Tuesday, December 24, 2019

Western Financial System versus the East Asian Financial System Term Paper

Essays on Western Financial System versus the East Asian Financial System Term Paper The paper â€Å"Western Financial System versus the East Asian Financial System" is a thoughtful example of a term paper on finance accounting. The development of economies worldwide is based on specific criteria; these criteria can be differentiated in accordance with the local ethics and culture, the position of a country in the international community and the resources available – funds and skilled employees – for the realization of the relevant projects. The financial crisis of 2007 of 1997 was used by many people in order to prove that eastern financial systems are not as strong as initially estimated by researchers. The current paper focuses on the examination of the merits of the Eastern Financial system towards its Western rival. The studies of Goodhart and Johnson – referring to the above systems – are critically discussed. It is proved that the Eastern financial system offers higher security – compared to the Western financial system. In this context, the views included in the study of Goodhart - that is supportive towards the Eastern financial system – are verified; the views of Johnson are important – in terms of the issue under discussion – and they are critically discussed in order to have more chances to highlight all aspects of these study’s issues. Assumptions are made in regard to the merits of both these systems but also the potential superiority of one of the – reference is made to the Asian Financial system; the views published in the literature in regard to the specific subject are also used – at the level that has been considered as important for supporting the arguments stated in the paper.Western and Eastern financial model in the study of GoodhartThe views of Goodhart on the Western and Asian financial system are based on the critical examination of certain aspects of these systems; particular attention has been paid on the responses of these systems to the crisis of 1997-98 but also to the recession of the period 2007-2009 – a recession that is still in progress.Goodhart notes that the ability of the Western (called also Anglo-Saxon) financial system and the Eastern financial system to respond to the crisis need to be evaluated by referring primarily to the structure of these systems; at the next level, the effects of these systems on the national economy can be identified. It is proved that the differences in these system’s potentials against financial crises can be explained based on these systems’ elements and roles in the context of a particular social, political and economic environment.In accordance with Goodhart the main weakness of the Anglo-Saxon model is the fact that ‘stability carries within itself the seeds of future instability’ (Goodhart, p.9); in the context of the Western financial system, the above fact has led to the high exposure of banks to risk by expanding leverage (Goodhart, p. 9). Of course, the activities of all financial institutions of the Western financial system are regulated by the rules of the Basel II – however, the existence of the above legislative framework had not the result expected; because of the above text, a Western financial system. The above problem is highlighted by Goodhart who notes that ‘the adoption of the pro-cyclical combination of Basel II and mark to market accounting served to hide the fragility of the over-extended financial and banking positions both from the regulators and from the regulated’ (Goodhart, p.9). Furthermore, existing regulation of firms that operate in the financial services sector – referring to the Western financial system – is not appropriately developed – in terms of the priorities set by its rules; in this way, the non-compliance with theIn the study of Goodhart, it is made clear that the responses of the Western financial system to a financial crisis can be explai ned by referring also to this system’s macroeconomic structure; the regulation of this system has been also regarded as being responsible for this system’s failure to face the crises of 1997-1998 and 2007-2009. The macroeconomic structure of the Western financial system is characterized by the key role of the executives – the power of these individuals is extended at such a level that their decisions can be differentiated from.The Asian Financial system is considered by Goodhart to be more stable – compared to the Western Financial system; Goodhart has tried to identify the value of the Asian Financial system by examining this system’s structure but also its practical implications – as they could be identified through studying the operational practices of the banks of 4 Asian countries – Japan, China, India, and Indonesia. It was revealed that the Asian Financial system should be preferred as it has two critical advantages – co mpared to its Western rival: a) a high percentage of the local banking system is owned and controlled by the state and b) the terms of lending to individuals and firms are closely monitored by the relevant authorities – a fact leading to the increase of the credibility of Asian Financial System (Goodhart, p.6); the comparison of the two systems, the Western and the Asian ones by Goodhart leads to the assumption that both these systems have their benefits and disadvantages; in any case, the Asian Financial system seems to be suggested by Goodhart as a financial system of high, it is suggested by Goodhart that a new – unified – system could be introduced meeting the requirements of both systems (the Western and the Asia ones).The view of Simon Johnson on Western and Eastern financial model – critical analysis of the article ‘Quite Coup’In the same context with Goodhart, Johnson has tried to identify the advantages and the weaknesses of the West ern and the Eastern financial systems; his study aims to explain the terms under which countries worldwide have to ask for the support of the IMF; it is at this point that the term ‘Eastern’ takes a different meaning – compared to the one used by Goodhart. More specifically, in accordance with Johnson, the governments in Eastern countries tend to use a specific practice: to develop expensive projects which are based exclusively on that the failures in using the capital borrowed can lead to severe turbulences; in the case of Russia it is noted that the country’s entrepreneurs borrowed a significant amount of money the last 5 years aiming to increase their commercial activities; however, the recession led to severe delays in all industrial sectors; the reduction of profits led to severe pressures for the repayment of the loans; and in this way, the borrowed capital has worked as a trap for the local investors. It is implied that the terms of borrowing need t o be carefully examined each time that the external funding is required for the achievement of specific business plans. Another example of the factors that can lead to a financial crisis is the one of US; in the specific case Johnson notes that ‘elite business interests—financiers, in the case of the U.S.