Comparing How Various Anthropologists Discovered Anthropology as a Care

Comparing How Various Anthropologists Discovered Anthropology as a Career Anthropologists have reasons for entering a field of work just like any other person has reasons for Choosing science over music or medicine over business. The reason a person may enter a particular career can be from stumbling upon a field that they knew little. Once discovering it they have ambitions of being the best they can be. It could also stem from a desire as a child to know more about a specific subject. Reasons may be distinct or similar to another person's in the same field. I will compare various anthropologists to how they started in anthropology and how they are different from one another. Anthropologists have stumbled upon or discovered the world of anthropology in their own ways. Barbara Smutts decided that she would study anthropology at the age of 13 (Rosenthal, 23). After reading Jane Goodall's first article about chimpanzees and with her love of animals and science she knew that anthropology would be her career (23). Adrienne Zihhnan, like Smutts, stumbled upon anthropology after reading an article. She read a book by Margaret Mead for a course at Miami University (Shell, 38). After reading it she changed her major and transferred to a college with the major (38). Zihhnan has made Paleoanthropology her specialized area. The origination of the two­legged gait has been her focus (Shell, 40). Smutts has studied Primatology and observed olive baboons and the bottle­necked dolphin (Roshenthal, 24 & 26). The discovery of a career through reading an article makes a person wonder if all big decisions could be that simple. Aslihan Yener discovered anthropology after transferring to Robert College to study art history (Bass, 64)... ...n/legkey http://www.anatomy.su.oz.au/danLiy/anthropology/anthro­1/bio­graphies/thorton "Linguistics." Encyclopedia of Cultural Anthropology: vol. 1, 1996. "Linguistics." The New Encyclopedia Britannica: vol. 7, 1993. Mead, Margaret. Leaders of Modem Anthropology: Ruth Benedict. New York: Columbia University Press, 1974. "Paleoanthropology." Academic American Encyclopedia: vol. 15, 1996. "Primatology." Encyclopedia of Human Evolution and Prehistory. 1988. Rosenthal, Elisabeth. "The Forgotten Female." Discover. Dec. 1991: 22­27. Shell, Ellen Ruppel. "Flesh and Bone. Discover. Dec. 1991: 37­42. Spencer, Robert F. Methods and Perspective in Anthropology. Minneapolis: The University of Minnesota Press, 1954. Steward, Julian H. Leaders of Modem Anthropology: Alfred Kroeber. New York: Columbia University Press, 1973.

Changes & Continuities of Silk Road Essay

The Silk Road which started in 200 BCE and ended it in 1450 CE has its own changes and continuities. Trade flourished between the Asian and Europe at the time and as time went on its sole purpose of trading expanded to many other purposes and affect not only the area it contacted. Although there were many continuities during the time but it has more significant changes that occurred and also impact the world. One significant changes of the Silk Road is when it was first started it mainly started as a way for trade to flourish between Europe and Asia. But the purpose of this Silk Road has also expanded to transcend different culture and technologies from different places and caused cultural diffusion along the Silk Road. This happened because the Silk Road has more than one route, some ends in the middle east , west Asia, and Europe. There were merchants of different races and religion like Muslim,. Buddhism, Christianity, Hinduism and more. This caused cultural diffusion between places like Buddhism were introduced to China and the Chinese paper making technology were spread toward the west to Europe. Another significant change that occurred is when the merchants travel on the Silk Road they are very likely to get attacked by bandits or get their goods stolen. But during the Mongolian reign this route was safer and merchants are not afraid of bandits along the way. This occurred because during the time of the Mongolian Empire they formed the ortoghs which means merchant association. Merchants traveled in pack instead of one which provide more security because this way merchants are less likely to get attack, and made trade safer. Like everything when there is change there is also continuities and one of them is the silk trade. Silk Road is called this name is because the main product traded on this route is silk. Even though many other items were traded in the silk road but the Europeans were very interested in these kind of fabric and they are luxurious because the European did not know how to make them. This is consider a continuity because for many decades the Chinese holds the secret for making these luxurious silk and because the Europeans and India wanted these silk so the Chinese could make a profit from it and they are consider a luxury. The reason the Chinese won’t let the outsiders know how to make these silk is because the process of it is hard and they depends mostly on trading these silk for the stuff they needed. Another continuities is the geography of the silk road. The silk road is consist of many route, some is shorter but dangerous while other is longer but safer. Even though some of the routes have changed and there is more variety of stuff that’s being traded than when it was started (e.g. Gunpowder) and the purpose of the road also expanded like people use it to spread religion and unfortunately is also been a route where disease easily spread (e.g. Black plagues) The continuity is the geography of the silk road never changed because both the European and Asia gained much profit from it that it doesn’t need to be change and the Silk Road remained the major trade route between Far Eastern Chinese and European cultures and sparked numerous conflicts in its existence. The Silk Road which have been known as a major trade route in the ‘old world’ and sparked numerous conflicts in its existence. It brought the goods and the bads like the plagues, cultural diffusion, introduction of new technologies and brought new religions to different part of that world. The Silk Road shape the world we have today and when it ended in 1450 CE it had impacted most of Europe and Asia.

