å"Prithee, be cheerful. Know’st thou not the duke Hath banished me, his daughter?† Furthermore Rosalind and Celia decide to overcome their complications by fleeing to the Forest of Ardenne to find refuge. This seems to work dividends, as when they are in the forest the pair seems more relaxed and joyful than they were when they were generating tentative feelings back at the court. This is shown through the way they act more freely and seem more comfortable expressing their views on topics than they were in the court. They also becoming more suspect to falling in love, and this shows in the way they fall in love with Orlando and Oliver. All this makes one presume that pastoral romance is in progress with this pair. A different type of alliance is show using Adam the servant and Orlando in the play â€Å"As You Like It†. Between these two characters is dutiful love shown from both sides. The obstacle that this exact relationships faces is down to the misbehavior shown from Orlando’s brother Oliver, who Adam says is plotting to kill Orlando. The pair then address this situation in the same way as Celia and Rosalind did, by escaping in to the forest. This is where Adam’s dutiful love is evident when he swears allegiance to Orlando in Act 2 Scene 3 by saying: â€Å"Here is the gold. All this I give you. Let me be your servant.† Theses words are very strong, as Adam shows he will give Orlando everything he has even his fortunes just so that Orlando is able to be content and safe. Further on in the play Orlando also shows loyalty pointing to Adam. This dutiful love is expressed in the way Orlando carries Adam in to shelter and vows to find his poorly servant food; he even makes a fool of himself in front of Duke Senior and his Lords purely in attempting to find his loyal servant some much-needed food. This dutiful love shown on Orlando’s part can be seen in the way he tells Adam in Act 2 Scene 6: â€Å"Come, I will bear thee to some shelter, and thou shalt not die for lack of a dinner if there live anything in this desert† Once again you can say that the concept of pastoral romance has left this pair living happily ever after as it looks to have solved all their problems, which they have now left at the court. A different relationship represented in â€Å"As You Like It† is that of Silvius and Phoebe. In this relationship the love is not shared from Phoebe in contrast to Silvius who seems to be suffering much grief and pain due to his immense and obsessive love for Phoebe. Both characters face their dispute concerning their conflicting views by becoming frustrated, Silvius because he cannot obtain Phoebe’s love and Phoebe because of Silvius constant pleas for her to welcome his fondness for her. The evidence to show that Phoebe does not show the same affection for Silvius can be seen when she comments on how much she’d rather not be in a romantic relationship with Silvius in Act 3 Scene 5 by saying to Celia (dressed as Ganymede): â€Å"Sweet youth, I pray you chide a year together. I had rather hear you chide than this man woo.† This idea that Silvius is suffering thanks to the elements of love is very similar to the objectives of courtly love. Obviously this situation proves problematic for it to be possible for Silvius’s and Pheobe’s relationship to advance, but a few twists occurring at the end of the play enable this couple to surprisingly tie the knot. The events which engineer Silvius and Phoebe to come together can be argued to be thanks to the pastoral romance theme, which is seen on a frequent basis in this play. This is true as pastoral romance is well known for its characters in disguise and it’s the disguise of Rosalind (Ganymede) that actually plays the vital role in bringing Silvius and Phoebe together. Thanks to Rosalind’s slyness Silvius finally is able to be with Phoebe and it seems that she shows some genuine affection towards Silvius. This is noticeable when she says in Act 5 Scene 4 to Silvius: â€Å"I will not eat my word. Now thou art mine, Thy faith my fancy to thee doth combine.† A relationship that does not develop until the tail end of the play â€Å"As You Like It† is between that of Oliver and Celia. Celia who is dressed up as Aliena looks to fall in love with Oliver at first sight and these provides an ironic end for the character Celia in the play. This is an accurate observation, because during the play Celia is seen teasing her dear friend Rosalind about the hastiness about her love for Orlando. This is another classic example of how pastoral romance is a striking feature of the play, because even though Celia has been ridiculing Rosalind love for Orlando it seems that even she is eventually bewitched by the powers of the countryside air and decides to marry a man whom she has just met. A unique relationship in the play is that of Pheobe and Ganymede. This is correct, as Phoebe is falling for Rosalind in disguise, without being informed. The relationship between these two characters is a clear example of the courtly love evident in â€Å"As You Like It†, because of the agony and frustration, which Pheobe endures due to her love Ganymede. Ganymede reacts to Phoebe;s attempts to win her heart by saying in Act 3 Scene 5: â€Å"I pray you, do not fall in love with me, For I am falser than vows made in wine.† This dismissal of Phoebe’s love on Ganymede’s part shows that Ganymede has no interest in Phoebe at all, but despite this in true courtly love fashion Phoebe’s decides to persist with her quest to win Ganymede’s heart. In the end their relationship disintergrates when Phoebe says in Act 5 Scene 4: â€Å"If sight and shape be true, Why then, my love adieu.† The most influential relationship in the whole of the play is beyond doubt that of between Rosalind and Orlando. This is true, as this relationship seems to dictate the course of the storyline. This relationship falls down heavily in to the elements of stereotypical pastoral romantic stories. This is correct, as Orlando seems to endure a lot of agony and pain over the course of the play†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..I will finish this later In conclusion I believe Shakespeare has shown us that men actually behave in the same way as women when in love. The evidence ot prove this is the behaviour of most characters in the play. Most of these characters endure large amounts of suffering

Investigate and analyse the financial system of South Korea, Its level Essay

Investigate and analyse the financial system of South Korea, Its level of development,The efficiency of its financial markets,an - Essay Example South Korea established a central bank in 1950 that was given the mandate of regulating all the other banks in the country, printing and circulation of the currency in South Korea as well as making laws and regulations that would govern other financial institutions in the country. The minor banks in South Korea had a function of extending credit services to businesses and other medium and long term investment projects (pg 48). Today, the financial system of South Korea has grown and continues to improve remarkably over the years. South Korea is located in the north-eastern Asia and it is bordered by the Yellow sea to the west and Democratic Republic of Korea to the north. South Korea has four distinct seasons and in 2011, the population was estimated to be 48.75 million people with the annual growth rate in population estimated to be 0.23%. South Korea is characterized by low birth rate and high life expectancy at an average of 82 years for women and 75 years for men but the literacy levels are high with compulsory schooling for the first 9 years. This has greatly been affecting the economy of South Korea because most of the population is made up of the old people. The major religions in South Korea are Christianity, Buddhhism, Shamanism, Confucianism and Chondogyo. Politically, South Korea has a well organized government by the president, the parliament and the judiciary. Power was well laid out in the constitution that was appealed in 1987 (Kim & Black, 2004). South Korea has had a well performing investment sector especially in agriculture and other medium and long-term investments. This sector has been an integral part of the economy of South Korea and the banks even offered loans that would be channeled towards these businesses. They contributed to the growth of South Korea’s GDP that has improved though it had staggered for some time due to hard economic times that South Korea went through for some time (Lau, 1996). The depository sector of the fin ancial system has also been improved over the years where unlike the times when banks were solely owned by the government, the people have been allowed the freedom to have shares in the banking sector and the banks have started offering depository services for their customers (Lee, 2004). This has strengthened the financial system of South Korea and has ensured that there is constant growth in the sector. In the recent years, South Korea’s financial system moved from the government ownership to more widespread powers where people were allowed to participate directly through the purchase of shares. This was contributed to by the increases reforms and strategies that were geared towards attainment of stability in the financial markets. Over the past 10 years, The GDP of South Korea has experience fluctuations in GDP with a 9% growth in 2009 and 6.1% being recorded in 2010. This was due to changes in economic situations globally and changes in the level of exports in the country over the years. South Korea’s financial system has improved significantly and it has even gone ahead to sign business agreements with North Korea that are aimed at improving the exports in the country hence ensuring the country a growth in the GDP and Foreign Direct Investment (FDI) (Zahid,1995). The growth of the financial institutions in South Korea have been so much affected by the aging population, strict labor laws, poor management of the institutions, underdevelopment of the

