Causes of the Financial Crisis in the US

Causes of the Financial Crisis in the US INTERNATIONAL BUSINESS During the later half of the 20th century U.S economy was the most powerful economy in the world, they set the rules for rest of the world. They established multinational corporations all over the world which was indeed the heart of world economy. (Davis, 2009). When the U.S economy was rising, all the other countries economy were also growing, at the same time when their economy went down it affected almost all the other importing and exporting countries in the world because of the recent crises which was named as â€Å"GLOBAL FINANCIAL CRISIS†. This was meant to be the biggest crises after â€Å"THE GREAT DEPRESSION 1930† (Cambridge Journal of Economics, 2009). The crises have already recorded loss of over $150 billion and large number of banking institutions have declared bankruptcy or being sold.(Kregel, 2008) One among the banks filed for bankruptcy was Lehman Brothers, which was Fourth largest investment bank in U.S. (BBC, 2009). Therefore it is important to ident ify causes of current financial crises and resolution measures. Secondly, UK government should take effective steps in order to reduce danger of further crises (Turner, 2009) During later part of the 19th century that is 1973 Daniel bell published a book titled â€Å"THE COMING OF POST INDUSTRIAL SOCIETY†. The book was about forecasting to find the changes in economy and society in united state. One of the most visible changes according to him was the work force shifting from manufacturing and agriculture to service based industry which he named as â€Å"POST-INDUSTRIAL SOCIETY†. The author was right in his prediction because today only 10% of the total labour force is employed in agriculture and manufacturing industry. Between the period December 2000 and May 2009 US lost more than 5.25 million employees in manufacturing sector. There were many problems in durable goods industry, particularly in auto manufacturing industry. Two or more companies in that sector declared bankruptcy which stated that there was lot more bad news to come. Comparatively, manufacturing jobs were long lasting on an average of 8 years compared to an average of 3 yea rs in service industry. The shift was driven by Wal-Mart. The firm employed about 1.4 million employees in 2009 which was more than that of 20 largest American manufacturing companies together. This caused changes to occur in pension financing and people started investing in mutual funds. This happened through change in pension financial that took over small amount to mutual fund from large amount of investment savings. This created pressure for high returns and also takes away the option of staying with a single firm. This enabled growth of institutional investors. Huge amount of portable pension funds were managed by banks, mutual funds and insurance firms. Nearly 1000 corporation shares were owned by institutional investors in 2005, with mutual fund taking maximum of 10% or more in hundreds of corporations. For manufacturers the main focus was on share value which spread OME model (Original equipment manufacturer) which means the production is out sourced to other external organizations. Other than manufacturers, functions such as HR and IT etc were also outsourced. This slowly made drastic changes in traditional corporation where it became empty. They were concerned mai nly about turning the out-sourced products into branded commodities. This shows that the stock market existed only for intangible assets. (Davis, 2009) Now we shall discuss about the causes of the Global financial crisis: One of the main reasons for the crises was the housing bubble. A housing bubble is an economies bubble that occurs in local or international market. The recent financial crises started eventually in 2001 with the busting of U.S housing bubble and reached its peak in 2005.Basically it is said when there is a rapid increase in real estate prises until it touches its peak and reaches unsustainable level. The bubble in the houses was identified in 2006 after the market correction. Former chairman of Federal Reserve Board, Alan Greenspan said in 2007 that they had bubble in housing but it was very late until they realized in 2005 and 2006 (Bianco, 2008) Many economists believe that the main reason behind housing bubble was caused by low interest rate set up by the Federal bank. The interest rates were reduced to 1% from 6.5%, this made people to mortgage their property against the loan. The banks in return encouraged everyone to obtain loan against their mortgages because real estate prices were at its peak. [business.cch.com] When inflation began in 2004, US federal withdrew monetary accommodation, they started