Was Dollarization a Success in Zimbabwe

CHAPTER ONE [pic] 1. Introduction At independence in 1980 the Zimbabwe dollar replaced the Rhodesian dollar at par at a rate which was higher than the American dollar. Although this quickly deteriorated, it was not until the late nineties that a series of events led to the demise of the Zimbabwean dollar. In 2008 in an 18-month ‘experiment’, foreign currency was accepted as legal tender for transactions with a set number of retailers. Honorable Members will be aware that in the hyper-inflationary environment characterizing the economy at present, our people are now using multiple currencies for day to day business transactions, alongside the Zimbabwe dollar. These currencies include the South African Rand (ZAR), United States Dollar (USD), Botswana Pula (BWP), Euro, and British Pound Sterling, among others. In line with the prevailing practices by the general public, Government is, therefore, allowing the use of multiple foreign currencies for business transactions, alon gside the Zimbabwe dollar. †[1]However, months later, in March of 2009, the newly instated Finance Minister, Tendai Biti, announced that the Zimbabwe dollar would be suspended indefinitely. [2] The main argument in this piece is that the Zimbabwean crisis in the 2000s and the subsequent stabilization of the economy were made possible by the dollarization of the Zimbabwean economy in 2009. This article investigates the recent monetary experience of Zimbabwe with dollarization. It shows how dollarization has allowed Zimbabwe to quash hyper-inflation[3], restore stability, increase budgetary discipline, and re-establish monetary credibility.This paper analyses the effects of the dollarization of the Zimbabwean economy in 2009, in the wake of devastating hyper-inflation and a political crisis that reached its zenith with the electoral crisis of 2008. Though there is a direct nexus between the two processes, the former cannot be exclusively ascribed to the latter; there are a host of other issues that have contributed to the economic and financial breakdown in Zimbabwe. 1. 11 The Background to the ProblemThe Reserve Bank of Zimbabwe (RBZ) was forced to revalue the Zimbabwean dollar, three times in a space of less than three years, because of rampant hyper-inflation in the country. In August 2006, in an operation called ‘Sunrise 1’, the RBZ removed 3 zeroes from Zimbabwe’s currency and promised to introduce a new currency in the near future. In August 2008, exactly two years after the first revaluation, the RBZ slashed a further 10 zeroes from Zimbabwe’s currency, calling this ‘Sunrise II’. Rampaging hyper-inflation forced the government to erase another 12 zeroes in early February 2009.This was ‘Sunrise III’. Thus, a staggering 25 zeroes had been slashed from the Zimbabwean currency within a space of only three years. The hyper-inflation was just unsustainable, and when the Zimbabwean dollar was officially shelved in March 2009, the highest single denomination was a 100 trillion dollar note. When the 100 trillion dollar note was introduced on 16 January 2009, it was worth the equivalent of US$ 30 on the parallel market. The establishment of the Government of National Unity (GNU) saw the dollarization of the Zimbabwean economy and the shelving of the Zimbabwean dollar in March 2009.Dollarization is a portfolio shift away from domestic currency to foreign currency, to fulfil the main functions of money – store of value, unit of account, and medium of exchange. It is typically a result of unstable macroeconomic conditions and is a rational response of people seeking to diversify their assets in the face of heightened domestic currency risk. Efforts to revive the battered Zimbabwean economy, largely through the dollarization of the Zimbabwean economy are assessed through the lens of the banking sector.The banking sector thrived during the peak of the Zimbabwean crisis, as most bank s became key players in highly speculative activities in areas such as Zimbabwe’s bullish stock exchange and real estate. The profits that were being realized in the banking sector trickled down to their workers who became the best remunerated workers amongst all the sectors in Zimbabwe. With dollarization of the economy in 2009, the once vibrant banking sector was suddenly facing the grim prospect of disintegration, which had plagued sectors such as teaching during the peak of the Zimbabwean crisis.The banking sector was adversely affected by the dollarization of the economy, as the speculative activities that were reaping huge rewards for the banks were wiped out overnight by the adoption of more stable currencies at the expense of the precarious Zimbabwean dollar. This spelt disaster for the banking fraternity, as most banks in the first few months of dollarization struggled to pay their workers in hard currency and instead were forced to downsize their operations and lay- off some of their employees.The paper argues that in complete contrast to most sectors in the economy, the banking sector boomed during the crisis, and the Zimbabwe Congress of Trade Unions (ZCTU) monthly remuneration lists in 2008 saw the banking workers consistently topping the lists. However, the dollarization of the Zimbabwean economy turned the tables on this once prosperous sector, as bank workers like the bank tellers and other clerical workers found themselves being laid-off, as most banks struggled to remunerate their workers in hard currency. 