Role of Financial Systems in a Modern Economy

Role of Financial Systems in a Modern Economy According to Ray Dalio the economy is like a machine. A machine is made up of several different components that when all working together run smoothly, the several different components that keep an economy running smoothly is known as the financial system. The financial system is made up of the central bank, markets, and financial institutions, and when all working in harmony in turn creates a smooth economy. The central bank prints money and controls interest rates, the financial institutions are a place where savers take their money to earn more and borrowers go to borrow money to purchase a home or invest in a business, and the markets are in place so that businesses can get investors to grow their business and investors can earn more on their investments. When all the parts of a financial system works harmoniously the citizens of a country benefit tremendously. Since a good financial system means a good economy it means that interest rates will be lower and with lower interest rates it means that borrowers will borrow more and invest more in business ventures which in turn creates more jobs. The more jobs there are for the citizens of a country the more they spend which means more money gets pushed back into the economy, and creates a booming economy. In a perfect world the financial system would always work perfectly and the economy would always boom, but unfortunately we know from p ast events in the United States that is not the case. The great depression and the recession in 2008 are both examples of how a faulty financial system can cause the economy to crash. The main cause of the great depression and the recession in 2008 was said to be the government. In the case of the great depression the Federal Reserve contributed to the crisis because the economy was booming when interest rates were low and people were applying for loans, the government decided to suddenly the raise of interest rates which caused a sudden halt in the boom. Whereas, with the recession in 2008 banks were allowing uncreditworthy individuals to apply for mortgages loans that they were unable to pay back. Similarly, both presidents at the time respond to the financial crisis the same way with a federal budget and instead of cutting spending both presidents went on to spend more money. After the increase in federal spending unemployment remained high during both crisis. During Roosevelts presidency unemployment was at twenty one percent and during Obamas term unemployment was eight percent and increased over two percent over time. During the great depression and the rece ssion both presidents were spending a lot of money and it did not help unemployment rates instead unemployment still remained high. When an economy is falling, the government turns to the wealthy for more money and taxes this is what happened during the great depression. This put many Americans in the fiftieth percentile tax bracket meaning the wealthy had to pay more than half of their income. President Obama is trying to tax differently, instead of taxing the wealthy President Obama is raising taxes on items like cigarettes, liquor, plane tickets, and soft drinks. The recession is said to be the next worse period since the great depression. During both crisis the housing market was booming with low interest rates and the banks were lending money to people who were unable to pay back loans, the unemployment rate was high, and taxes were being raised. It was almost as if the past was repeating itself, the 2008 recession was going in the direction of the great depression. In order to prevent financial crisis such as the great depression and the recession of 2008 the financial system is highly regulated. As history in the United States shows when the financial system is left largely alone, the financial system has experienced periods of instability that have led to economic recessions. (Jafri, 2015) There are now several different measures put in place in order to monitor and regulate the financial system such as the Securities and Exchange Commission, SEC, and the Federal Deposit Insurance Corporation, FDIC, the Office of the Comptroller of the Currency, and the Federal Reserve System. The Security and Exchange Commission regulates the financial markets to help build the trust of investors in the markets again and â€Å"was created to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation†. (http://www.sec.gov) The Federal Deposit Insurance Corporation, FDIC, was created to help restore the trust of the depositors in the banks, it insures deposits made at financial institutions and the Office of the Comptroller of the Currency helps to regulate federally chartered banks. Finally, the Federal Reserve is the central bank of the United States and is also known as the â€Å"Fed†. It is ran by the Board of Governors, which consist of seven member who are appointed by the president of the United States. The Federal Reserve acts as a lender of last resort and makes short- term loans that provide banks with funds. â€Å"During the economic crisis that began in 2007, the financial system was disrupted, and large sec tions of the U.S. economy were cut off from the flow of funds they need to thrive.† (Hubbard, O’Brien, 2012, pg. 1) The financial crisis resulted in a decline in productions of goods and services throughout the economy. What does the financial system do? Economist believe there are three Key elements provided by banks to a financial system; risk sharing, liquidity, and information. Risk sharing is a service the financial system provides that allows savers to spread and transfer risk. Whereas, with liquidity it allows savers and borrowers to exchange assets for money. Lastly, information is important because in it is a collection and communication of the information and expectations borrowers need to know about return on assets. All these measures are taken by the government so that the citizen of the United States have more faith in the financial system. The key to a great economy is a great financial system. History has shown, with events like the Great Depression and the Recession in 2008, that there are hiccups that happen from time to time but federal regulation helps to restore faith back in the financial system so that citizens of the United States will continue to save, borrow, invest, and spend which are all key components to a booming economy functioning smoothly. References The Investors Advocate: How the SEC Protects Investors, Maintains Market Integrity, and Facilitates Capital Formation. (2013, June 10). Retrieved June 30, 2015, from http://www.sec.gov/about/whatwedo.shtml Dalio, R. (2013, September 22). How The Economic Machine Works by Ray Dalio. Retrieved June 30, 2015, from https://www.youtube.com/watch?v=PHe0bXAIuk0 Richard, R. (2013, November 22). The Great Recession of 2007à ¢Ãƒâ€šÃ¢â€š ¬Ãƒâ€šÃ¢â‚¬Å"09 A detailed essay on an important event in the history of the Federal Reserve. Retrieved June 30, 2015, from http://www.federalreservehistory.org/Events/DetailView/58 Folsom, B. (2010, May 20). Comparing the Great Depression to the Great Recession. Retrieved June 30, 2015, from http://fee.org/freeman/detail/comparing-the-great-depression-to-the-great-recession Hubbard, R., Brien, A. (2012). Money, banking, and the financial system (Second ed.). Boston: Prentice Hall. Dr. Jafri Chapter notes

