Globalization Of The Marketplace Has Brought About Costs...

Regionalism Briefing Introduction The globalization of the marketplace has brought about costs and benefits for all countries and industries. A main benefit of globalization for producers, like the those of us in the manufacturing industry is access to more customers however, competition also increases which decreases the potential for sales. Economic integrations are a part of global business that look to increase the efficiency of resources. Economic integrations and trading blocs are instituted in order to remove barriers to trade. The idea is that by removing barriers each individual economy will be able to utilize their own resources and those of others with more with more efficiency (Hill, 2013, p. 256). The result is that a common†¦show more content†¦Free Trade Area A free trade area is the lest integrated form of economic integration - â€Å"all barriers to the trade of goods and services are removed† but members still has the ability to set their own rules when trading outside of the bloc ( Hill, 2013, p. 257). The North American Free Trade Agreement (NAFTA) is the most recognizable free trade area (Hill, 2013, p.257-258). The major argument against free trade areas is that jobs which can be done for less are moved to other countries (Ho, 2016). In order to provide the congressional committee with an overview of the impact free trade areas have had on the US manufacturing industry this text will focus on NAFTA’s impact. NAFTA NAFTA is a free trade agreement between the US, Mexico and Canada that was implemented in 1994 (Childress, 2012, p. 23). Barriers to trade were removed in order to encourage trade between the countries (Childress, 2012, p.23). This allowed each country to focus on producing goods and services that their own local factors of production allow them to do most efficiently and trade for those which can be produced for less and of higher quality in other countries. â€Å"The U.S. lost roughly 800,000 jobs to Mexico between 1997 and 2013† NAFTA wa â€Å"the key driver for job losses† (Lunby,2016). Many US manufacturing companies moved production to Mexico where labor is cheaper as labor is the highest direct cost associated with manufacturing,

The Community College System An Alternative Form Of...

The Community College system in America is an alternative form of schooling so the student can get out into the workforce quicker than a student could while attending a four-year university. Over the years, the junior college system has progressed to become more intimate within the communities they serve. Whether the student is an older person wanting to learn a new trade, or a young adult trying to figure out what their purpose is in life, the community college is a good place to start. One question some people ask is, â€Å"Will the education be the same across the board even with the drastic difference in the cost of tuition?† Many people are hesitant about the cost of a four-year university, but likewise, they are also concerned whether†¦show more content†¦After the Great Depression, the junior colleges quickly rebranded their names to community colleges to show dedication to helping the citizens of the specific communities (Trainor). The open-doors admission pol icy was established by the World War II, and Korean War veterans wanting to go back to school to learn a new skill (Trainor). In today’s era, community colleges can provide students with online classroom platforms, distance-learning and study abroad opportunities, and a creative approach to helping struggling students via virtual/live tutors. Community colleges are very diverse in regards to the admissions process. In a public university setting, most students will have high student loan debt, and the admissions counsel will be more discriminative toward applicants. Many people are reluctant to apply to community colleges because they believe that they cannot obtain a certification or degree that could financially sustain themselves. In January 2015, former president Barack Obama proposed an idea titled â€Å"American College Promise† which would guarantee free college education to everyone who is willing to put forth the effort for the first two years of their post-se condary education (Trainor). This program would help jumpstart the workforce by providing moreShow MoreRelatedThe Pros And Cons Of Homeschooling1331 Words   |  6 PagesReasonable AlternativeHomeschooling is becoming an increasingly attractive alternative to other forms of schooling such as at public or private schools. homeschooling does seem to gain opponents from time to time and they might have good points. However, this movement has rendered satisfactory results and should continue to be legal and should be respected and aided by educators and the legal system. 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Since Barack Obama first mentioned the idea in 2015, conflicts of interest have arisen surrounding the debate. Many people think that free state college education would enable more Americans to receive and then use an education at a higher level than in years past. Other argue that there will be many disadvantages to free state college educatio n that would far outweigh the benefits. Providing free state college education to all American citizensRead More Homeschooling: A Way for All Children to Succeed Essay2822 Words   |  12 Pages Homeschooling has been the major form of education for thousands of years, but throughout the past several decades, there has been a significant alteration in the main method of schooling. What is now referred to as â€Å"traditional schooling† is the accepted method of having dozens of children in a public or private school setting for 6-8 hours, and coming home to an overload of extracurricular activities, as well as a surplus of homework. 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Financial Crises and Corporate Finance Causes, Context and Consequences Free Essays