1. 12 Objectives ? To assess the performance of the banking sector before and after dollarization. To investigate the effects of dollarization of the Zimbabwean economy on the banking sector. ? To investigate the advantages and disadvantages of dollarization on the banking sector. 1. 13 The Research Problem The effects of dollarization on the banking sector after the dollarization of the Zimbabwean economy. 1. 14 The Research Question What effect does the dollarization of the Zimbabwean economy have on the banking sector? 1. 15 Sub Questions 1. What is dollarization? 2. What are the forms of dollarization? 3. What are the costs of dollarization? 4.What are the benefits of dollarization? 5. What impact does dollarization have on the banking sector? 6. Was dollarization a success in Zimbabwe? 1. 17 Significance of the study To the researcher The research is in partial fulfillment of the requirements of a Bachelor of Commerce Honours Degree in Accounting at the National University of Science and Technology. It will allow the researcher to have a deeper understanding and both theoretical and practical knowledge in the area of research and encourage a practical application of theoretical concepts on the area under study.To the banking sector The research is set to provide enlightment on the impact of dollarization of the Zimbabwean economy to the banking sector. To the university The research project will assist the university in coming up with a curriculum on the study of the dollarization of the Zimbabwean economy and the impact that it had on the banking sector. 1. 18 Assumptions ? All respondents have adequate knowledge of the developments in their particular organizations. ? Respondents will give truthful responses adequate to make reasonable inferences. The researcher assumes that respondents will respond within a reasonable time period to enable the timetable to be adhered to. ? The researcher assumes that he will have enough financial resources to meet all the expenses. ? There will not be institutional disturbances that could delay completion of the project. ? Secondary data will be available. 1. 19 Literature Review Data will be collected from the textbooks, libraries, newspapers, journals and the internet. 1. 20 Theoretical Framework Was the dollarization of the Zimbabwean economy a success to the banking sector?The research intends to use both primary and secondary sources of data. These sources of data will help to explore an analysis of what past researchers have brought to light in relation to the impact of the dollarization of the Zimbabwean economy on the banking sector. It is under this section that the researcher intends to explain various forms of dollarization. The benefits and costs of dollarization shall be explored through exclusive use of the internet and various text books and journals. 1. 21 Definitions of TermsFor the purpose of this study the following abbreviations and definitions will be used. Hyper-inflation – Ruinously  high  increase (50  percent  or more per month) in  prices  due  to the near total  collapse  of a  country's  monetary system, rendering its  currency  almost worthless as a  medium of exchange. Although hyperinflation is caused mainly by excessive  deficit spending  (financed by  printing  more  money) by a  government, some  economists  believe that social  breakdown  leads  to hyperinflation (not vice versa), and that its roots lie in political rather than economic  causes. 4] Dollarization – occurs when the inhabitants of a country use foreign  currency  in parallel to or instead of the domestic currency as a store of value, unit of account, and/or medium of exchange within the domestic economy. The term is not only applied to usage of the  United States dollar, but generally to the use of any foreign currency as the national currency. [5] BWP – Botswana Pula GNU – Government of National Unity USD – United States Dollar RBZ – Reserve Bank of Zimbabwe ZAR – South African Rand ZCTU- Zimbabwe Congress of Trade Unions 2. 00 Research DesignSample of people to send questionnaire is going to be based on knowledge, accessibility and convenience. 2. 11 Instruments for Data Collection The research will be based on both primary and secondary methods of collecting data which include surveys, interviews, questionnaires and published information and journals. The researcher will use a number of methods in the collection of primary and secondary information. The following methods will be used to gather primary information: ? Questionnaires- these will be designed and hand posted to the selected respondents.Sample of people to send questionnaire is going to be based on knowledge, accessibility and convenience. ? Interviews- interviews will be conducted to collect some of the information required in the research. The following sources will be used to tap all secondary data available about the subject: ? Use of textbooks ? The researcher in the course of the research will access newspapers, financial reports, business journals and the Internet. Information will also be attained through discussions with classmates and fellow researchers. 2. 