Discussion on public magnet and charter schools

Nowadays an instruction is non a privilege for affluent people merely as it was some decennaries ago and in in-between ages. Every kid and every individual has an chance to have a certain degree of instruction for free. Many types of school are available today. Let us discourse three of them – public school, magnet school and charter school. What are differences between them? Public Schools To specify differences between the types of schools is impossible without the clear apprehension of the chief thought of every school. First of all, allow us analyze what is public school. It could be assorted types of educational establishments depending on the state. Largely, public schools is an educational establishment that is funded and run by the authorities ( normally it is funded through the revenue enhancements ) . Nevertheless, some public schools are run by different organisations and they are independent from the authorities ; we can see them private establishments. We can see that public schools are a consequence of the thought that authorities of a state has a duty for the degree of instruction of its citizens. Most of public schools charge a little stuff fee and they are free to go to. There are many assorted schooling theoretical accounts changing from state to state. Nevertheless, the most popular theoretical account of public instruction attentions about kids throu ghout childhood and in to the late teens. Some states besides provide an chance to acquire higher instruction for free. This chance is for those pupils who are citizens of a state. Besides some states provide a sort of partially authorities subsidise university plans. Talking about the United States, we can see that the authorities of the state operates figure of province colleges, although pupils are expected to pay different fee ( for illustration, tuition one ) . On the other manus, there are some fiscal assistance plans and authorities loan available for the citizens of the United States. In other states, like the United Kingdom, public schools are largely in private funded and bear down a high tuition fees ; these schools set a high admittance criterions. In such types of public schools tuition includes board and room. Most of the pupils live at the school during a term. These types of public schools have an impressive academic history and besides a long permanent tradition of household attending through over a coevals. In those states where public instruction is required and common, schooling is compulsory to a certain grade degree or age. If a individual wants to go a public school instructor, the certain grade from an commissioned university is required and good public standing every bit good. Government is maintaining checks on the public instruction system with the aid of system broad standardised trials. These trials are a sort of indicant of the degree of some basic accomplishments like simple mathematics and literacy. To sum up the thought of public school, allow us underscore the chief characteristics of it. This type of instruction includes kindergarten to 12-th class ( K – 12 ) ; besides public school refer to primary and secondary instruction ( besides it refers to the station secondary every bit good and advanced instruction, like for illustration proficient schools, university and colleges that are overseen and funded by authorities alternatively of private entities ) . State public instruction is inclusive in the intervention of pupils. Often it is operated and organized to became a calculated theoretical account of that civil community in which it s traveling to map. It could be provided to a group of pupils in a schoolroom in a cardinal school and it may be provided in – place as good ( it employs oversing instructor or sing instructors ) . State public instruction could be besides provided as shopping mall infinite ( non – school and non – place scenes ) . The chief characteristic of the province public instruction is that it is available to all people. Largely, it is mandatory for kids up to a certain age to go to a province public school ; nevertheless, the option of go toing a private school is unfastened for many people every bit good. In instance that a child attends private public school, such type of schools by and large defray its costs ( by bear downing parents tuition fee ) and operates independently of the province ( Suitts, 2008 ) . As we mentioned above, province public schools are funded by revenue enhancements largely. It means that en those people who are non go toing schools ( or their kids and their dependants are non go toing province public school ) aid to guarantee that citizens of a province are educated plenty. It is of import to advert that the term â€Å" public instruction † is non a equivalent word for the term â€Å" publically funded instruction † when it is applied to province schools. What does it means? For illustration, authorities could do a public policy determination to hold certain fiscal resources that are distributed in support ( or/and it could make up one's mind to hold some control over ) the proviso of private instruction. Voucher system and grants – in – assistance of the private schools give an illustration of publically funded private instruction. On the other manus, a province school ( including that schools that are run by a school territory ) could to a great extent trust on private support ( like private contributions or high fees ) ; this school would still be