string(117) " gold plate the deal by providing a credit default guarantee for the SPV in the event of default \(Teasdale, 2003\)\." 1.0 Introduction – background to financial crash of 2007-8 This essay will examine the background and unfolding of the 2007-2008 financial crisis and its impact on the theory and practice of corporate finance. I will analyse whether changes to the way the financial and non-financial corporate sector operated over recent years contributed to the depth and severity of the crisis. We will write a custom essay sample on Financial Crises and Corporate Finance: Causes, Context and Consequences or any similar topic only for you Order Now Specifically, financial deregulation in the 1990s in financial markets and the securitisation of the corporate sector (Ball, 2009), have led to claims that the ‘solution’ to the so-called agency problem of aligning manager and shareholder interests may have actually made the crisis worse. I will argue that the easing of regulations on the mortgage loan sector especially increased the risks of a financial crisis developing by creating the environment for a massive financial asset bubble. Historically low interest rates and ‘easy money’ policies of the US Federal Reserve under Alan Greenspan following the bursting of the technology bubble in 2000 created conditions for the bubble. I will also examine whether the growth in markets for innovative financial products such as CDOs disguised risks and even mispriced assets in the mortgage market by separating the obligation to fund the original loans from the trading of such obligations as collateralised debt. The outcome of the crisis in terms of future corporate financial behaviour and regulatory reforms of the corporate sector will be reviewed. 2.0 Corporate finance models and the financial crisis – the role of CSR Critics of the corporate sector such as Simms have argued that the narrow focus among publicly listed companies on short-term profits over and above sustainable long-term corporate health, helped cause the financial crisis of 2007-9. The process of selling off traditionally run companies to global multinationals had led to the disappearance of famous companies such as Twinings and Cadbury from the British economy, and the loss of jobs related to these closures. Simms is not alone in claiming that the narrow pursuit of short-term profits as well as excessive pay among senior executives has not served the interests of the wider economy and stakeholders including workers and pension funds. Simms sees the selling off and closure of great British enterprises as the result of the loss of traditional family business ethics and their replacement by financial sector values of high returns to investors. Fernandez-Feijoo Souto (2009) analyses the financial crisis in terms of the opportunities it presents for companies to refocus on corporate social responsibility. CSR is seen as growing in importance as part of the corporate culture although there is difficulty in defining what CSR actually means. Fernandez-Feijoo Souto argues that the financial crisis has provided a new urgency to the need to clarify what defines CSR and how it should be implemented. This includes building a name as a responsible business and relating this to growing revenue, keeping key personnel, understanding consumer’s bias toward companies with a good CSR brand; changing relationships through the value chain based on trust and treating customers and suppliers well; improving conditions which in turn reduce employee turnover and raise productivity, and reducing legal conflicts by complying with regulations. Simms argues that companies with a business model that has CSR built into it have been shown to be much better adapted to survive the challenges of the global financial crisis than companies that have followed a short-term profit strategy. He uses the examples of Bear Sterns and Lehmans, which traded under the saying â€Å"Let’s make nothing but money,† as classic examples of the kind of approach that led to disaster. However for each such example, one can point to a similar company, such as Barclays or Goldman Sachs, that have continued to thrive during the financial crisis despite having the same financial focused ethos. This is reflected in the evidence of numerous studies the result of which show unproven links between CSR and cost, profit and longevity (Fernandez-Feijoo Souto, 2009). There is evidence also of a split between positive economic results and more negative financial results, meaning that potentially short term financial gains may come at the cost of longer term economic performance. Lipton, Lorsch and Mirvis (2009) state: â€Å"Excessive stockholder power is precisely what caused the short-term fixation that led to the current financial crisis.† They point to money managers focused on short-term financial results who fuelled excessive risk taking. This tendency was favoured by government and regulators failing to impose checks on risk taking. Lipton, Lorsch and Mirvis see a â€Å"direct causal relationship between the financial meltdown and the short-term focus† of stockholders. 