2 Data Presentation and Analysis There will be use of tables, graphs and statistical tools/methods including pie charts in data presentation and anal ysis. These will be used first to present the data obtained through the questionnaires in the interviews, which will then make possible the analysis of the data in a more objective and quantitative manner as well as less subjective and qualitative way. A report shall then be compiled and presented on the final outcome of the findings and analysis. 2. 13 Research Timetable and Budget (Project Scheduling)Research Time Table SectionChapterMonth/Period Introduction1Two weeks Literature Review2Two weeks Research Method3Four Weeks Data Presentation ; Analysis4Four Weeks Conclusion and Recommendation5Two weeks Research Budget Cost CenterCost Amount (USD) Typing and Printing$20 Photocopying$20 Internet$30 Traveling costs$50 Food Costs$30 Total$150 2. 14 Research Limitations ? The research is going to be limited due to the studies that will be going on concurrently with the research project and the time committed to the research project will be reduced. Time, unforeseen institutional disturb ances at N. U. S. T. may delay timely completion of the research project. ? Lack of cooperation – there could be unexpected lack of cooperation from respondents, if any are to be involved in the project. ? Possible limited access to confidential information, which might be useful for the purposes of the research. ? Financial constraints – The research could be affected by the writer’s limited funds to fully meet all due costs to be incurred during the research 2. 15 Source ReferencingThe â€Å"According to â€Å"Kararach G, Kadenge P, and Guvheya G, (2010). CURRENCY REFORMS IN ZIMBABWE: AN ANALYSIS OF POSSIBLE CURRENCY REGIMES,† will be used. 2. 16 Bibliography (a) Books The Harvard way of referencing shall be employed (b) Journals The â€Å"According to â€Å"Kararach G, Kadenge P, and Guvheya G, (2010). CURRENCY REFORMS IN ZIMBABWE: AN ANALYSIS OF POSSIBLE CURRENCY REGIMES,† will be used. ——————— – [1] (Acting Minister of Finance, Cde Patrick Chinamasa on Budget Presentation to Parliament on 29 January 2009. ) [2] Ibid. ; Biti, T. ‘Statement on the 2009 Budget’, Presented to the Parliament of Zimbabwe by the Minister of Finance, 17 March 2009, http://www. zimtreasury. org [3] Hyper-inflation is defined by Hanke (2008) as a situation where the year- on- year rate of inflation breaches the 12,875 percent mark. Zimbabwe began to hyper-inflate in 2007 and hyper-inflation was officially reported by the Zimbabwe Central Statistical Office to have peaked at 231 million percent in July 2008. [4] http://www. businessdictionary. com/definition/hyperinflation. html [5] http://www. answers. com/topic/dollarization#ixzz2BXaOhuVJ ———————– 1

Financial Derivative Case Studies Essay

INTRODUCTION Financial derivatives have crept into the nation’s popular economic vocabulary on a wave of recent publicity about serious financial losses suffered by municipal governments, well-known corporations, banks and mutual funds that had invested in these products. Congress has held hearings on derivatives and financial commentators have spoken at length on the topic. Derivatives, however remain a type of financial instrument that few of us understand and fewer still fully appreciate, although many of us have invested indirectly in derivatives by purchasing mutual funds or participating in a pension plan whose underlying assets include derivative products. In a way, derivatives are like electricity. Properly used, they can provide great benefit. If they are mishandled or misunderstood, the results can be catastrophic. Derivatives are not inherently â€Å"bad.† When there is full understanding of these instruments and responsible management of the risks, financial derivatives can be useful tools in pursuing an investment strategy. DERIVATIVES: A derivative is a contractual relationship established by two (or more) parties where payment is based on (or â€Å"derived† from) some agreed-upon benchmark. Since individuals can â€Å"create† a derivative product by means of an agreement, the types of derivative products that can be developed are limited only by the human imagination. Therefore, there is no definitive list of derivative products. Why Have Derivatives? Derivatives are risk-shifting devices. Initially, they were used to reduce exposure to changes in foreign exchange rates, interest rates, or stock indexes. For example, if an American company expects payment for a shipment of goods in British Pound Sterling, it may enter into a derivative contract with another party to reduce the risk that the exchange rate with the U.S. Dollar will be more unfavorable at the time the bill is due and paid. Under the derivative instrument, the other party is obligated to pay the company the amount due at the exchange rate in effect when the derivative contract was executed. By using a derivative product, the company has shifted the risk of exchange rate movement to another party. More recently, derivatives have been used to segregate categories of investment risk that may appeal to different investment strategies used by mutual fund managers, corporate treasurers or pension fund administrators. These investment managers may decide that it is more beneficial to assume a specific â€Å"risk† characteristic of a security. For instance, several derivative products may be created based on debt securities that represent an interest in a pool of residential home mortgages. One