considered a province public school by virtuousness of governmental control and ownership. Normally, the province public instruction includes at that place following points: Standards and proving that are provided by authorities ; Compulsory pupils ‘ attending until a certain criterion of accomplishment or until the certain age ; Certification of course of study and instructors ; the enfranchisement could be provided by either instructors ‘ organisation or by authorities. In some states churches or private associations could run a school harmonizing to their principals ; they are free to make it until they comply with a certain demands of a province. In instance if the particular demands are non in understanding, a school receives a province support ( the particular demands could run into for illustration in the country of the school course of study ) . Then a school could be treated for accreditation intent and financially as a portion of the province public educational system, nevertheless they make a determination about school policy and hiring ( for illustration, non engaging atheists ) which authorities could non take itself. Many specializers assert the province public instruction to be necessary because it is demand of those people who are capable of making basic mathematics, composing and reading in the modern society. Some other people like libertarians, Teach that instruction is better to go forth for private sector. There is another group of people that are remaining for the alternate signifiers of instruction, like non – schooling. They argue that the same cognition and accomplishment is possible to accomplish without subjective pupils to province – tally compulsory schooling. How the province public schools are organized? As we mentioned earlier, they are provided by local authorities ; instruction, support and course of study and other policies as good are set through school boards that are locally elected by legal power over school territories. What are school territories? They are particular – purpose territories that are authorized by a proviso of province jurisprudence. In other words, province authorities has a right ( and utilize the right ) to supply a minimal criterions relation to all chief activities of secondary and primary schools and authorise and fund to ordain local school revenue enhancements every bit good to back up the province public schools ( this support is provided chiefly through existent belongings revenue enhancements ) . The federal authorities could financess material AIDSs to school and provinces that meet minimal federal criterions. Decisions about the school accreditation are made by voluntary regional associations. Ordinary, a province public school is divided in to a three phases: Elementary school ( kindergarten to fifth or sixth class ) ; In-between school ( junior high or â€Å" intermediate † school ) ; High school ( 9th or twelfths classs ) . In the in-between school is largely common the undermentioned format: the simple school contains the kindergarten through the 6th class, the in-between school contains seventh through 8th classs. Furthermore, some simple schools could be divided in to two more degrees: Primary school ( frequently it is K -2 ) ; Intermediate. Frequently these two schools are based in the separate edifices. One more emerging popular construct is the K – 8th format. In this format pupils could go to two schools merely for all their K – 12 instruction. In the K – 8 format all primary classs are houses that are situated in one subdivision of a school ( this state of affairs is more common for charter schools ) ; however, traditionally junior high school aged students are based in another subdivision of a school. Presently, some really little schools territories ( normally in rural countries ) sill maintain a K – 12 system harmonizing to which all students are housed in a individual school. In the United States, different establishments f the higher instruction that are subsidized and operated by the American province authorities is besides considered to be â€Å" public † . Nevertheless, public universities charge tuition ( unlike the public secondary school ) ; nevertheless these fees are normally much cheaper that the same fees that are charged by the private universities, for â€Å" in – province † pupils peculiarly. State universities, community colleges, and province colleges are the illustrations of public establishment of the higher instruction. The figure of the province universities is considered to be the best establishments of the higher instruction in the United States. However, they are frequently surpassed by some private colleges and universities in ranking. Among these private constitutions are those that are highly selective in the pupils they are accepting and they are expensive as good. The advantage of the public schools is obvious ( in principal, if non in pattern ever ) . In a state where the population is educated the degree of different accomplishments in the work force is meant to be increased and better public argument. Educated citizens are expected to be more likely to do thought out determinations and see the hereafter of their state. Charter Schools Now allow us research the charter schools and in which manner they are different from the province public schools. In the United States charter schools are secondary or chiefly schools that receive public money, furthermore, the can have private contributions like other schools ) . They are non a topic of some regulations, legislative acts and ordinances and this is the chief differences from the province public schools. Alternatively of it the charter schools have some types of answerability for the bring forthing of the certain consequences. The consequences are set Forth in every school ‘s charter. This type of schools is unfastened and could be attended by pick. Normally, charter schools are alternate to other public schools, however, they are besides portion of the public educational system ; charter schools are non allowed to bear down tuition. In that charter schools where the registration is over subscribed, the admittance is often allocated by the admittance that is lo ttery based. Some charter schools suggest a sort of the course of study that is specialized in a one certain field ( for illustration, the course of study could be specialized in mathematics, humanistic disciplines or linguistic communications, etc. ) it is one of the efforts to supply more