increasing the interest rate and mortgages payment also started rising apparently. Tight money policy came into play and there was a great demand of money and therefore house prices fell. Banks and other financial institutions financed at very low rate, and when interest rates started raising there were heavy chance of default by the subprime borrowers thus default by such borrowers led to losses. Though the loans were secured and were sold to special institutional vehicles (SIVs) the losses were still bourn by banks and oth er institutions (Mohan, 2009) Deregulation of financial system gave rise to tradable instruments through securitization. Securitization means turning an asset or credit card debt into tradable instrument. This system made household to become both investors and issuers of securities. Thus trading in different form of capital emerged which was unstable and did not last for long which caused the financial crises (Davis, 2009). Apparently US government failed to manage their trade deficit. The housing bubble was mainly caused by cheap credit and low interest rate rates. The main reason for cheap credit was there was a lot Chinese capital in U.S. And that is because US imports most of the products from china and sells it at a cheap rate to its consumers (Weismann, 2008) Global Macro Economy Imbalance: According to Portes (2009) global macro economy was one of the major underlying reasons of the financial crises. This is because of saving investments and huge cross border capital flow made a lot of pressure on financial intermediation process, these imbalances with flaw in the financial market and instrument together became one of the specific features of crises (Mohan, 2009). In view of the current crisis, the UK Government can initiate the following actions to prevent another crisis: Looking at the long term , we think of what should be done in order to avoid danger of future crises, it is clear that macro economy imbalance was one of the major underlying reason, so it is better UK government try to find the problems which lie at the interface between macro economy policy and financial system regulation. Few more things that government should consider are they should make sure that they protect the needs of ordinary people when the information is costly to acquire. Next measure is the government should make sure that internalises significant externalities. This is in contrast to the currency regulatory frame work which does not focus on externalities and it also provides incentives for the institutions to become very large to fail or too interconnected to fail, because the larger the institution the more interconnected and higher the risk of escaping during crises.( Brunnermeier, 2009) The government should also focus on systematic risk contribution because during the financial crises losses tend to spread over other financial institutions also. The government should try to form a regulation that reduces the risk of spreading over the losses to financial institutions. A financial contribution to systematic risk can be large because of its correlation with financial difficulties among the other institutes or causes financial difficulties at other institutes. Therefore new measures should be taken to reduce the risk of both the channels. (Brunnermeier, 2009) According to Turner (2009), liquidity management and new regulations help to minimize liquidity risk. The future rules and regulations should be monitored effectively (Turner, 2009). Asset price booms can be regulated by implementing strict fiscal and monetary policies. These policies should take into consideration price stabilization and macro-financial stability. There has to be effective co-ordination between domestic and international policies. The UK Government should try to stabilize all the financial institutions that hold illiquid assets. The regulators have to combine macro-prudential and macro economic analysis by using sectoral analysis (Turner 2009). REFERENCES: Brunnermeier, M.K., (2009) Financial Crisis: Mechanisms, Prevention and Management [Online] Princeton University. Available at: http://66.102.9.132/search?q=cache:2lGCaBp37xYJ:fmg.lse.ac.uk/upload_file/1197_BrunnermeierPaper.pdf+http://fmg.lse.ac.uk/upload_file/1197_BrunnermeierPaper.pdfcd=1hl=enct=clnkgl=uk [accessed 28 February 2010] BBC., (2009) Timeline: Credit Crunch to Downturn [Online] Available at: http://news.bbc.co.uk/1/hi/7521250.stm [accessed 28 February 2010] Bianco, K.M., (2008) The Subprime Lending Crisis: Causes and Effects of the Mortgage Meltdown [Online] CCH Mortgage Compliance Guide and Bank Digest. Available at: http://docs.google.com/viewer?a=vq=cache:Vf9c_0SfRl4J:business.cch.com/bankingfinance/focus/news/Subprime_WP_rev.pdf+http://business.cch.com/bankingfinance/focus/news/Subprime_WP_rev.pdfhl=engl=ukpid=blsrcid=ADGEESj5j4t_00aCZcSuhO6_qF6EZO99uP_P34gAGd2f_A7I_C2MVjlkbSVcFqc6FpAPGyYECW5sPQG6k_k4ja-tXrsL2EsZd8alQZk0U9n7Esqh31V1F9pwowYc1IeTo-U3I5vHAR9Ksig=AHIEtbT1hFiNcXHdS3Y4lgV7AYIRF1xY4g [accessed 28 February 2010] Crotty, J., (2008) Structural Causes of the Global Financial Crisis: A Critical Assessmentof the ‘New Financial Architecture [Online] PERI Political Economy Research Institute, University of Massachusetts Amherst. Available at: http://cje.oxfordjournals.org/cgi/content/abstract/33/4/563 [accessed 28 February 2010] Davis, G.F., (2009) The Rise and Fall of Finance and the End of the Society of Organizations [Online] Available at: http://docs.google.com/viewer?a=vq=cache:ZorkG-ZL1xoJ:webuser.bus.umich.edu/gfdavis/davis_09_AMP.pdf+http://webuser.bus.umich.edu/gfdavis/davis_09_AMP.pdfhl=engl=ukpid=blsrcid=ADGEESjziDXUPSnMjim8GZyAz8aK9YRHi-xpS8SYDDv3l4gtQ9hV0ahiOz8oXWhb9zGr-HAAkRmaRdH34zQJuaoZpLyEv_QopXWxlCvjM7CuFPsiWbmUdqY-b-hZ1KQL4The1skEpDsig=AHIEtbSoJoJuRiAosw1OGQqy3G2BrQEutg [accessed 28 February 2010] Mohan, R., (2009) Global Financial Crisis- Causes, Impact, Policy responses and Lessons[Online] Annual India Business Forum Conference, London Business School. Available at: http://www.bis.org/review/r090506d.pdf [accessed 28 February 2010] Turner, A., (2009) The Financial Crisis and the Future of Financial Regulation [Online] The Economists Inaugural City Lecture, Financial Services Authority. Available at: http://www.fsa.gov.uk/pages/Library/Communication/Speeches/2009/0121_at.shtml [accessed 28 February 2010] Weissman, R., (2008) Deregulation and Financial Crisis [Online] The Huffington Post. Available at: http://www.huffingtonpost.com/robert-weissman/deregulation-and-the-fina_b_82639.html [accessed 28 February 2010]

Problems In Health Economy And Food Chains Environmental Sciences Essay

In recent decennaries increasing attending has been paid to the environmental jobs and protection. The study conducted by Bureau of Meteorology in Australia provinces that the average temperature in the universe has increased by 2AÂ ° Celsius ; the warmer temperature increased the sea degree and endanger the environment ( 2010 cyberspace ) . It is noticed that the environmental jobs chiefly caused by human activities such as firing fossil fuels, fuel fumes from autos and alterations in land usage such as deforestation. Harmonizing to OECD, environmental protection refers to activities to stay or retrieve the quality of the environment through forestalling the emanation of pollutants ( 2003, Internet ) . It is believed that people should contend for environmental protection which means utilizing different methods to endeavor to get the better of the jobs and protect the environment. Environmental protection is deserving contending for as it can assist to cut down wellness jobs, stabl e the economic system and keep a healthy nutrient concatenation rhythm. The undermentioned essay will split into three facets, wellness, economic system and the rhythm of nutrient concatenation and explicate how the current environmental jobs affect these facets. Harmonizing to those three facets, the essay will besides explicate the ground of environmental protection is deserving to contend for. First, environmental job such as air pollution is going an progressively greater hazard to wellness ; therefore environmental protection is needed in order to protect the human wellness. The research from the Clean Air Healthy Communities states that air pollution can be caused by growing of population which may hike the petrochemical smog and auto emanation and impact the air quality ( twelvemonth unknown, cyberspace ) . It is believed that hapless air quality may take to respiratory unwellnesss such as asthma and allergic reactions. Zwillich states that by protecting the environment, the emanation of air pollutants can be reduced, respiratory unwellnesss can besides be decreased at the same clip ( 2009, cyberspace ) . Since protection can cut down the sum of take a breathing pollutants, hence environmental protection is deserving to contend for so as to take down the hazard of holding respiratory unwellnesss. Furthermore, Robins references that hapless air quality in Sydney potenti ally exposes more people to ozone concentrations and leads to wellness job such as skin malignant neoplastic disease ( 2010, 2 ) . Harmonizing to Department of Health and Ageing, Australia has the highest rate of tegument malignant neoplastic disease in the universe. In mundane, there are over 1000 Aussies are suffered from skin malignant neoplastic disease and approximative two in three Australians will be diagnosed with skin malignant neoplastic disease before 