derivative product may provide that the purchaser receives only the interest payments made on the mortgages while another product may specify that the purchaser receives only the principal payments. These derivative products, which react differently to movements in interest rates, may have specific appeal to different investment strategies employed by investment managers. The financial markets increasingly have become subject to greater â€Å"swings† in interest rate movements than in past decades. As a result, financial derivatives have appealed to corporate treasurers who wish to take advantage of favorable interest rates in the management of corporate debt without the expense of issuing new debt securities. For example, if a corporation has issued long term debt with an interest rate of 7 percent and current interest rates are 5 percent, the corporate treasurer may choose to exchange (i.e., Swap), interest rate payments on the long term debt for a floating interest rate, without disturbing the underlying principal amount of the debt itself. RISK INVOLE IN DERIVATIVES: There are four risk associated with derivatives. * Market risk * Operational risk * Counter party credit risk * Legal risk Market risk: The risk to earnings from adverse movements in market prices. Operational risk: The risk of losses occurring as a result of inadequate systems and control, human error, or management failure. Counter party credit risk: The risk that a party to a derivative contract will fail to perform on its obligation. Exposure to counterparty credit risk is determined by the cost of replacing a contract if a counterparty (as a party to a derivatives contract is known) were to default. Legal risk: The risk of loss because a contract is found not to be legally enforceable. Derivatives are legal contracts. Like any other contract, they require a legal infrastructure to provide for the resolution of conflicts and the enforcement of contract provisions. CORPORATION: BARING: Barings PLC was the oldest merchant bank in Great Britain. Founded in 1762. With total shareholder equity of  £440 million, it was far from the largest or most important banking organization in Great Britain. Barings had long enjoyed a reputation as a conservatively run institution. But that reputation was shattered on February 24, 1995, when Peter Baring, the bank’s chairman, contacted the Bank of England to explain that a trader in the firm’s Singapore futures subsidiary had lost huge sums of money speculating on Nikkei-225 stock index futures and options. In the days that followed, investigators found that the bank’s total losses exceeded US$1 billion, a sum large enough to bankrupt the institution. STRATEGIES AND TRANSACTION: CONTEXT: In 1992, Barings sent Nicholas Leeson, a clerk from its London office, to manage the back-office accounting and settlement operations at its Singapore futures subsidiary. Baring Futures (Singapore), hereafter BFS, was established to enable Barings to execute trades on the Singapore International Monetary Exchange (SIMEX). The subsidiary’s profits were expected to come primarily from brokerage commissions for trades executed on behalf of customers and other Barings subsidiaries. Most of BFS’s business was concentrated in executing trades for a limited number of financial futures and options contracts. These were the Nikkei-225 contract, the 10 year Japanese Government Bond (JGB) contract, the three-month Euroyen contract, and options on those contracts (known as futures options). The Nikkei-225 contract is a futures contract whose value is based on the Nikkei-225 stock index, an index of the aggregate value of the stocks of 225 of the largest corporations in Japan. The JGB contract is for the future delivery of ten-year Japanese government bonds. The Euroyen contract is a futures contract whose value is determined by changes in the three-month Euroyen deposit rate. A futures option is a contract that gives the buyer the right, but not the obligation, to buy or sell a futures contract at a stipulated price on or before some specified expiration date. STRATEGIES: During late 1992 or early 1993, Leeson was named general manager and head trader of BFS. Leeson never relieved his authority over the subsidiary’s back-office operations when his responsibilities expanded including trading. Barings’s management understood that such trading involved arbitrage in Nikkei-225 stock index futures and 10-year Japanese Government Bond (JGB) futures. Both contracts trade on SIMEX and the Osaka Securities Exchange (OSE). Leeson soon embarked upon a much riskier trading strategy. Rather than engaging in arbitrage, as Barings management believed, he began placing bets on the direction of price movements on the Tokyo stock exchange. Leeson’s reported trading profits were spectacular. His earnings soon came to account for a significant share of Barings total profits; the bank’s senior management regarded him as a star performer. After Barings failed, however, investigators found that Leeson’s reported profits had been fictitious from the start. By manipulating information on his trading activity, Leeson was able to conceal his trading losses and report large profits instead. A major part of Leeson’s trading strategy involved the sale of options on Nikkei-225 futures contracts. The seller of an option earns a premium in return for accepting