Education Essay Example | Topics and Well Written Essays - 1500 words

Education - Essay Example The uneducated individual often is unaware of the happenings and developments that are taking place in the society and in the world surrounding them. As a result they are more involved in the process of looking out for odd jobs, which they could perform to make their livelihood. For the educated individual the scenario is totally different, since a plethora of opportunities open before them to discover the world and apply what they have learned during the years of education. It is a medium that trains the mind of any individual, since it helps to expand and bring out the inner capabilities, which are very much hidden within the self. For this reason education has been considered to be very essential for any person, who wants to make a mark for themselves in the present world. Though many external factors affect the quality of education that is being imparted to each individual, today most of the nations are concentrating inputting up their concerted efforts to make sure that, their c itizens get proper quality education during the course of life. ... Taking the proper and right decisions is very vital for the survival of the human being in the present world. Education thus has got a very great significance as it forces the mind of the human being to think rationally, which very well distinguishes them from the rest of the illiterate crowd. Due to this much importance has been given by the modern day thinkers and the governments alike of the countries worldwide to impart quality education to their citizens, which will create plenty of job opportunities for them to take the right direction and progress in life. Thus the whole educated population present in the society will help the country to make rapid strides in the course of developing their respective economies, which will go a long way to bring prosperity to the entire nation and their fellowmen. (www.ditext.com ) The present day world is scientifically and technologically much advanced only because of the fact that, the majority of the current generation across the world is h ighly educated, which has revolutionized the modern society. It is only through the imparting of proper quality education that has trained the minds of the young generation, to critically think and take rational decisions which have been the cornerstone for all the success that has been achieved in the realms of science, arts and almost all other fields. This has been possible since in recent years, there has been a very wide spread of information as well as knowledge to almost all the corners of the earth, which has been enabled only by means of education. Though in most of the cases where the society and the country impart a form of general and basic education to its country men, it is seen that the vast majority of them do not pursue higher

Education Essay Example | Topics and Well Written Essays - 1500 words - 2

Education - Essay Example The hurdle ahead to making and cultivating of bright future leaders lie in the fact that there must be a solid, rational and foolproof system in place that ensures the supply of the best possible talent in a systematic manner for generations, just like the flow of fresh waters from glaciers, unconditional and superfluous. Young talent originates from the children of a nation. Indeed the birth of a â€Å"born brilliant† is the miracle of Mother Nature but the polishing of a gem till its transformation into a priceless jewel that the world can admire but cannot afford to buy is the duty of a jeweler. Similarly the states today need to nourish their children and develop them into accolades that honor the nation in the future with standout performances in the fields of military, science and technology. Perhaps this one of the most significant reasons that why developed countries spend large chunks of their budgets on the development programs for children; and why do they allocate high percentages of their budgets to educational and other development programs that are aimed at providing the best of the facilities and infrastructure to their children. Some Exemplary Moves It took United Nations (UN) not long to correctly identify the benefits and meaningfulness of children to the progress and success of the world in the long run. UN was proactive in addressing to the arrangements that were required to be made in order to provide a platform to children and adolescents to coin their opinions and voice their concerns on higher levels. Several resolutions have been passed in the UN as part of the process that ensures that member states provide bright and lucrative opportunities to the young members of their populations to be a part of the decision making process and of the work force (Harry Sheir, 2001). Inviting young individuals to higher platforms and including and considering their opinion and views into the final decision making has become the order of the da y in most developed countries as of today. Activation of youth parliaments and student convoys of International Relations and Law students travelling from one country to another in search for knowledge and solution to modern day political enigmas and scenarios is a rising trend. United Nations’ Convention on the Rights of Children is also a great breakthrough in the right direction. In light of the articles and clauses of this convention the rights of children to participate in decision making were addressed and implemented in various countries. Developed nations like UK have adopted this convention as one of the primary guidelines to enhance the development of children in its territory and to give them more rights and space to work with (US Census Bureau, 2011). In United States of America, children development is a seriously considered issue and it entails a lot of policy making measures around it. There are several prominent state funded child care and development programs in the US that ensure that children are given the best possible facilities and infrastructure to grow and nourish and flourish. To ensure that children are taken care of well at all times programs such as Child Care and Development Block Grant is one example of state funded programs for children that cater to families belonging

Data Communication and Networking Assignment Example | Topics and Well Written Essays - 250 words

Data Communication and Networking - Assignment Example Using this method, a computer can bypass some access controls or servers or even imitate other computers on a certain network, thus a simple way to hack into the system. A man-in-the-middle attack through DHCP, also known as DHCP spoofing occurs when an attack is initiated, and the attacker tries to make DHCP requests responses by trying to enlist as the default server. In such a case, traffic is intercepted before it is forwarded to the user gateway. BEAST: This is a hacking tool developed in Delphi that infects Windows operating systems. BEAST operates in reverse engineering mode and gets the required codes. It utilizes some ports and can terminate the operations of an antivirus or even a firewall, to gain entry into a victim. RSA is an asymmetric public key algorithm whilst DES uses cipher that is old symmetric. RSA uses two keys, a public one and a private one whilst DES uses one key that is shared. DES can handle large chunks of data, a mechanism that is slow in RSA. Both are secret keys. PGP is standardized software that utilizes the former algorithms and others for operation. PGP is thus not an algorithm per se but has to use the other algorithms but perform the same encryption function (Keith,

What kinds of consent are there Can any of them explain our obligation Essay

What kinds of consent are there Can any of them explain our obligation to obey the state's commands - Essay Example dominion of a prince, which one might leave, every individual has given a tacit consent to his authority, and promised him obedience; it may be answered, that such an implied consent can only have place, where a man imagines, that the matter depends on his choice.† (Hirschhorn 2004), further demonstrates consent and notes, â€Å"Failure to follow ethical principles in the informed consent process can result in serious legal action through tort law (civil wrongdoing) and even criminal law, the lack of informed consent constitutes assault and battery.† Related to political theory, there are three main types of consent that will be explored. They are express, tactic and hypothetical. Although there are other forms in political theory, these are three main to be explored as they are the primary cause for debate within the spectrum. Express consent can be defined as total agreement with an order, demand or request. An example of this would be if someone was asked to meet at a location and they agreed. Another example would be if a state law required that all drivers wore their seatbelt and every driver of that state did while driving. Complying, agreeing and deciding to comply with a request, is express consent. In democratic nations, this is easier to define as the people elect officials to represent them in their best interest. If they do not, then the elected official is not re-elected. People in democratic nations also have the ability to live where they chose and states have individual laws that are not applicable beyond their bounds. (Allsop 2011) states, â€Å"The reasons to obey the law may be either prudential or moral. Prudential reasons are related to self-interest. This theory states members of society conform to the law out of fear of punishment or being socially outcast for being labeled a criminal.† Although people will inherently have express consent for many laws in that state, they may not understand or be aware of all laws they are subject to

How improvements in technology have assisted Mormon missionary work in Essay

How improvements in technology have assisted Mormon missionary work in Africa - Essay Example One of these particular missionary work is concentrated in Africa where missions in the past slowly progressed but is now gaining fruit due to the painstaking efforts and even martyrdom of some of its members. Missions were sent to the different parts of the world, to the so-called Third World, and Africa. President Brigham Young, Joseph Smith’s successor right after the prophet’s death, sent missions to Africa, and the first of these missionaries were Jesse Haven, William H. Walker and Leonard I. Smith, who arrived in Africa in 1853. They immediately started their missionary labor, set up branches and congregations and converted those who wanted to hear the Word of God and the doctrines of the church. At present, there are numerous temples, offices, training centers, and thousands of LDS members in Africa, and the number is still growing because of the fact that each member has to perform mission in the course of membership. All over the world, this church is growing, in size and faith, and overcoming the test of time including persecution. Like any other organization, the LDS church uses the latest technology in the propagation of the faith. They use computers with corresponding Information Technology and software in communicating to their members, databases for use by the different branches worldwide, and the Worldwide Web accessible to the members anywhere in the globe. There are various websites that provide news and information on the LDS church, some of them are listed in the â€Å"Works Cited Page†, which have provided us help in the formulation of this paper. Peoples of different faiths go on missions to preach and propagate their faith. They are no ordinary people because they risk their lives for the sake of their faith. And they have the least idea of what would happen to them in their destination. When the Taliban ruled in Afghanistan, converting to Christianity, preaching the gospel and proselytizing