3.0 The role of securitisation in the financial crisis Securitisation of the mortgage and loan market, which developed in the 1990s, is seen by some commentators as central to the development of the financial crisis of 2007-8. Securitisation of asset-backed bonds is the process of creating debt instruments from a package of loan assets, usually home loans, commercial loans and retail loans such as credit card debt or auto loans. This allows banks to release value from the assets on their balance sheet. The asset-backed market was developed in the United States and grew rapidly from the early 2000s. Banks and other originators of mortgages sold on packages of their loans to an issuer, usually called a special purpose vehicle (SPV). The purpose of the securitisation is to reduce the institution’s balance sheet, which allows its return on equity to rise and also releases capital for other purposes. The process of securitisation enables the issuer to achieve enhanced credit ratings, usually up to AAA investment grade (Sundaresan, 1997 ). The credit rating of the original loan does not affect the rating of the SPV, even if the original mortgage holder defaults on the loan or is declared bankrupt. The securitisation deals are normally rated by credit ratings agencies such as Moody’s, Fitch or Standard Poor’s. The investment bank or investor which purchases the SPV securities will often approach an insurer to gold plate the deal by providing a credit default guarantee for the SPV in the event of default (Teasdale, 2003). You read "Financial Crises and Corporate Finance: Causes, Context and Consequences" in category "Essay examples" It has been argued that the complexity of securitisation restricts the ability of investors to assess risk, and that securitisation markets are likely to be subject to serious declines in underwriting standards. 3.1 Credit Default Swaps – analysis of impact of CDS market in the financial crisis The huge growth of the credit default swap (CDS) market is considered by many analysts to be one the worst elements of securitisation. The Bank for International Settlements reports that the CDS market increased in size from $6 trillion in 2004 to $57 trillion in June 2008 measured by notional principal (Stulz, 2010). The government bailout of AIG brought the CDS market to global attention, and led some commentators to see the CDS market as the primary cause of the financial crisis. As Stulz (2010) argues, there are two problems with the CDS market. First, the sellers of credit default swaps are not able to bear the risks they took on, so some of the benefit of credit default swaps in terms of hedging are actually unfounded – ultimately leading to the $80 billion bailout of AIG. Second, because of their inherent leverage of a CDS, they can enable investors to take more risky positions. The availability of these instruments to non-risk-averse investors may lead to risk being un der-priced. However, Stultz shows how the CDS market performed remarkably well around the default of Lehman Brothers. The credit default swap market did not cause the subprime mortgage defaults or the disappearance of liquidity. Excessive leverage by financial institutions and the collapse of the housing market was the cause of the crisis. For example, AIG borrowed heavily to acquire home loan-backed securities and it made even bigger losses on its portfolio of home loan-related securities than on its credit default assets. 4.0 Ponzi schemes and failure of investment banks to report criminal behaviour The crisis also revealed outright criminal activity taking place in the investment sector, most famously in the case of Bernard Madoff, whose wealth management business was exposed as a Ponzi scheme with $65 billion funds missing from accounts. Madoff was sent to prison for 150 years. JP Morgan acted as banker to Madoff but did not report their suspicions about his activities to the SEC (Ferguson, 2012). Critics have commented that there have been very few prosecutions of investment bankers for such activities as ‘shorting’ the very stocks that they recommended to their clients (Lewis, 2010). The Securities and Exchange Commission and New York prosecutors have brought very few prosecutions and no one has faced criminal conviction. Ferguson points out that Morgan Stanley’s Howie Hubler began to bet against securities connected to the subprime market in 2004 with management approval (Ferguson, 2012). The title of Ferguson’s film ‘Inside Job’ ref ers to the pattern of investment bankers and lawyers whose clients are banks then taking senior judicial and political roles in the government and financial authorities. This, it is argued, has caused a disincentive to go after the banks for actions that could be prosecuted. 5.0 Reform of corporate finance regulations – legislation and limits of reform Reform of the banking and wider corporate sector has been discussed and enacted in a variety of forms in the US and Europe. Banks have undergone stress tests to see if they could cope with further financial crises. The UK authorities have begun to reform corporate governance to give shareholders greater power to oversee compensation of executives, such as binding votes on executive pay, but this has not yet been implemented. New rules on the levels of reserves that banks must hold in order to ensure they are able to cope with future crises were agreed in November 2010 at the G20 summit in Seoul. G20 Finance Ministers backed the Basel Committee on Banking Supervision’s plans for capital and liquidity requirements for financial institutions. However most of these new reserve requirements have not yet been enforced, partly because the banking sector remains extremely fragile following the financial crash