—played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government’ (Johnson, 2009); again the crisis is not related with a specific financial system; the USA which is based on a Western financial model was proved unable to confront the crisis; at the next level, the expansion of the crisis has been quite rapid indicating the lack of mechanisms for protecting the market from such threats. Despite the crisis, the support of Johnson towards the Western financial model is clear; it is noted that the radical development of the financial services sector in the USA has been related with a series of factors incl uding ‘the monetary policy and relevant interest rates, the invention of securitization and credit-default swaps’ (Johnson, 2009); the above policies were appropriately structured and promoted; the financial development of the country was carefully planned – the failures related with financial products promoted by a specific team of individuals cannot be considered, in accordance to Johnson, as a key indicator regarding the potentials of the USA economy; on the contrary, in the case of eastern financial system – Johnson refers to the example of Russia – no similar basis for the development of the country’s economy seems to exist. Of course the financial policies of the two countries cannot be the same during to the geopolitical and cultural differences of the above regions; however, even under these terms, Johnson clearly supports the superiority of the Western financial system towards the Eastern financial system. At this point, Johnson is d ifferentiated from Goodhart who emphasizes the important characteristics of the Asian financial system.Western versus Eastern financial model – identification and evaluation of merits using the studies of Goodhart and Johnson and the literatureIn accordance with the studies of Goodhart and Johnson, the Western Financial System has the following merits: a) development of the financial system in a free market; this an advantage of the Western financial system highlighted by Johnson; in this market the development of commercial and financial activities is free – not controlled by an oligarch – a political system which is often identified in eastern countries in accordance with Johnson; the existence of a free market in the Western Financial system has been proved as related with risks; in fact, it was in this free market that the expansion of faulty financial products was permitted; the result was the crisis of the 2007 onwards – an extremely powerful crisis the effects of which are extremely strong compared to the effects of the crisis of 1997-1998 in Asia which did not negatively affect the global market at this level, b) regulation by specific rules the application of which can be controlled by relevant international authorities – referring to the Basel rules on the banking regulation; on the contrary in the eastern financial system no common regulatory framework can be identified among the countries that are based on the eastern (Asian) financial model; this merit of the Western Financial system is highlighted by Goodhart. However, the Basel rules and the rest of the rules regulating the financial services activities in the Western financial system are not used strictly by the individuals and firms that work on the financial services industry; in this context the existence of specific regulation cannot be actually considered as a merit of the Western Financial system – a fact also noted by Goodhart who supports the su periority of the Eastern financial model as having fewer chances to lead to crises like the one of 2007-2009.As for the Asian Financial system, its merits were highlighted in the study of Goodhart; no comments on the potential positive aspects of the Eastern Financial system were made by Johnson; using the study of Goodhart the following merits of the Eastern financial system can be identified: a) the market is not depended on the initiatives of individuals – executives; rather the state has the control of the market; this means that initiatives that could threaten the national economy are likely to be avoided in the Eastern Financial model; b) lending is not approachable by all; criteria are set ensuring the protection of the system by severe turbulences – a risk that was not avoided in the US market which was heavily depended on faulty financial products – referring mostly to the subprime products; as the repayment of loans in the US market started to present delays the pressures on the local market became extremely strong; in the Eastern financial system this risk is limited since the level of lending is closely monitored; a potential delay in the repayment of loans cannot threaten the global economy – like in the case of crisis that first appeared in the US market which is based on the Western Financial System.It is concluded that the Eastern Financial System has more advantages compared to the Western Financial System; the risks involved in the Eastern Financial System are low – compared to the risks involved in the Western Financial System. This fact is also highlighted in the literature; in accordance with Noble et al. (2000) two are the most important merits of the Eastern Financial system: ‘the security and the community’ (Noble et al., 2000, p.14); on the other hand, Henke et al. (2000, p.158) emphasize on the importance of the control of the state on the activities developed in the context of the Easte rn Financial market. Another significant advantage of the Eastern Financial model seems to be its dependency ‘on bank loans than on securities markets’ (Caprio, 1998, p.4); on the other hand, the successful ‘transition to a market economy model’ (Ariff et al., 2000, p.5) seems to be a significant advantage for the countries that are based on the Eastern Financial System; an example of such country is China which managed to effectively respond to the transition of its economy into a market-economy mode. On the other hand, Gup (2000, p.85) notes that the countries based on the Eastern Financial system are able to stabilize the performance of their economy – even against too severe turbulence in the international market – when they introduce the necessary regulatory reforms (Mishkin, 2007, p.63). The risk for corruption and the moral hazards in the Eastern Financial system should not be regarded as exclusive disadvantages of this system – as noted by Lee (1998, p.14); in the Western financial system also such phenomena are common – as proved through the current crisis. In fact, the Eastern financial system can lead to the increase of the stability of the local economy – only under the terms that measures are taken for the limitation of corruption and the introduction of appropriate regulatory rules (Hassan et al., 2004, p.40).ConclusionThe crisis of the period 2007-2009 and the previous crisis of the period 1997-1998 have been used as events indicating the failures of financial systems worldwide; the first crisis started in a market based on the Western financial system; the second crisis is related with the Eastern Financial system. It seems that both these systems have strengths and weaknesses; in the context of the modern market, the comparison of these systems – using the studies of Goodhart and Johnson and the literature – has led to the assumption that the Eastern Financial system sh ould be preferred – instead of its Western rival; the reasons on which this suggestion is based are analyzed in the previous section. The Eastern financial system is offered for higher security – due to the intervention of the state – and higher stability – due to the limitation in the loans available in the market (Siddiqui, 2008, p.57, Lastra, 2004, p.225); it has been proved that the appropriate reform of the regulatory framework of the Eastern Financial system would increase the superiority of this system towards the Western Financial system which is highly regulated but no effective mechanism exists for the control of the alignment of the investment and banking activities with the terms set by the relevant laws.