Ethical Code Of Data Collection Essay Example for Free

Ethical Code Of Data Collection Essay Ethical code is vital to any survey. Researchers today are obliged to follow the different ethical codes designed and guided by different institutions like government agencies, research agencies and marketing associations pertinent to the different countries, societies and communities. This is the first thing researchers should take into consideration while developing or designing research materials. There are ethical code enforcement bodies in almost all layers of our community from local institutions to the federal level, which has the power to control all the research related activities and their impact in the community. Research is highly affected and influenced by ethical codes. One of the major aims of the MRA (Marketing Research Association) ethical code is that while conducting research; researchers should not act in such a way that it violates the general public laws which will discredit people’s confidence against the entire research profession. The research code of ethics is there to establish guidelines and principles to maneuver researchers to achieve the goals and objectives in a socially acceptable manner. Therefore, Marketing Research Association code of ethics guides researchers in almost all layers of their work from their research design phase of the research to the communication of findings of the research to the concerned parties. Some of the principle elements of the MRA ethical codes include: 1. People or the community should be involved as major participants in the all facets of the research. 2. Researchers should get written permission from the people in the community which will be involved in the research project. 3. All the resources (information collected from the community) are direct  assets of that community and therefore researchers should communicate the findings of research to the community and those data should be returned to the community. 4. While publishing the research findings, the community or the people associated with the research should be involved in decision making process. 5. And finally, researchers should make sure that the partners of the research (community) have agreed to make information available to the publication. Above mentioned principles are the major pillars of the MRA ethical code of research. It provides the power to the community and provides the decision making ability to those who are the members or a part of the community. MRA ethical code of research has become a key guiding principle of any research activity. How researchers design their research depends upon MRA’s ethical codes of research, review, and regulation. Respect of the individual person’s or participant’s privacy is the key focus of the research code. It is the degree of control which research participants have over the researchers about their own information and how researchers deal with that information about participants. This code of ethics provides exclusive rights to the research participants about whether to participate in the research or not. In the next level, research code of ethics prioritized the maximization of the benefits of the research to the concerned partner, community or society. A survey result or the research does not always provide advantages or the benefits the community. Therefore, another ethical code of the researchers is to maximize the possible benefits of the research and minimize the harm of research or research findings to its participants or community. Researchers should always have a sense of justice towards its research. Researchers can never include all the members or elements of its target population, therefore while selecting the sample they should be non-discriminatory. By doing so, researchers not only do justice to the participants or the community but also maximize the chances of integrity of the research findings. Another important issue of the research ethical code is the confidentiality of the information provided by the research participants. Researchers are  liable to provide highest level confidentiality of the data towards the participants. MRA research code of ethics makes sure that researchers provides complete confidentiality to its research participants unless the respondent or the participants of the research themselves waives their confidentiality. Besides these basic ethical codes of data collection, researchers should not falsify or omit collected data for any reason during the data collection process. And before collecting the data researchers should specify the methods of data collection, time and date of data collection, sampling frame and method and sampling size and these predetermined methodologies are not subject to change without the permission of the research participants. Data collectors should not reveal the information about the client or sponsor to the participants during the data collection phase without proper authorization. If the respondent wants to know about the sponsor or the clients then the data collectors can only reveal the information only to respondent with the authorization to do so by the clients or sponsor. The data collectors are liable to protect the confidentiality regarding the business of the client without the express written consent of the client and without the necessary ground to do so. If the data collectors are conducting the secondary data collection then revealing the source of the data to their client is their prime responsibility and they should not present secondary data as primary data to their clients or sponsor. If a respondent wants to withdraw or refused to participate in the middle of the data collection process then the data collectors or the researchers have no right to coerce them or make the cooperation obligatory by threatening them with anything. Researchers or the data collectors should always respect and protect the right to participate and right not to participate in the research by the respondent at any time from beginning to the end of data collection. The result of the study or the collected data is the property of the clients or the sponsor therefore, researchers or the data collectors should not at any cost share the findings of the collected data to the third party without the pre-consent of the clients or sponsor. Researchers are liable to follow the standard ethical code of data collections coordinated and enforced by the agencies like Marketing Research Association and federal agencies. References Marketing Research Association (2012). Retrieved on October 5, 2014 from www.mra-net.org Malhotra, N. K. (2010). Marketing Research an Applied Orientation (Sixth ed.). Upper Saddle River, NJ: Prentice Hall.