the obligation to buy or sell the underlying item at a stipulated strike price. If the option expires â€Å"out-of-the money,† the option premium becomes the seller’s profit. If prices turn out to be more volatile than expected, however, an option seller’s potential losses are virtually unlimited. Sometime in 1994, Leeson began selling large numbers of option straddles, a strategy that involved the simultaneous sale of both calls and puts on Nikkei-225 futures. TRANSACTION: Leeson’s trading losses from 1992 through the end of February 1995. By the end of 1992—just a few months after he had begun trading—Leeson had accumulated a hidden loss of  £2 million. until October 1993, when his losses began to rise sharply. He lost another  £21 million in 1993 and  £185 million in 1994. Total cumulative losses at the end of 1994 stood at  £208 million. That amount was slightly larger than the  £205 million profit reported by the Barings Group as a whole, before accounting for taxes and for  £102 million in scheduled bonuses. By January 1, 1995, Leeson was short 37,925 Nikkei calls and 32,967 Nikkei puts. He also held a long position of just over 1,000 contracts in Nikkei stock index futures, which would gain in value if the stock market were to rise. WHAT WENT WRONG? HOW WAS THE LOSS ACCUMULATED? Disaster struck on January 17 when news of a violent earthquake in Kobe, Japan, sent the Japanese stock market into a tailspin. Over the next five days, the Nikkei index fell over 1,500 points Leeson’s options positions sustained a loss of  £68 million. As stock prices fell, he began buying massive amounts of Nikkei stock index futures. By February 6, the Japanese stock market had recovered by over 1,000 points, making it possible for Leeson to recoup most of the losses resulting from the market’s reaction to the earthquake. cumulative losses on that date totaled  £253 million, about 20 percent higher than they had been at the start of the year but within some days market began to fall again making losses to multiply. Barings faced massive margin calls as Leeson’s losses mounted. While these margin calls raised eyebrows at the bank’s London and Tokyo offices, they did not prompt an immediate inquiry into Leeson’s activities. It was not until Feb ruary 6 that Barings’s group treasurer, Tony Hawes, flew to Singapore to investigate irregularities with the accounts at BFS. Barings had committed a total of  £742 million to finance margin calls for BFS. WHO WAS RESPONSIBLE FOR THE LOSS? Some observers blame this lack of communication on the rivalry between the two exchanges. Communication between SIMEX and the OSE was minimal, however this lack of communication not only helped make it possible for Leeson to accumulate large losses but also hampered efforts to contain the damage once Barings collapsed. The exchange’s attitude toward Barings was influenced in part by the bank’s strong international reputation, but its willingness to relax normal risk management guidelines also may have been attributable to its desire to attract business. Events surrounding the collapse of Barings have served to highlight weaknesses in risk management on the part of SIMEX and other futures exchanges. Barings’ collapse was due to the unauthorized and ultimately catastrophic activities of, it appears, one individual (Leeson) that went undetected as a consequence of a failure of management and other internal controls of the most basic kind. Management failed at various levels and in a variety of ways WHAT LESSONS ARE TO BE LEARNED FROM THE CASE/ DISASTER? HIGHLIGHTED WEAKNESS: (1) The lack of communication between securities and futures exchanges and regulators in different countries, and (2) Conflicting laws on the legal status of customer accounts at futures brokers and clearing agents in the event of insolvency. These weaknesses can be addressed only by increased international cooperation among futures exchanges, regulators, and lawmakers. * Management teams have a duty to understand fully the businesses they manage. * Responsibility for each business activity has to be clearly established and communicated. * Clear segregation of duties is fundamental to any effective control system. * Relevant internal controls, including independent risk management, have to be established for all business activities. * Top management and the Audit Committee have to ensure that significant weaknesses, identified to them by internal audit or otherwise, are resolved quickly. METALLGESELLSCHAFT: Metallgesellschaft AG (hereafter, MG) is a large industrial conglomerate engaged in a wide range of activities, from mining and engineering to trade and financial services. In December 1993, the firm reported huge derivatives-related losses at its U.S. oil subsidiary, Metallgesellschaft Refining and Marketing (MGRM). STRATEGIES AND TRANSACTION: CONTEXT: In 1992, MGRM began implementing an aggressive marketing program in which it offered long-term price guarantees on deliveries of gasoline, heating oil, and diesel fuels for up to five or ten years. The first was a â€Å"firm fixed† program, under which a customer agreed to fixed monthly deliveries at fixed prices. The second, known as the â€Å"firm-flexible† contract, specified a fixed price and total volume of future deliveries but gave the customer some flexibility to set the delivery schedule. STRATEGY: By September 1993, MGRM