70 ( 2008, Internet ) . Since environmental jobs may take to a figure of wellness jobs such as asthma, allergic reactions and even skin malignant neoplastic disease. Therefore, environmental protection is deserving to contend for as it can take down the hazard of holding those diseases and besides help people to keep a healthy life. Furthermore, the jobs in the current environment may besides impact the economic system of the state, therefore environmental protection is importance to contend for with the intent of better brace the economic system. Harmonizing to Gilpin, the accretion of the nursery gases in the ambiance can do planetary clime alteration, hence affect the life environment and even impact the economic system of a state ( 2000 ) . Tourism is one of the major sectors in the state ‘s economic system. It is believed that touristry is closely linked to biodiversity and the attractive force created by the environment. The clime alteration may take to loss of attractive force which means loss of touristry potency and hence affect the economic conditions. Furthermore, clime alteration will increase the opportunity of utmost conditions like hurricanes and typhoons. For illustration, Hurricane Mitch in 1998 was the stronger Atlantic Hurricane ; the powerful hurricane to a great extent affected tourist ry and accordingly besides affects the economic system in Caribbean ( Global Development Research Centre, twelvemonth unknown, cyberspace ) . Furthermore, it is believed that clime alteration may besides impact the agricultural and unrecorded stock production, therefore generate negative impacts to the economic system and environmental protection should be implemented. Wang, Huang & A ; Rozelle province that grain and rice production in China will fall due to the heater conditions. Besides, continued alteration in temperature will diminish the production of farm animal. For illustration, the production of beef is predicted to cut down 9.8 per centum by 2030 ( 2010, Internet ) . Climate alteration may take to loss of attractive force, affect the agricultural sector and these corporate results may impact the state ‘s economic system. Harmonizing to Raicola, environmental protection could decelerate the emanation of nursery gases and finally brace the degree of such gases stay in the ambiance and hence aid to command the clime alteration job ( 2007, cyberspace ) . It is believed that environmental protection is deserving to endeavor to implement in order to better protect the touristry and agricultural sector and accordingly brace the economic system. In add-on, lifting ocean sourness and the frequent fluctuation of conditions will impact the nutrient concatenation rhythm from underside to exceed ; the perturbation of nutrient concatenation may jeopardize the life of animate beings therefore environmental protection should endeavor to set into pattern in order to stabilise the nutrient concatenation rhythm. Increasing ocean sourness due to human emanations of C dioxide could impact the nutrient concatenation. As seas grow more acidic, extra C dioxide from the ambiance is less able to be absorbed. This will endanger the life of animate beings such as shellfish, plankton, corals and besides affect the critical nexus of nutrient concatenation ( Greenbang, 2009, cyberspace ) . In the Arctic, polar bears eat seals, seals eat codfish and codfish eat plankton. Hamilton states that animate beings in the Arctic nutrient concatenation depend on the peculiar clime of the Arctic. If rising temperatures affect one portion of the nutrient conca tenation, the full Marine ecosystem may besides be affected ( 2009, cyberspace ) . It is believed that the perturbation of nutrient concatenation will take to animate beings ‘ extinction, if the current tendency of emanation carries on, all ice dependent animate beings will necessitate to get by with a inexorable hereafter. It is certain that the dual hazard state of affairs, warming and souring oceans will impact the rhythm of nutrient concatenation ; hence the environmental protection is truly deserving to contend for in order to assist to stabilise the rhythm. By protecting the environment, the negative impacts caused by clime alteration could be relieved, it may diminish the hazard of carnal extinction and besides maintain a healthy nutrient concatenation rhythm at the same clip. In decision, recent human activities cause different environmental jobs such as air pollution, planetary heating and clime alteration. It is believed that environmental jobs have deductions on the wellness, economic system, every bit good as the nutrient concatenation rhythm ; therefore environmental protection is deserving to contend for in order to better header with the jobs. In the