Theoretical Analysis of the Banking Crisis

Theoretical Analysis of the Banking Crisis Crisis in the banking sector The current crisis and the Great Depression Theories and the crises: Several theories exist connected to the financial crises that have happened since the banking system was established. Some of them tried to explain the reasons and the origin of them however none of these theories could provide an acceptable solution how to prevent the crisis. To determine the continuity in the timeline and the spread of the crisis it was not enough to create just an economic comparison. The analysts set some mathematical and other type of model to investigate the behavior of the market. The two mostly accepted models of banking panics are the Diamond and Dybvig model and the Calomiris and Kahn model. These models were set in the 1990s as the reflection of the systematic banking crisis since 1970.Both of the two theories were accepted the fact that the banks liabilities are more liquid than its assets. In the Diamond and Dybvig model they set a hypothetical world without the banking system. The banks make contract to transform its illiquid assets.( Federal Reserve Bank of Minneapolis Quarterly Review Vol. 24, No. 1, winter 2000, pp. 14-23, Dybvig: Bank Runs, Deposit Insurance, and Liquidity).The problems with the contract is that it doesnt include any risk-sharing option. The deposit insurance is the only way to reduce the risk because its decrease the ability of the bank to transform its assets. The asymmetric information affects the liquidity demand. The final conclusion of this model is that the bank run is triggered only because patient agents believe.†This result is a self-fulfilling prophecy (panic): Because patient agents expect other patient agents to withdraw their funds early, they do the same. As a consequence too many funds are actually withdrawn, which otherwise would have not been the case. (Banking and Finance /Banking Crises.ppt/2008.12.03)† The Calomiris and Kahn model basis is the Diamond and Dybvig model, but it is more complex (Charles W. Calomiris, Charles M. Kahn, â€Å"The Role of Demandable Debt in Structuring Optimal Banking Arrangements† in American Economic Review, Vol. 81, 1991). They introduced one other potential option that the banks follow a risky behavior and put their investors money into risky projects. Because the asymmetric information the investors dont know about this step. Then, two possible things can happen; the project turns out well or not. If the project turns out negatively the bank starts to invest again. In the model the depositors can purchase information, but if is shows a negative indicator they withdraw their money. If there are a huge number of the depositors who want to withdraw the bank has serious liquidity problems and the bank panic starts. The only possible solution, according to this model, is to increase monitoring in the banking sector and strengthen the regulation to avoid moral hazard. I. The Great Depression 1. The beginning of the Great Depression (1928-30) The history of the Great Depression is important to analyze the main aspect of the crisis. From May of 1928 the stock market rise continuously and the average stock price increased because the FED raised its discount rate, and saw the stock market was booming and the stock price doubled, as excessive speculation. They tried to resolve this by increased monetary policy to raise interest rate and a new deflationary policy was introduced. As a consequence, a huge financial bubble evolved. In October 22, 1929 New York Times published an article; â€Å"Fisher Says Prices of Stocks Are Low†. (The 1929 Stock Market: Irving Fisher Was Right, Ellen R. Mc Grattan p.1) Then, two days later the stock market went crashing and the stock prices had fallen by 30 %: According to Irving Fisher the problem was that the people have been speculating on the small margins. It was not that the stock market was too high, but the people so enthusiastic to making money that they properly expected to mak e. It created debts because the people bought stocks on borrowed money. The politicians issued optimistic predictions to prevent the selling panic in the U.S. market (The causes of the 1929 stock market crash, Harold Bierman).The secretary of the Treasury, Andrew W. Melon stated: â€Å"There is no cause to worry. The high tide of prosperity will continue†. The stock market did come back in the middle of 1930, more than half of the stock that has been decline as been reversed. People thought it was over recession turned into something different. The agriculture sector stocks continued to decline. This regressive tendency was intensive not only because the Great Depression. Massive overproduction started in the European agricultural production sector after the World War I to recover the lack of the agricultural goods. To increase the legislative protection of the domestic farmers the Smoot-Hawley Tariff Act of June 1930 raised U.S. import tariffs (U.S Department of State, http://future.state.gov/). The Smoot-Hawley Tariff declined the international trust and cooperation and caused some problems in international trade. As a result of market crush bank collapsed from October 1930 until March 1933 by this time over a third of Americans bank was out of business. It continued to decline by mid 1932, the stock had declined to 10% their value in the peak 1929 and the increase in this in uncertainty from unsettled business conditions created by economic contraction made adverse selection and moral hazard problem worse in credit market. (The great crash, 1929, John Kenneth Galbraith) There was reduction in the number of intermediation due to loss of one-third of banks. This only increases adverse selection and moral hazard problem. Funds to firm with productive investment opportunities were greatly decreased due to this problem. In some sectors like manufacturing sector the production fell dramatically which was the basis of the Firms wage rates cuts. The level of price fell by 25% in the period of 1930-1933. Debt deflation was triggered in which net worth fell C:Documents and SettingsJudyAsztalunemploymen t.gifbecause of the increase burden of indebtedness borne on the firm. One sector problems affected the others. Millions of people lost their jobs. In the period of 1900-1947 two types of unemployment were made. These researches were developed the data set for the civilian labor force and for the Non-farm employees. (Historical unemployment in relation to today, A. Andrews)The employment rate declined by approximately 20% and the economic contraction and unemployment rose to 25 percent because of the decline in net worth. The result was more increase in adverse selection and moral hazard in the credit market. This was the worst ever experienced in the United States of America. 2. The FED This system was introduced to the public as economic stabilizer in 1913 to prevent further economic crisis although Federal Reserve System was totally passive during the Great Depression. In general, the Federal Reserve controls the interest rates and the money supply (inflation).The FED is controlled by its Board members and the majority of the twelve member Constitute the Federal Open Market Committee with five Reserve Bank The Fed not only supply the money to economy, it loans the money to them at interest. Besides, it regulates the value of the currency being issued. It should have acted as the last resort to lend as that its role. For the period of 1921-1929 the FED increased the money supply by 62% .The main reasons they did nothing was they never anticipated the negative of bank failure could have on money supply and economic activity. They thought a bank failure is as a consequence of poor bank management or bad banking practice. Small banks failures were the first to be affe cted in the bank panics in the early stages. And since the big city bank was the most influential they saw the failure of the small banks as complacency. Some suggested that political role might have played an important role in the passivity of the Federal Reserve System at that period. The New York Federal Reserve System was the most dominant force in the 1928, and it supported the Fed in open market purchase to lend money to the banks during the bank panics. This was opposed by other powerful member in the Federal Reserve System and the New York position was out voted. There were multiple causes and many theories about the origin of the Great Depression. According the monetarist theory the Crisis is the consequence of the lack of the FEDs policy making. The level of government influence on a bank varies from one country to another let say for example, in China the government regulation is very high probably the highest in the world and in United Kingdom the government regulation i s very low .It can be said that in the United Kingdom it high if we compare with the United State. So depending of which countries are comparing to another, government influence is usually different. 3. The economic decline (1930-32) Thanks to the Tariff Act the world market suffered a huge damage but, the act was not enough to recover the U.S. economy. People starting lose their jobs, homes and their confidence to the system and they take out their money from the banks and in the end they couldnt repay their loans. The continuous decline shows the effect in political elections in November 1930 when the representatives of the Republican Party lost their places in the Senate and their number and voting power reduced dramatically. In 1931 some new predictions appeared in the news which says that the depression would be over in the end of that year. During this year the deepening economic depression hit Europe and credit structures collapsed there. The media blamed United States for create this depression by cutting back on imports. Various conspiracy theories were voiced about the Soviet Union and some Biblical prophecy appeared too. In1932 a new presidential campaign started where Hoover and Roosevelt describe two different political aspects about the Depression. Hoovers economic aspect based on voluntarism and individualism, but the natural economic forces and the voluntary action by business groups couldnt work in the last 3 years. So his voters lost the trust in Hoover and he was easily beaten in the election (Burner David, Herbert Hoover: Alfred A. Knopf, New York, 1979). 4. The New Deal Roosevelt the new president was introduced a new program called the New Deal that contained social and economic reforms in 1933. He settled up new governmental agencies with the Glass-Steagall Act. â€Å"It gave tighter regulation of national banks to the Federal Reserve System; prohibited bank sales of securities; and created the Federal Deposit Insurance Corporation (FDIC), which insures bank deposits with a pool of money appropriated from banks. (New York Times, http://topics.nytimes.com /topics/reference/ timestopics/subjects/g/glass_steagall_act_1933/index.html )â€Å" The senate tried to restore the peoples trust in the U.S financial system with the Glass-Steagell Act .It made a clear separation between the investment and the commercial banks .To handle the banks poor asset management Franklin Roosevelt declared a â€Å"bank holiday â€Å"as a result of bank panic in March 1933.The† bank holiday† regulated that the banks had to be until the governmental inspecto r investigation. The inspector after a monitoring process judged about the banks reopening. Another program was started namely in that time: the Agricultural Adjustment Act which helped to increase the income of the farmers. The overproduction created corps surplus and the government pay the farms, in the frame of this program, to leave the fields fallow and not to raise pigs and lambs. (Ronald Edsforth: The New Deal: Americas Response to the Great Depression, 2000) The Act aimed to raise the value of the corps, but few months later, natural disasters destroyed almost all the corps and the machinery. To help the farmers and teach them how to measure and reduce erosion the government established the Soil Conservation Service. This program stopped in 1936 when a new agricultural act had been accepted. The new regulation provides a possibility to the farmers to get federal subsidies. Besides of this, NIRA (National Industrial Recovery Act) had been accepted by the government to generate more jobs, strengthen the right of collective bargaining. The unemployment increased since the Great Depression had started. Based on this reason, they provided jobs in government projects such as work camps. Approximately two million people participated in this program until 1934. The unskilled workers got hard work like digging and railway repairs but they earned only a little money. National Labor Relations Act introduced new fair labor practices in 1935.The New Deal program had helped the US economy but didnt bring the end of the Great Depression. The roots of the economic problem came from the financial insecurity and the distribution of money, because the people on relief lived from one day to another (Bernardit Bellushit, The Failure of the NRA (1975)). The investors were afraid of buying sto cks and lose their money. The companies couldnt sell their new products because the people spent their money to food. The inventories were full and nobody wanted to produce more and that stopped the cycle of the economy. 