had committed to sell forward the equivalent of over 150 million barrels of oil for delivery at fixed prices, with most contracts for terms of ten years. Both types of contracts included options for early termination. These â€Å"cash-out provisions† permitted customers to call for cash settlement on the full volume of outstanding deliveries if market prices for oil rose above the contracted price. Its contracted delivery prices reflected a premium of $3 to $5 per barrel over the prevailing spot price of oil. MGRM sought to offset the exposure resulting from its delivery commitments by buying a combination of short-dated oil swaps and futures contracts as part of a strategy known as a â€Å"stack-and-roll† hedge. TRANSACTION: In its simplest form, a stack-and-roll hedge involves repeatedly buying a bundle, or â€Å"stack,† of short dated futures or forward contracts to hedge a longer-term exposure. Each stack is rolled over just before expiration by selling the existing contracts while buying another stack of contracts for a more distant delivery date; hence the term stack-and-roll. MGRM implemented its hedging strategy by maintaining long positions in a wide variety of contract months, which it shifted between contracts for different oil products (crude oil, gasoline, and heating oil) in a manner intended to minimize the costs of rolling over its positions. Had oil prices risen, the accompanying gain in the value of MGRM’s hedge would have produced positive cash flows that would have offset losses stemming from its commitments to deliver oil at below-market prices. As it happened, however, oil prices fell even further in late 1993. Moreover, declines in spot and near-term oil futures and forward prices significantly exceeded declines in long-term forward prices. As a result, contemporaneous realized losses. WHAT WENT WRONG? HOW WAS THE LOSS ACCUMULATED? Decline in oil prices caused funding problems for MGRM. The practice in futures markets of marking futures contracts to market at the end of each trading session forced the firm to recognize its futures trading losses immediately, triggering huge margin calls. Normally, forward contracts have the advantage of permitting hedgers to defer recognition of losses on long-term commitments. But MGRM’s stack-and-roll hedge substituted short-term forward contracts (in the form of short-term energy swaps maturing in late 1993) for long-term forward contracts. As these contracts matured, MGRM was forced to make large payments to its counterparties, putting further pressure on its cash flows. At the same time, most offsetting gains on its forward delivery commitments were deferred. MG reported losses of DM 1.8 billion on its operations for the fiscal year ended September 30, 1993, in addition to the DM 1.5 billion loss auditors attributed to its hedging program as of the same date. WHO WAS RESPONSIBLE FOR THE LOSS? MG’s board of supervisors fired the firm’s chief executive and installed new management. The board instructed MG’s new managers to begin liquidating MGRM’s hedge and to enter into negotiations to cancel its long-term contracts with its customers. This action further complicated matters. The actions of MG’s board of supervisors in this incident have spurred widespread debate and criticism, as well as several lawsuits. Some analysts argue that MGRM’s hedging program was seriously flawed and that MG’s board was right to terminate it. Others, including Nobel Prize-winning economist Merton Miller, argue that the hedging program was sound and that MG’s board exacerbated any hedging-related losses by terminating the program too early. WHAT LESSONS ARE TO BE LEARNED FROM THE CASE/ DISASTER? Considering the debate over the merits of MGRM’s hedging strategy, it would seem naive simply to blame the firm’s problems on its speculative use of derivatives. It is true that MGRM’s hedging program was not without risks. But the firm’s losses are attributable more to operational risk—the risk of loss caused by inadequate systems and control or management failure—than to market risk. If MG’s supervisory board is to be believed, the firm’s previous management lost control of the firm and then acted to conceal its losses from board members. If one sides with the firm’s previous managers (as well as with Culp, Hanke, and Miller), then the supervisory board and its bankers misjudged the risks associated with MGRM’s hedging program and panicked when faced with large, short-term funding demands. Either way, the loss was attributable to poor management. FINAL CONCLUSION OF BOTH CASES: The cases of Metallgesellschaft and Barings provide an interesting study in contrasts. Both cases involve exchange-traded derivatives contracts. In both cases, senior management has been criticized for making an insufficient effort to understand fully the activities of their firms’ subsidiaries and for failing to monitor and supervise the activities of those subsidiaries adequately. But while critics have faulted MG’s management for overreacting to the large margin calls faced by one of its subsidiaries, Barings’s management has been faulted for being overly complacent in the face of a large number of warning signs. If these two disparate incidents offer any single lesson, it is the need for senior management to understand the nature of the firm’s activities and the risks that those activities involve.