wellness facet, environmental jobs may take to different diseases like respiratory unwellnesss and skin malignant neoplastic disease ; therefore environmental protection is deserving to contend for so as to take down the hazard of holding those diseases. Furthermore, environmental jobs may besides interrupt the economic system such as affect the touristry sector and the agricultural production. It is certain that environmental protection should endeavor to implement with the purpose of better brace the economic system of the state. Furthermore, clime alteration upset the nutrient concatenation rhythm a nd leads to animal extinction. Therefore, environmental protection is besides deserving to contend for with the intent of maintain the critical nexus of the nutrient concatenation. It is believed that protecting the environment can assist the state to get by with wellness and economic jobs and besides the perturbation of nutrient concatenation, therefore environmental protection is deserving to contend for in order to better trade with these issues.

The Definitive Solution for Self Reflection Essay Samples You Can Learn About Today

The Definitive Solution for Self Reflection Essay Samples You Can Learn About Today Finally, you must make certain you add a great deal of supporting details to pull off a prosperous reflective essay. It is likewise very beneficial to depart from your readers something to consider after reading your essay. What you are going to be writing on your reflective essay is something which is rooted from your very own personal experience or encounter of something. Self-reflective essays may challenge you to think critically about what you're doing well and what has to be changed as a consequence of the experience you're writing about. Job analysis and selecting the most suitable people for your business is vital, and every circumstance is unique. The selection in an organization is very valuable, since there is people in the business you are around working with that needs your wisdom and personality. Furthermore, having hired employees, you need to train them should you expect them to operate effectively. In doing work analysis, you're essentially gathering information concerning the jobs in your business. HRM professionals also develop people to make sure that they possess the wisdom and the essential skills to be effective employees. You only have to share an experience. The very best thing you can do while training is to make the sort of environment in which employees aren't scared to ask questions. For instance, you can speak about the way in which the wisdom and experiences you gained will be helpful in future classes, jobs, relationships and other facets of your life. You've got to introduce your readers about which epiphany moment you're likely to speak about the essay and the way it affected your life. Definitely, the solution is same for everyone that's the title of the book. On the flip side, your reply to the question may prove to be too short for a whole essay. The Upside to Self Reflection Essay Samples Reflection is a significant part of learning. Self reflection is a significant practice. More to the point, however, you would like to make sure a conclusion that returns to the principal point. There are struggles that may easily be eliminated when you're in the early phases of writing your personal narrative essay. In case the latter description illustrates you here is a more in depth reflective essay outline which should get you where you have to be to put on a firm understanding of the way to compose a reflection paper. In the event you still unable to locate an appropriate direction that the best way to start it. The main aim is to dig deeper and get to the correct arguments in the topic for a simple method to write. Team work was definitely one of the absolute most important sides of our undertaking. My team was the very first to present the presentation, so we had to concentrate on the appropriate management of time to finish the work punctually. To turn into a great leader one must be fit for a particular organization or a particular job. There's no limit of the topics in the event of a reflective essay. There's no ideal solution on the best way to compose an effective essay. Be aware that samples may be used for your reference needs only. A good example is the current worldwide warming crisis. Poverty also impacts the environment. It is one of the main social problems in the world. The detail is key once you construct your conclusion. Back on reflective essay help you need to reflect. Basically, the sections of an essay proved just 3 divisions. How you organize your essay is based on the outline.

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