5. The Second New Deal President Roosevelt decided to set a group of new economic and social measures and provided some legislative initiatives. The public and political forces lead the president to make some radical steps. . In 1936 Roosevelt won the election but the Americans wanted the government to take greater responsibility for the welfare of the nation. The Second New Deal as legislative program established some government controlled agencies and projects. He allocated billions of dollars to start and give a financial budget for the Work Progress Administration (WPA).Roosevelt nominated the social worker Harry Hopkins to be the head of the WPA. In its early years it focused on the construction programs such as build schools and government buildings. Attempt to the population of the United States it found that the one of every six people was unemployed and most of them was unskilled (http://www.u-shistory .com /pages /h1599.html). Unskilled laborers the forgotten man of past generation works at decen t wages. The nation was building and repairing schools, public buildings, community centers and airports to meet the changing needs of the modern world. In one project twelve hundred men were employed to improve bowling field and construct building hangers and administration buildings. In addition to the hundreds of the unskilled laborers, many skilled workers were employed in this improvement project. Hundreds of homes have been treated from bondage of property. In New York City WPA housing demolisher project was started which improved the families living conditions. In many other cities of the country old firetraps are being demolished to make way to modern buildings. Swimming pools and parks were constructed to make more public value to the community and remove the children from the streets. In many parts of the country nursery schools were established to where almost 10 thousand children got hot meals, supervised train activities. In these projects employment has been provided 6 00 hundred teachers nurses dieticians and cooks. More than 300 thousand adults learned to read and write first time in their life and started to learn foreign languages from native teachers. In cooperation with the national youth administration 26500 young man and women were employed as instructors laboratory assistants and clerical helpers.( Historical unemployment in relation to today, A. Andrews) Clerical white -collar workers find employment at filling and checking important land records. As part of the program of rehabilitation of the conservation of human resources a number of household training school were established by WPA. In these school girls from relief families are prepared for domestic works. Health education is an important part of the WPA program in a number health centers in large cities teaches the proper care of the children and adults. In some cities sawing rooms were established to support the poor families with clothes. Another type of permanent construction was the community stadium as a representative a large group of project provides the public gatherings all over America. Hundreds of new bridges were constructed thousands of old bridges have been repaired and made safe. In Many cities the construction was undertaken with the cooperation of the public health agencies. The rapid growth of air traffic gives the opportunity to built modern airports and gives a job to thousand s to improve and repair the existing facilities. The increased air transportation also made necessary the development of hundreds of emergency landing fields. In cooperation with the local police departments in several cities automobile inspection stations were established to reduce the unsafe vehicles on the roads. Women who had the principle to support their families are paid for the work. And the product they made was distributed free to the families on relief (John Salmond, The New Deal: The National Level (1975). pp. 188-89). Many other type of employment was provided for women and other part-time jobs were provided in kitchen and in libraries and schools. As a result of some projects thousand of books and maps were translated. This program also contained training for adults t o learn tailoring. The financial support of the administration was enough to invest into more projects like Federal Writers Projects , Federal Theater Project, Federal Art Project, National youth Administration ,to generate more jobs for white-collar workers.â€Å"Because Harry Hopkins believed that the work provided by the WPA should match the skills of the unemployed, artists were employed to paint murals in public buildings, sculptors created park and battlefield monuments, and actors and musicians were paid to perform. These white-collar programs did not escape criticism and the term â€Å"boondoggling† was added to the English language to describe government projects of dubious merit.( Jim Crouch, The Works Progress Administration Eh. Encyclopedia(2004)). The WAP was a long program and finally was abandoned in 1943.Social security act created a new health insurance system based on employer and employee contributions, supported by taxes 6. The SWOT Analysis of the WPA SWOT Strengths: Weaknesses: Education to unskilled workers Started project didnt wanted Various types of jobs WPA as Financial â€Å"black hole† Provide part-time jobs Political influences Jobs for Artist and Black people and Women No ability to control the workers productivity Improve the health care system Opportunities : Threats: Starting more useful projects Instable economical environment Decreasing political aspects of the projects Living expenses increases, because import stop Strengthen the economy throughout projects Potential health problems, disease could stop projects Developing international export-import partnerships Other political parties critics-political intervention Support the banking act, provide more financial security The SWOT analysis is for compute the Strength, Weaknesses, Opportunities and Threats of a sector or a company (Mehta, S. (2000) Marketing Strategy). It is used for strategic planning to create a way to the desired goal or objective. In this case it was decided to apply this technique to set a real picture about the Second New Deal through WPA. The main aim of the current analysis is not generate alternative strategies, but to summarize the situation of WPA and the critiques in 1930s.Starting with the strength of the WPA it can be seen that the group of different types of jobs were provided to a high-scale target area. People could achieve different skills by the WPAs trainings and educations, and they got motivation to learn and use their knowledge in long-term. There were several weaknesses of the program from the beginning. As a governmental project the WPA needed a huge financial background to work and in some cases they only waste the money. The critiques described that some part of the program was only started to get more votes. The real leaders of the WPA had no ability to control the workers productivity and their effectiveness. To mention some real threats the instable economic environment remained the same. The diseases could spread faster among the workers and it may stop many constructing projects and it may indicate more financial problems in the health care system. One of the most important opportunities was to prevent more political fight and decrease the obvious political aspects of the projects. It would have been useful if they could solve the import problems. The following table above contains the main strength, weaknesses, opportunities and threats. 6.1. The external factor analysis EFAS (External Factor Analysis Summary) External Factors: Weight Ratings Weighted Score Opportunities: O1 Starting more projects 0,1 3 0,3 O2 Decreasing political aspects of the projects 0,2 4 0,8 O3 Strengthen the economy through projects 0,05 3 0,15 O4 Developing international export-import partnerships 0,1 2 0,2 O5 Support the banking act, provide more financial security 0,05 3 0,15 Threats: T1 Instable economical environment 0,2 4 0,8 T2 Living expenses increases, because import stop 0,1 3 0,3 T3 Potential health problems, disease could stop projects 0,05 2 0,1 T4 Other political parties critics-political intervention 0,15 3 0,45 Total Scores: 1 1,0-5,0 3,25 The SWOT table can be used to introduce three other type of analysis the EFAS, the IFAS and the SFAS. The External factor analysis and the internal factor analysis are calculated in a same way. The external factors (opportunities, threats) are used to show the economic background of the company or the sector. The elements of the SWOT table are the main factors of these tables. Every row contains weights and the rates and the multiplied result; the weighted score. The sum of every weight has to equal by 1, and the factors ratings should be between 1 and 5.The total score will be the sum of the weighted scores and it shows a real picture about the companys position. The company is in danger if the result is less 3,5 than. 6.2 The internal factor analysis IFAS(Internal Factor Analysis Summary ) Internal Factors: Weight Ratings Weighted Score Strenghts: Education to unskilled workers 0,15 3 0,45 Various types of jobs 0,15 4 0,6 Provide part-time jobs 0,1 3 0,3 Jobs for Artist and Black people and Women 0,2 2 0,4 Improve the health care system 0,1 3 0,3 Weaknesses: Started project didnt wanted 0,05 3 0,15 WPA as Financial â€Å"black hole† 0,05 2 0,1 Political influences 0,1 4 0,4 No ability to control the workers productivity 0,1 3 0,3 Total Scores: 1 1,0-5,0 3 If the result is more than 3,5, the company is in safe. The internal factors (Strengths, Weaknesses) are closely related to the object of the analysis. The internal strengths and weaknesses summarize the main topics the company has to deal with. The total score is 3 and this means that the company is not in safe and for a long -term basis the management has to handle the weaknesses to strengthen the company position in the market. SFAS(Strategic Factor Analysis Summary ) Factors: Weight Ratings Weighted Score Duration (in terms) S Strenghts: Short Medium Long S1 Education to unskilled workers 0,2 3 0,6 X S4 Jobs for Artist and Black people and Women 0,2 4 0,8 X W Weaknesses: W3 Political influences 0,15 4 0,6 X W4 No ability to control the workers productivity 0,1 2 0,2 X O Opportunities: O1 Starting more projects 0,05 5 0,25 X O2 Decreasing political aspects of the projects 0,05 1 0,05 X T Threats: T1 Instable economical environment 0,2 4 0,8 X T4 Other political parties critics-political intervention 0,05 3 0,15 X Total Scores: 1 1,0-5,0 3,45 6.3. The Strategic Factor Analysis Summary The Strategic Factor Analysis Summary (Business Policy and Strategy lecture SFAS power point presentation 2008.12.03) has an additional column, the duration that is separated into three different parts; long-term, medium-term, and short-term .The most important factors are listed here with weights and ratings to represent the main internal and external aspects of the WPA and to make a summary about the problems and possibilities. As a conclusion, based on the analysis listed below, the SFAS ‘s weighted score is 3,45.It means that the WPA could work in a long-term if the leadership could handle the problems. The WPA project stopped in 1944; therefore the main reasons did not connected to the internal factors, but only the externals. Some critiques had right the all the projects of WPA had only a political step to achieve more cotes in the elections. 