Plagiarism Essay Example | Topics and Well Written Essays - 500 words - 13

Plagiarism - Essay Example Special Forces--were working through Argentine intermediaries to set up contra safe houses, training centres, and base camps along the Nicaraguan-Honduran border." (Peter Kornbluh, "Nicaragua," in Michael Klare (ed), Low Intensity Warfare (New York, 1983), 139.) In the early 1980s, the Reagan Administration made increasing use of Honduras as a base for the contra war. The Administration set up a number of military and training facilities--some American, some contra, and some housing Argentine mercenaries--along the border between Nicaragua and Honduras (Kombluh 139). The country, as one observer noted, was little more than "a [stationary] aircraft carrier," which he described as "the USS Honduras† (Lafeber 309). The strike officially began on May 29, and on June 1 the manufacturers met publicly to plan their resistance. Their strategies were carried out on two fronts. They pressured the proprietors into holding out indefinitely by refusing to send new collars and cuffs to any laundry. Also the manufacturers attempted to undermine directly the union’s efforts to weather the strike. They tried to create a negative image of the union through the press, which they virtually controlled. They prevented a few collar manufacturers in other cities from patronizing the unions’ cooperative laundry even though it claimed it could provide the same services for 25 percent less. Under these circumstances, the collar ironers’ tactics were much less useful. Two days after the strike began on May 29, the manufacturers met publicly to plan their response. They had two strategies. They pressured the owners into holding out indefinitely by declining to send new collars and cuffs to any laundry, and they tried to directly destabilize the union’s efforts to outlast the strike. They also tried to create a negative image of the union through the newspapers, which they virtually controlled. They prevented a few collar manufacturers in other cities from using the

Brand management Assignment Example | Topics and Well Written Essays - 2000 words

Brand management - Assignment Example A mixture of various marketing media is called branding. Branding tends to give an identity and captures the mind of the customers with the name of the brand. Depending on the brand value and the intended target segment, companies of all sizes are increasingly weighing their options whether to promote their marketing campaigns through the social networking sites, since there are high chances of possible dilution of the brand value as well as backlash coming from negative feedback and comments from disgruntled and unhappy consumers (Smith and Zook, 2011, p. 14). So, companies are increasingly taking a much more conscious step in their effort to promote the brands in the minds of today’s tech savvy consumers by the usage of promotion techniques such as website promotion, email marketing and mobile promotions. Brand Image The current outlook of the customers regarding a brand is called brand image. Brand image can be looked upon as the set of beliefs the target customers hold I r espect of a certain brand. Brand image is constructed in the minds of the customers from all sources. Brand image has the potential to convey emotional value. The basis of an image in the mind of customers depends upon the subjective perceptions that the consumers have in respect of some brands. When a consumer decides to purchase a product, he is not purchasing only the product itself but also the brand. It is the image that drives the consumers to buy that brand. The brand communications can help to strengthen the images. There are four steps by which a certain product can create its brand image. Creating a brand image is essential to sustain in the long run. The product must be uniquely valuable and present itself in front of the customers in such a fashion that customer can have a clear idea of the benefits that the product provides. The product should communicate with the customer in such a manner that is easily understandable and easy to remember. Another important step in ord er to create brand image is to differentiate itself from the already existing competitors. The new brand must analyze the key selling points of the competitors. The brand will have to set a new structure of promises to the customer, which it will be able to deliver. In fact, the promises offered by the new brand may become the selling point for the brand. The marketing strategies of the brand should revolve with a central theme. The theme may consist of a single idea, and this will act as the focus in all external communications. The brand that is willing to penetrate into the market must live up to the promises made. So the first and foremost step to penetrate into the market is not to make fake promises which the brand cannot live up to. If the brand fails to fulfill the expectations, then in spite of many attempts, it will not be able to enter the market according to its desires. Brand image is created only when the brand creates and meets the expectations. Brand Salience The pro pensity of the brand to come into the mind of the customers in the situations of buying is regarded as brand salience. It differs from the concept of awareness. It reflects the quality as well as the quantity of the network that buyers hold in their minds. The ability of an item to stand out from its competitors and create its own identity is regarded as the concept of salience. The concept of brand salience has achieved much prominence in the brand

Feminism shown throughout the book called Frankenstein by Mary Shelley Essay

Feminism shown throughout the book called Frankenstein by Mary Shelley - Essay Example Some have considered it quite ironic for a person like Mary Shelley to write a novel in which all female characters have marginal representation compared to the male characters. Shelley was born to a very notable Victorian feminist named Mary Wollstonecraft. Yet, she has portrayed women as creatures of little wisdom or independence in her most distinguished novel. For example, when the text says that â€Å"He came like a protecting spirit to the poor girl, who committed herself to his care;† (Shelley 26), it is suggested by Viktor that Caroline, his mother, had no capacity to look after herself and looked up to his father to be taken care of. She clearly has no means to support herself financially and so, marries Viktor’s father for survival. This possessibility of women, depicted in the novel, could be due to the fact that Shelley wrote in a time when women were expected to abide by some rules which were set for them by the conservative society in which they lived. Her novel does not speak of women with spirited enthusiasm, rather they are described in a very ordinary way which makes the readers perceive them as ordinary and powerless. For example, at one point, Viktor speaking of his mother says that in his childhood, â€Å"she presented Elizabeth to me as her promised gift† (Shelley 30). Here, it is clear how powerless women then were because Elizabeth, while being unaware herself, is promised by another woman to his child. Elizabeth has no say in this important matter of her life, rather she is treated like an object and handed over to a child. There is a huge gender gap which is clearly noticeable in Frankenstein. This is even considered a sexist book by many critics. Negative portrayal of women in the novel is traced back by some to the time in which Shelley lived when women were brought up in a such a way that they could not think of