with high level of debts still threatening the financial system. Following t he crisis, there were many calls for the separation of retail and investment banking, or even the breaking up of ‘too big to fail’ banks, but these have not been acted on by government. President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act into law in July 2010. The Act marks the biggest reform of the US financial sector since the Great Depression (Avery, 2011). Section 939A of the Act effectively bans the use of credit rating agencies in an attempt to improve capital requirements for US banks. However implementation is likely to take many years. In America economists such as Paul Krugman have called for a return of the Glass Steagall Act 1933, which was put in place following the 1929 Wall Street Crash and then removed in the 1990s as part of the liberalisation of the banking sector (Krugman, 2011). Countries with stronger regulation of their banking sector, including Canada, Australia and Germany, did not suffer a banking crisis in the manner of the UK and USA, where regulation was ‘light’. 6.0 Conclusion: comparison with regulatory response to 1929 Financial Crash By comparison with the response of authorities to the Great Crash of 1929, it can be argued that through to 2012, five years after the crisis began, major reforms to the banking sector and to corporate governance in the US and UK have not been implemented in the way they were in the 1930s. This may be a result of the fact that governments and securities oversight authorities are far less independent of the corporate finance sector than they were in the 1930s. The financial services sector has grown in relation to GDP compared to its position in the 1930s, and its political influence is far greater. This means that reform and regulation has been much slower and weaker than it was in the last Great Depression. Calls for reform will not go away, especially as the crisis continues in Europe and North America. Action on corporate governance, and implementation of proposals for financial and banking reform will be required in order to prevent further financial crises occurring in the futur e. REFERENCES Avery, A. W.; 2011. Basel III v Dodd-Frank: What Does it Mean for US Banks, Who’s Who Legal. Ball, A. 2009. The Global Financial Crisis and the Efficient Market Hypothesis: What Have We LearnedThe University of Chicago Booth School of Business, Journal of Applied Corporate Finance, Volume 21, Issue 4, pages 8–16, Fall 2009 Ferguson, C; 2012, Heist of the century: Wall Street’s role in the financial crisis, The Guardian, 20 May 2012. http://www.guardian.co.uk/business/2012/may/20/wall-street-role-financial-crisis Fernandez-Feijoo Souto, B.; 2009. Crisis and Corporate Social Responsibility: Threat or OpportunityInternational Journal of Economic Sciences and Applied Research, Vol. 2, No. 1, 2009. International Corporate Governance Network (ICGN), 2008, Statement on the Global Financial Crisis. Krugman, P and Wells, R., 2011, The Busts Keep Getting Bigger: WhyNew York Review of Books,14 July 2011 Lewis, M. 2010, The Big Short, Allen Lane, Penguin. Lipton, M; , Lorsch, J. W. and Mirvis, T.N, Schumer’s Shareholders Bill Misses the Mark, Wall St. Journal, 12 May, 2009 Mirvis, Wachtell, Lipton, Rosen Katz, 2010. Corporate Governance and the Financial Crisis: Causes and Cures, February 28, Harvard Law School Forum on Corporate Governance and Financial Regulation. Sims, A; 2010. The power of corporate finance is an amoral hazard, The Guardian, 8th September, 2010. http://www.guardian.co.uk/commentisfree/cifamerica/2010/sep/08/power-corporate-finance-amoral-hazard Stulz, R.M., 2010, Credit Default Swaps and the Credit Crisis, Journal of Economic Perspectives, Vol. 24, No. 1: 73-92. Sundaresan, S., Fixed Income Markets and Their Derivatives, South-Western Publishing, 1997, chapter 9. Teasdale, A; 2003, The Process of Securitisation. YieldCurve.comhttp://www.yieldcurve.com/Mktresearch/files/Teasdale_SecuritisationJan03.pdf How to cite Financial Crises and Corporate Finance: Causes, Context and Consequences, Essay examples

Mommas Encounter Critique free essay sample

How momma was strong to not let the plethoras kids (as she called them) made her feel Inferior. Angelo understood why momma was so strict, It was a method of Implying deadlines and form a character full of manners and values. In the momma s encounter the morals, values, etc. Where Important. Did you think Angelo liked when those white kids insult a said horrible thing to momma? Noel But momma raised her to be discipline and she had to respect her decision to do nothing.Which was a very good strategy, because what is a person going to do if she/ he attacks you and you do nothing. Well, nothing is going to get tired and eventually live you alone. That s what happen with momma. Once I was walking to school and here girls yelling me hey fat girl and I Just ignored them like if no one was there and you know what? It worked they got tired and shut their mouth. We will write a custom essay sample on Mommas Encounter Critique or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page For a second I was like momma. Did I was?Maybe, I did not yelled back I was respectful something that those girls do not have. In conclusion, momma was a great and brave woman with her failures like every woman being, but she did a great Job educating Maya Angelo and her sisters. This an example how to win without giving or being on a battle, of how you can try to handle a difficult situation of abuse any situation of this case. Momma s encounter an Inspiration and admiration tome.