7. The worlds reaction to the Great Depression (Theories) The world reacted in a several way to the Great depression and created a lot of theories how to solve the situation. The most famous reaction was the communism, fascism and the Keynesian theory. The fascism took place in Germany, Italy and it represented a highly centralized economy. The public construction programs provided jobs for unskilled labourers to built roads, work camps and military facilities. It increased the demography of the population, but the system was highly dictatorial. According to the statistics the unemployment rate decreased dramatically from 6 million to 0.2 million people.The Communism, as a highly bureaucratic and centralized system, was one of response to the Great Depression. It focused to fully employ the people in a strictly regulated obligatory way. The Keynesian theory: It states that the fully employment is needed, but only the intervention of the government can create this possibility. It can be long -term purpose of the existence of the government. The Keynesian theory changed the way of the thinking about the unemployment. The idea of the welfare state was another solution of the crisis. The education, the minimal guarantee of a job to every citizen is the basis of a welfare system. It guarantees the minimum wages and the minimum social and healthcare system. II. The Current Financial Crisis 1. The beginning of the Current Crisis The current financial crisis started in 2007, but it was not until the last quarter of 2008 .Firstly, this part of the thesis going to show how it all started, the causes and those who were affected by the crisis and how they are trying to deal with the crisis. Most of the people are pointing directly to real estate as the major cause of the current financial crisis even financial institutions that not directly involve with real estate are affected. It can be seen how the subprime mortgages and unscrupulous lenders has caused the unsustainable real estate bubble which began to collapse in 2006.There was increase in homeownership in the United State to about 5 million in little more than six years thanks to the increase in subprime lending. Within these six years constructions of new house sing units grew more but this housing bubble could not grow forever. In this period the price of house went so high and rent price went so low. When the price of housing began to decrease in the lat e 2006 to early 2007, many subprime borrowers had very hard time to make their payment. The housing bubble or the excesses of the subprime mortgage market became even more evident when subprime mortgage lender filed for bankruptcy. All the sectors like households, businesses (including financial institutions), and government are the main participants in the financial market and hit by the crisis. The secondly related financial groups are the surplus units provide funds and while the other group that enter the financial market to obtain fund are the deficit units. If market securities yield low returns why invest in it? Three factors can be seen to why it important to make investment in market securities these are, as we have said before the advantage to convert to cash rapidly so it can be substitute as cash. The second reason is that when a firm has excess cash let say for a month it can invest the excess cash in form of securities as not to hold too much cash in hand. The third reason is that when a firm know it going to pay a loan soon it gathers the money monthly to pay and this money could be invest in market securities before the loan is to be paid. As it have seen when the financial crisis started the public could see that the financial system is in a deep trouble some even call it recession because the stock market came crashing and lost almost 42% of it original price. Before the peak of the financial crisis the total world stock market worth $62.5 trillion and now it $36.6 trillion so it lost $25.9 trillion. Let compare the stock market of leading countries of one day and another day and see how it doing. STOCK MARKETS May 5 prev %chg SP 500 903.8 907.24 -0.38 Nasdaq Comp 1754.12 1763.56 -0.54 Dow Jones Ind 8410.65 8426.74 -0.19 FTSEurofirst 300 846.81 842.7 +0.49 DJ Euro Stoxx 50 2407.55 2419.53 -0.50 FTSE 100 4336.94 4243.22 +2.21 FTSE All-Share UK 2226.6 2174.64 +2.39 CAC 40 3225.0 3237.97 -0.40 Xetra Dax 4853.03 4902.45 -1.01 Nikkei (c) 8977.37 Hang Seng 16430.08 16381.05 +0.30 FTSE All World $ 153.46 153.19 +0.18 ( source New York Times May 5 2008) There was turmoil in the all over the international financial system due to the losses in the subprime mortgage in the mid-2007.This was wide spread global crisis even thus firm not associated with the mortgage firm. This made the financial institutions very nervous and the stock market got very weak. Between July 2007 and March 2008, there was a significantly drop in the price of shares in the large, small and investment bank. A Theoretical Analysis of the Banking Crisis Theoretical Analysis of the Banking Crisis Crisis in the banking sector The current crisis and the Great Depression Theories and the crises: Several theories exist connected to the financial crises that have happened since the banking system was established. Some of them tried to explain the reasons and the origin of them however none of these theories could provide an acceptable solution how to prevent the crisis. To determine the continuity in the timeline and the spread of the crisis it was not enough to create just an economic comparison. The analysts set some mathematical and other type of model to investigate the behavior of the market. The two mostly accepted models of banking panics are the Diamond and Dybvig model and the Calomiris and Kahn model. These models were set in the 1990s as the reflection of the systematic banking crisis since 1970.Both of the two theories were accepted the fact that the banks liabilities are more liquid than its assets. In the Diamond and Dybvig model they set a hypothetical world without the banking system. The banks make contract to transform its illiquid assets.( Federal Reserve Bank of Minneapolis Quarterly Review Vol. 24, No. 1, winter 2000, pp. 14-23, Dybvig: Bank Runs, Deposit Insurance, and Liquidity).The problems with the contract is that it doesnt include any risk-sharing option. The deposit insurance is the only way to reduce the risk because its decrease the ability of the bank to transform its assets. The asymmetric information affects the liquidity demand. The final conclusion of this model is that the bank run is triggered only because patient agents believe.†This result is a self-fulfilling prophecy (panic): Because patient agents expect other patient agents to withdraw their funds early, they do the same. As a consequence too many funds are actually withdrawn, which otherwise would have not been the case. (Banking and Finance /Banking Crises.ppt/2008.12.03)† The Calomiris and Kahn model basis is the Diamond and Dybvig model, but it is more complex (Charles W. Calomiris, Charles M. Kahn, â€Å"The Role of Demandable Debt in Structuring Optimal Banking Arrangements† in American Economic Review, Vol. 81, 1991). They introduced one other potential option that the banks follow a risky behavior and put their investors money into risky projects. Because the asymmetric information the investors dont know about this step. Then, two possible things can happen; the project turns out well or not. If the project turns out negatively the bank starts to invest again. In the model the depositors can purchase information, but if is shows a negative indicator they withdraw their money. If there are a huge number of the depositors who want to withdraw the bank has serious liquidity problems and the bank panic starts. The only possible solution, according to this model, is to increase monitoring in the banking sector and strengthen the regulation to avoid moral hazard. I. The Great Depression 1. The beginning of the Great Depression (1928-30) The history of the Great Depression is important to analyze the main aspect of the crisis. From May of 1928 the stock market rise continuously and the average stock price increased because the FED raised its discount rate, and saw the stock market was booming and the stock price doubled, as excessive speculation. They tried to resolve this by increased monetary policy to raise interest rate and a new deflationary policy was introduced. As a consequence, a huge financial bubble evolved. In October 22, 1929 New York Times published an article; â€Å"Fisher Says Prices of Stocks Are Low†. (The 1929 Stock Market: Irving Fisher Was Right, Ellen R. Mc Grattan p.1) Then, two days later the stock market went crashing and the stock prices had fallen by 30 %: According to Irving Fisher the problem was that the people have been speculating on the small margins. It was not that the stock market was too high, but the people so enthusiastic to making money that they properly expected to mak e. It created debts because the people bought stocks on borrowed money. The politicians issued optimistic predictions to prevent the selling panic in the U.S. market (The causes of the 1929 stock market crash, Harold Bierman).The secretary of the Treasury, Andrew W. Melon stated: â€Å"There is no cause to worry. The high tide of prosperity will continue†. The stock market did come back in the middle of 1930, more than half of the stock that has been decline as been reversed. People thought it was over recession turned into something different. The agriculture sector stocks continued to decline. This regressive tendency was intensive not only because the Great Depression. Massive overproduction started in the European agricultural production sector after the World War I to recover the lack of the agricultural goods. To increase the legislative protection of the domestic farmers the Smoot-Hawley Tariff Act of June 1930 raised U.S. import tariffs (U.S Department of State, http://future.state.gov/). The Smoot-Hawley Tariff declined the international trust and cooperation and caused some problems in international trade. As a result of market crush bank collapsed from October 1930 until March 1933 by this time over a third of Americans bank was out of business. It continued to decline by mid 1932, the stock had declined to 10% their value in the peak 1929 and the increase in this in uncertainty from unsettled business conditions created by economic contraction made adverse selection and moral hazard problem worse in credit market. (The great crash, 1929, John Kenneth Galbraith) There was reduction in the number of intermediation due to loss of one-third of banks. This only increases adverse selection and moral hazard problem. Funds to firm with productive investment opportunities were greatly decreased due to this problem. In some sectors like manufacturing sector the production fell dramatically which was the basis of the Firms wage rates cuts. The level of price fell by 25% in the period of 1930-1933. Debt deflation was triggered in which net worth fell C:Documents and SettingsJudyAsztalunemploymen t.gifbecause of the increase burden of indebtedness borne on the firm. One sector problems affected the others. Millions of people lost their jobs. In the period of 1900-1947 two types of unemployment were made. These researches were developed the data set for the civilian labor force and for the Non-farm employees. (Historical unemployment in relation to today, A. Andrews)The employment rate declined by approximately 20% and the economic contraction and unemployment rose to 25 percent because of the decline in net worth. The result was more increase in adverse selection and moral hazard in the credit market. This was the worst ever experienced in the United States of America. 