efficient and better general instruction than nearby public schools. It is one more difference between public schools and charter schools. The following distinctive feature of charter schools is following: some of them are founded by parents, instructors or other militants who are restricted by the traditional public educational system. There are besides province – authorised charters that are frequently established by universities, non – net income groups and some authorities entities ( schools are non charged by local school territories ) . Furthermore, sometimes school territories permit corporations to pull off ironss of charter schools. Charter schools themselves are non – net income yet ; in this manner public schools could be managed by a for – net income corporation. It is non altering the position of a school. Talking about the construction and character of charter schools, we can advert that there are two chief principals that are steering the type of schools: Charter schools operate as independent public schools declining from figure of the procedural demands of the territory populace schools. It does non intend nevertheless that a school could be exempt from the same educational criterions that are set by the territory or authorities. The liberty could be necessary for making a certain school civilization ; the civilization should maximise pupils ‘ motives by stressing subject, academic asperity, relationships with caring grownups and high outlooks. Confirming pupils require the liberty to make a good balanced school civilization to fulfill the demands of the pupils. Particularly it is of import for those minority pupils in urban school territories, where the public presentation is affected by some societal phenomena stereotype menace, non – dominant cultural capital, â€Å" moving white † , and â€Å" a codification of a street † . The charter schools are accountable for the accomplishments of their pupils. The construction and regulations of the charter schools is differ from province to province and depend on the province authorizing. Any charter school once it received a charter, a public presentation contract that is defined statutory and inside informations the school ‘s mission, ends, plans, ways of step success, pupils served and methods of appraisal, is authorized to map. Most of the charter schools are granted for three to five old ages, however, the length of clip for every of charters are granted varies. This type of schools is accountably held to their patron ( province educational bureau, a local school board, university or other entity ) . It helps to adhere to the charter contract and to bring forth the positive academic consequences. It is obvious that the answerability is one of the gratings statements for the charter schools ; on the other manus, here is some grounds that is gathered by the United States Department of Education. This grounds claims that charter schools are practically non held to the high criterions of answerability in comparison with the traditional public schools. This statement could be refuted with the aid of analyzing the figure of those traditional public schools which were closed because of the hapless public presentation of their pupils on the trials at the terminal of a class or stop – of – class trials. Normally this sort of schools is allowed to remain unfastened on the status of the restructuring and new leading ( or frequently with no alterations at all ) . The advocates of the charter schools are asseverating that the schools do non hold an chance to frequently restructure ; they are merely closed down if their pupils show a hapless public presentation on the apprais als. The United States Department of Education ‘s findings agrees with the statements of NEA ( National Educational Association ) , although their inability to keep some other of import factors, the restrictions of different surveies does non give us an chance to be certain if the traditional public schools are better than charter schools or non. We can merely specify all those differences that we already mentioned above. Magnet Schools The last type of schools that we are traveling to analyze is magnet school. It is a public school that has a specialised course of study or class. The term â€Å" magnet † refers to the manner of how the schools draw pupils from across the common boundaries that are defined by governments ( school boards ) as the school zones that feed into some certain schools. We can run into magnet schools at the in-between school degree, simple school degree and at the high school degree every bit good. In the conditions of the decentralized instruction, some magnet schools are established by the school territory ; they are draw from the territory merely. Other magnet schools are set up by province authorities ; they could be draw from the multiply territories. There are besides some magnet plans within comprehensive schools ( several schools within one school ) . The bulk of the magnet schools are academically selective. There are two types of the magnet schools that are built on a base of the elect sporting plans and on the agricultural concern ( like animate being genteelness and agriculture ) . Some magnet schools provide the competitory entryway procedure ; they require interview, hearing or the entryway scrutiny. Other magnet schools use the lottery system or accept all pupils who apply ; besides they could unite some elements of lottery and competitory entryway. Most of the schools are concentrating on a peculiar country of the survey or on the certain subject ; other could hold a more general focal point. The focal point could be made on faculty members ( technology, mathematics, natural scientific discipline, societal scientific disciplines, and humanistic disciplines, executing of all right humanistic disciplines ) or they may concentrate on the vocational, agricultural, proficient instruction. Decision Here are some chief types of schools that are common in the state. Sum uping the differences between the public school, the magnet school and the charter school we can reason that they are about the support and authorising largely. Public schools are normally focused on a pretty broad country of surveies while magnetic and charter schools are seeking to hold a narrow focal point. However, we appreciate the broad pick of educational constitutions that are assisting our citizens to be good educated and to acquire more accomplishments and cognition.