2. The FED This system was introduced to the public as economic stabilizer in 1913 to prevent further economic crisis although Federal Reserve System was totally passive during the Great Depression. In general, the Federal Reserve controls the interest rates and the money supply (inflation).The FED is controlled by its Board members and the majority of the twelve member Constitute the Federal Open Market Committee with five Reserve Bank The Fed not only supply the money to economy, it loans the money to them at interest. Besides, it regulates the value of the currency being issued. It should have acted as the last resort to lend as that its role. For the period of 1921-1929 the FED increased the money supply by 62% .The main reasons they did nothing was they never anticipated the negative of bank failure could have on money supply and economic activity. They thought a bank failure is as a consequence of poor bank management or bad banking practice. Small banks failures were the first to be affe cted in the bank panics in the early stages. And since the big city bank was the most influential they saw the failure of the small banks as complacency. Some suggested that political role might have played an important role in the passivity of the Federal Reserve System at that period. The New York Federal Reserve System was the most dominant force in the 1928, and it supported the Fed in open market purchase to lend money to the banks during the bank panics. This was opposed by other powerful member in the Federal Reserve System and the New York position was out voted. There were multiple causes and many theories about the origin of the Great Depression. According the monetarist theory the Crisis is the consequence of the lack of the FEDs policy making. The level of government influence on a bank varies from one country to another let say for example, in China the government regulation is very high probably the highest in the world and in United Kingdom the government regulation i s very low .It can be said that in the United Kingdom it high if we compare with the United State. So depending of which countries are comparing to another, government influence is usually different. 3. The economic decline (1930-32) Thanks to the Tariff Act the world market suffered a huge damage but, the act was not enough to recover the U.S. economy. People starting lose their jobs, homes and their confidence to the system and they take out their money from the banks and in the end they couldnt repay their loans. The continuous decline shows the effect in political elections in November 1930 when the representatives of the Republican Party lost their places in the Senate and their number and voting power reduced dramatically. In 1931 some new predictions appeared in the news which says that the depression would be over in the end of that year. During this year the deepening economic depression hit Europe and credit structures collapsed there. The media blamed United States for create this depression by cutting back on imports. Various conspiracy theories were voiced about the Soviet Union and some Biblical prophecy appeared too. In1932 a new presidential campaign started where Hoover and Roosevelt describe two different political aspects about the Depression. Hoovers economic aspect based on voluntarism and individualism, but the natural economic forces and the voluntary action by business groups couldnt work in the last 3 years. So his voters lost the trust in Hoover and he was easily beaten in the election (Burner David, Herbert Hoover: Alfred A. Knopf, New York, 1979). 4. The New Deal Roosevelt the new president was introduced a new program called the New Deal that contained social and economic reforms in 1933. He settled up new governmental agencies with the Glass-Steagall Act. â€Å"It gave tighter regulation of national banks to the Federal Reserve System; prohibited bank sales of securities; and created the Federal Deposit Insurance Corporation (FDIC), which insures bank deposits with a pool of money appropriated from banks. (New York Times, http://topics.nytimes.com /topics/reference/ timestopics/subjects/g/glass_steagall_act_1933/index.html )â€Å" The senate tried to restore the peoples trust in the U.S financial system with the Glass-Steagell Act .It made a clear separation between the investment and the commercial banks .To handle the banks poor asset management Franklin Roosevelt declared a â€Å"bank holiday â€Å"as a result of bank panic in March 1933.The† bank holiday† regulated that the banks had to be until the governmental inspecto r investigation. The inspector after a monitoring process judged about the banks reopening. Another program was started namely in that time: the Agricultural Adjustment Act which helped to increase the income of the farmers. The overproduction created corps surplus and the government pay the farms, in the frame of this program, to leave the fields fallow and not to raise pigs and lambs. (Ronald Edsforth: The New Deal: Americas Response to the Great Depression, 2000) The Act aimed to raise the value of the corps, but few months later, natural disasters destroyed almost all the corps and the machinery. To help the farmers and teach them how to measure and reduce erosion the government established the Soil Conservation Service. This program stopped in 1936 when a new agricultural act had been accepted. The new regulation provides a possibility to the farmers to get federal subsidies. Besides of this, NIRA (National Industrial Recovery Act) had been accepted by the government to generate more jobs, strengthen the right of collective bargaining. The unemployment increased since the Great Depression had started. Based on this reason, they provided jobs in government projects such as work camps. Approximately two million people participated in this program until 1934. The unskilled workers got hard work like digging and railway repairs but they earned only a little money. National Labor Relations Act introduced new fair labor practices in 1935.The New Deal program had helped the US economy but didnt bring the end of the Great Depression. The roots of the economic problem came from the financial insecurity and the distribution of money, because the people on relief lived from one day to another (Bernardit Bellushit, The Failure of the NRA (1975)). The investors were afraid of buying sto cks and lose their money. The companies couldnt sell their new products because the people spent their money to food. The inventories were full and nobody wanted to produce more and that stopped the cycle of the economy. 5. The Second New Deal President Roosevelt decided to set a group of new economic and social measures and provided some legislative initiatives. The public and political forces lead the president to make some radical steps. . In 1936 Roosevelt won the election but the Americans wanted the government to take greater responsibility for the welfare of the nation. The Second New Deal as legislative program established some government controlled agencies and projects. He allocated billions of dollars to start and give a financial budget for the Work Progress Administration (WPA).Roosevelt nominated the social worker Harry Hopkins to be the head of the WPA. In its early years it focused on the construction programs such as build schools and government buildings. Attempt to the population of the United States it found that the one of every six people was unemployed and most of them was unskilled (http://www.u-shistory .com /pages /h1599.html). Unskilled laborers the forgotten man of past generation works at decen t wages. The nation was building and repairing schools, public buildings, community centers and airports to meet the changing needs of the modern world. In one project twelve hundred men were employed to improve bowling field and construct building hangers and administration buildings. In addition to the hundreds of the unskilled laborers, many skilled workers were employed in this improvement project. Hundreds of homes have been treated from bondage of property. In New York City WPA housing demolisher project was started which improved the families living conditions. In many other cities of the country old firetraps are being demolished to make way to modern buildings. Swimming pools and parks were constructed to make more public value to the community and remove the children from the streets. In many parts of the country nursery schools were established to where almost 10 thousand children got hot meals, supervised train activities. In these projects employment has been provided 6 00 hundred teachers nurses dieticians and cooks. More than 300 thousand adults learned to read and write first time in their life and started to learn foreign languages from native teachers. In cooperation with the national youth administration 26500 young man and women were employed as instructors laboratory assistants and clerical helpers.( Historical unemployment in relation to today, A. Andrews) Clerical white -collar workers find employment at filling and checking important land records. As part of the program of rehabilitation of the conservation of human resources a number of household training school were established by WPA. In these school girls from relief families are prepared for domestic works. Health education is an important part of the WPA program in a number health centers in large cities teaches the proper care of the children and adults. In some cities sawing rooms were established to support the poor families with clothes. Another type of permanent construction was the community stadium as a representative a large group of project provides the public gatherings all over America. Hundreds of new bridges were constructed thousands of old bridges have been repaired and made safe. In Many cities the construction was undertaken with the cooperation of the public health agencies. The rapid growth of air traffic gives the opportunity to built modern airports and gives a job to thousand s to improve and repair the existing facilities. The increased air transportation also made necessary the development of hundreds of emergency landing fields. In cooperation with the local police departments in several cities automobile inspection stations were established to reduce the unsafe vehicles on the roads. Women who had the principle to support their families are paid for the work. And the product they made was distributed free to the families on relief (John Salmond, The New Deal: The National Level (1975). pp. 188-89). Many other type of employment was provided for women and other part-time jobs were provided in kitchen and in libraries and schools. As a result of some projects thousand of books and maps were translated. This program also contained training for adults t o learn tailoring. The financial support of the administration was enough to invest into more projects like Federal Writers Projects , Federal Theater Project, Federal Art Project, National youth Administration ,to generate more jobs for white-collar workers.â€Å"Because Harry Hopkins believed that the work provided by the WPA should match the skills of the unemployed, artists were employed to paint murals in public buildings, sculptors created park and battlefield monuments, and actors and musicians were paid to perform. These white-collar programs did not escape criticism and the term â€Å"boondoggling† was added to the English language to describe government projects of dubious merit.( Jim Crouch, The Works Progress Administration Eh. Encyclopedia(2004)). The WAP was a long program and finally was abandoned in 1943.Social security act created a new health insurance system based on employer and employee contributions, supported by taxes 6. The SWOT Analysis of the WPA SWOT Strengths: Weaknesses: Education to unskilled workers Started project didnt wanted Various types of jobs WPA as Financial â€Å"black hole† Provide part-time jobs Political influences Jobs for Artist and Black people and Women No ability to control the workers productivity Improve the health care system Opportunities : Threats: Starting more useful projects Instable economical environment Decreasing political aspects of the projects Living expenses increases, because import stop Strengthen the economy throughout projects Potential health problems, disease could stop projects Developing international export-import partnerships Other political parties critics-political intervention Support the banking act, provide more financial security The SWOT analysis is for compute the Strength, Weaknesses, Opportunities and Threats of a sector or a company (Mehta, S. (2000) Marketing Strategy). It is used for strategic planning to create a way to the desired goal or objective. In this case it was decided to apply this technique to set a real picture about the Second New Deal through WPA. The main aim of the current analysis is not generate alternative strategies, but to summarize the situation of WPA and the critiques in 1930s.Starting with the strength of the WPA it can be seen that the group of different types of jobs were provided to a high-scale target area. People could achieve different skills by the WPAs trainings and educations, and they got motivation to learn and use their knowledge in long-term. There were several weaknesses of the program from the beginning. As a governmental project the WPA needed a huge financial background to work and in some cases they only waste the money. The critiques described that some part of the program was only started to get more votes. The real leaders of the WPA had no ability to control the workers productivity and their effectiveness. To mention some real threats the instable economic environment remained the same. The diseases could spread faster among the workers and it may stop many constructing projects and it may indicate more financial problems in the health care system. One of the most important opportunities was to prevent more political fight and decrease the obvious political aspects of the projects. It would have been useful if they could solve the import problems. The following table above contains the main strength, weaknesses, opportunities and threats. 6.1. The external factor analysis EFAS (External Factor Analysis Summary) External Factors: Weight Ratings Weighted Score Opportunities: O1 Starting more projects 0,1 3 0,3 O2 Decreasing political aspects of the projects 0,2 4 0,8 O3 Strengthen the economy through projects 0,05 3 0,15 O4 Developing international export-import partnerships 0,1 2 0,2 O5 Support the banking act, provide more financial security 0,05 3 0,15 Threats: T1 Instable economical environment 0,2 4 0,8 T2 Living expenses increases, because import stop 0,1 3 0,3 T3 Potential health problems, disease could stop projects 0,05 2 0,1 T4 Other political parties critics-political intervention 0,15 3 0,45 Total Scores: 1 1,0-5,0 3,25 The SWOT table can be used to introduce three other type of analysis the EFAS, the IFAS and the SFAS. The External factor analysis and the internal factor analysis are calculated in a same way. The external factors (opportunities, threats) are used to show the economic background of the company or the sector. The elements of the SWOT table are the main factors of these tables. Every row contains weights and the rates and the multiplied result; the weighted score. The sum of every weight has to equal by 1, and the factors ratings should be between 1 and 5.The total score will be the sum of the weighted scores and it shows a real picture about the companys position. The company is in danger if the result is less 3,5 than. 6.2 The internal factor analysis IFAS(Internal Factor Analysis Summary ) Internal Factors: Weight Ratings Weighted Score Strenghts: Education to unskilled workers 0,15 3 0,45 Various types of jobs 0,15 4 0,6 Provide part-time jobs 0,1 3 0,3 Jobs for Artist and Black people and Women 0,2 2 0,4 Improve the health care system 0,1 3 0,3 Weaknesses: Started project didnt wanted 0,05 3 0,15 WPA as Financial â€Å"black hole† 0,05 2 0,1 Political influences 0,1 4 0,4 No ability to control the workers productivity 0,1 3 0,3 Total Scores: 1 1,0-5,0 3 If the result is more than 3,5, the company is in safe. The internal factors (Strengths, Weaknesses) are closely related to the object of the analysis. The internal strengths and weaknesses summarize the main topics the company has to deal with. The total score is 3 and this means that the company is not in safe and for a long -term basis the management has to handle the weaknesses to strengthen the company position in the market. SFAS(Strategic Factor Analysis Summary ) Factors: Weight Ratings Weighted Score Duration (in terms) S Strenghts: Short Medium Long S1 Education to unskilled workers 0,2 3 0,6 X S4 Jobs for Artist and Black people and Women 0,2 4 0,8 X W Weaknesses: W3 Political influences 0,15 4 0,6 X W4 No ability to control the workers productivity 0,1 2 0,2 X O Opportunities: O1 Starting more projects 0,05 5 0,25 X O2 Decreasing political aspects of the projects 0,05 1 0,05 X T Threats: T1 Instable economical environment 0,2 4 0,8 X T4 Other political parties critics-political intervention 0,05 3 0,15 X Total Scores: 1 1,0-5,0 3,45 6.3. The Strategic Factor Analysis Summary The Strategic Factor Analysis Summary (Business Policy and Strategy lecture SFAS power point presentation 2008.12.03) has an additional column, the duration that is separated into three different parts; long-term, medium-term, and short-term .The most important factors are listed here with weights and ratings to represent the main internal and external aspects of the WPA and to make a summary about the problems and possibilities. As a conclusion, based on the analysis listed below, the SFAS ‘s weighted score is 3,45.It means that the WPA could work in a long-term if the leadership could handle the problems. The WPA project stopped in 1944; therefore the main reasons did not connected to the internal factors, but only the externals. Some critiques had right the all the projects of WPA had only a political step to achieve more cotes in the elections. 7. The worlds reaction to the Great Depression (Theories) The world reacted in a several way to the Great depression and created a lot of theories how to solve the situation. The most famous reaction was the communism, fascism and the Keynesian theory. The fascism took place in Germany, Italy and it represented a highly centralized economy. The public construction programs provided jobs for unskilled labourers to built roads, work camps and military facilities. It increased the demography of the population, but the system was highly dictatorial. According to the statistics the unemployment rate decreased dramatically from 6 million to 0.2 million people.The Communism, as a highly bureaucratic and centralized system, was one of response to the Great Depression. It focused to fully employ the people in a strictly regulated obligatory way. The Keynesian theory: It states that the fully employment is needed, but only the intervention of the government can create this possibility. It can be long -term purpose of the existence of the government. The Keynesian theory changed the way of the thinking about the unemployment. The idea of the welfare state was another solution of the crisis. The education, the minimal guarantee of a job to every citizen is the basis of a welfare system. It guarantees the minimum wages and the minimum social and healthcare system. II. The Current Financial Crisis 1. The beginning of the Current Crisis The current financial crisis started in 2007, but it was not until the last quarter of 2008 .Firstly, this part of the thesis going to show how it all started, the causes and those who were affected by the crisis and how they are trying to deal with the crisis. Most of the people are pointing directly to real estate as the major cause of the current financial crisis even financial institutions that not directly involve with real estate are affected. It can be seen how the subprime mortgages and unscrupulous lenders has caused the unsustainable real estate bubble which began to collapse in 2006.There was increase in homeownership in the United State to about 5 million in little more than six years thanks to the increase in subprime lending. Within these six years constructions of new house sing units grew more but this housing bubble could not grow forever. In this period the price of house went so high and rent price went so low. When the price of housing began to decrease in the lat e 2006 to early 2007, many subprime borrowers had very hard time to make their payment. The housing bubble or the excesses of the subprime mortgage market became even more evident when subprime mortgage lender filed for bankruptcy. All the sectors like households, businesses (including financial institutions), and government are the main participants in the financial market and hit by the crisis. The secondly related financial groups are the surplus units provide funds and while the other group that enter the financial market to obtain fund are the deficit units. If market securities yield low returns why invest in it? Three factors can be seen to why it important to make investment in market securities these are, as we have said before the advantage to convert to cash rapidly so it can be substitute as cash. The second reason is that when a firm has excess cash let say for a month it can invest the excess cash in form of securities as not to hold too much cash in hand. The third reason is that when a firm know it going to pay a loan soon it gathers the money monthly to pay and this money could be invest in market securities before the loan is to be paid. As it have seen when the financial crisis started the public could see that the financial system is in a deep trouble some even call it recession because the stock market came crashing and lost almost 42% of it original price. Before the peak of the financial crisis the total world stock market worth $62.5 trillion and now it $36.6 trillion so it lost $25.9 trillion. Let compare the stock market of leading countries of one day and another day and see how it doing. STOCK MARKETS May 5 prev %chg SP 500 903.8 907.24 -0.38 Nasdaq Comp 1754.12 1763.56 -0.54 Dow Jones Ind 8410.65 8426.74 -0.19 FTSEurofirst 300 846.81 842.7 +0.49 DJ Euro Stoxx 50 2407.55 2419.53 -0.50 FTSE 100 4336.94 4243.22 +2.21 FTSE All-Share UK 2226.6 2174.64 +2.39 CAC 40 3225.0 3237.97 -0.40 Xetra Dax 4853.03 4902.45 -1.01 Nikkei (c) 8977.37 Hang Seng 16430.08 16381.05 +0.30 FTSE All World $ 153.46 153.19 +0.18 ( source New York Times May 5 2008) There was turmoil in the all over the international financial system due to the losses in the subprime mortgage in the mid-2007.This was wide spread global crisis even thus firm not associated with the mortgage firm. This made the financial institutions very nervous and the stock market got very weak. Between July 2007 and March 2008, there was a significantly drop in the price of shares in the large, small and investment bank. A