Influence Of Cultural Differences On International...

2. The influence of cultural differences on international business negotiations In the negotiation practice, many negotiators often do not understand or pay attention to the important influence of the cultural importance of the negotiations. During the international business negotiating the process, some negotiators may have been aware that the different or hard to understand the concrete manifestation. However, some foreign negotiators, in order to maintain a harmonious relationship between the negotiations, they will pay attention to the similarities between the two cultures, while ignoring their differences. 2.1 Differences in verbal and nonverbal behavior There is a close connection between the language used by a nation and the national culture. In cross-cultural communication, the differences between American and Chinese culture will constrain negotiations and reduce the opportunity for achieving trade liberalization. For example, American is a typical low-context culture: most information is delivered in a clear and specific language or text (Nishimura, 2013). Its negotiators are highly praised for clear and direct communication. Therefore, in the negotiating process, Americans will directly state the desired conditions and requirements. On the other hand, Chinese, as the high-context culture, prefer to use indirect ways of expressing to convey and understand information (Nishimura, 2013). Chinese don t love to argue and speak obscurely. Also, keeping silence isShow MoreRelatedThe International Business Negotiations Influenced By Chinese And American Cultures And Differences743 Words   |  3 Pages Discussion on the international business negotiations influenced by Chinese and American cultures and differences Jialin Zhao CMN6060 Professor Stephen Novick October 26, 2016 Abstract Cultural negotiations are business negotiations with different cultural conditions. 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Analysis Of Renewables Or Bust And Its Effects On Our...

Renewables or Bust Many American cities have experienced the phenomenon of smog or haze at one point or another. This smog has led the general population, political leaders, and scientists to ask the question, â€Å"What produces this haze and what are the impacts on our health and environment?† (Fischetti). The average amount of energy consumed per person has dramatically increased over the past several hundred years (Christensen, 482). The prevalence of fossil fuel use in our world is a primary cause of these hazy conditions as well as increased pollutants in the environment which has leads to increased illnesses in humans (Fischetti). The prevalent usage of these types of fuels are the leading cause of many environmental and economical†¦show more content†¦Fossil fuels are a finite resource with rapidly depleting supplies, so they are sometimes referred to as non-renewables. The usage of these fuels across the globe is broken down as follows; 33% for oil, 25% for c oal, and 21% for natural gas. The combined usage of these types of fuels totals 79% of human energy consumption worldwide. The United States accounts for 20% of global consumption of these fuels (Christensen, 483). Coal, for example, is primarily used to feed coal fired power plants that provide electricity to our homes. Oil can be refined into gasoline to power our vehicles and is used in plastics, lubricants, and household items. Natural gas is used to power vehicles and heat homes and even our barbecues, in the form of propane (What Are Fossil Fuels Used For?). These resources are used in almost all aspects of our lives, they however pose many risks and have a negative impact on our environment. The combustion of coal creates a variety of environmental problems. Gasses such as nitrogen oxide, sulfur oxide, and carbon dioxide are emitted from coal power plants and into the air and soil (Christensen, 490). These emissions are potent greenhouse gasses that erode Earth s protective ozone layer and are a contributing factor to climate change (EPA). The Environmental Protection Agency also states, â€Å"A warming climate will bring changes that can affect our water supplies, agriculture, power and