Monday, December 16, 2019

Statistical Applications Free Essays

The pie chart shows percentage among adults with diagnosed diabetes receiving treatment of insulin or oral medication. It is normally used to present the data. I believe that this was a proper graph used to present the data. We will write a custom essay sample on Statistical Applications or any similar topic only for you Order Now The information is clear. The data was presented in a good visual that I could recognize the patterns and trends. The colors used to differentiate type of treatment are helpful. Was this the best way to display the data? What other types of graphs could have been used? This is the most appropriate chart for this type of data presentation. The Pie chart was the best way to present and display the data. Another type of graph or chart that could have been used is the bar graph. Both are graphs showing proportion. They produce the same information just in different forms Is the scope and scale of the graph appropriate? Why or why not? The scale of the chart was appropriate for the article and how it was presented. This article was part of a journal article and the chart had to be inserted into the article so the scale was appropriate. Does the chart or graph support the findings in the article? Why or why not? The pie chart was described clearly in the article with percentage and the type of treatment. The article also unclouded the source of data, it has the credential to the reader. How to cite Statistical Applications, Papers

Sunday, December 8, 2019

Martin Luther King vs. Thoreau free essay sample

Written over 114 years after Henry David Thoreau’s essay â€Å"Civil Disobedience†, Martin Luther King wrote his most famous essay; â€Å"Letter from a Birmingham Jail. † In the times of Henry David Thoreau there was only one topic of politics in the United States, slavery. Many southerners wanted to keep slavery while many northerners were against it. Henry David Thoreau was a white northerner that was against slavery, and he was willing to go to jail for it. He proved that in writing his famous letter. In the letter Thoreau describes what it means to be civilly disobedient. In Thoreau’s terms, Civil Disobedience is standing up peacefully against laws you do not think are moral. He was civilly disobedient in not paying poll taxes for over six years because he knew the money was used to support slavery. Martin Luther King was a great civil rights leader that lived in the period of the Civil Rights Movement. We will write a custom essay sample on Martin Luther King vs. Thoreau or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page King went to jail for a peaceful march against racial hatred after he was specifically told not to march. He was put in a jail in Birmingham for eight days; this is when he wrote his famous letter in response to a letter from eight Alabama clergymen. He was arguing against racial hatred and used the effects of ethos, pathos, and logos to attain his argument. Although Thoreau is formal with his writing and uses plenty of logical reasoning to attain his point, King is more like likely t move the readers due to his ability to reach your emotional side, and his credibility as a leader of the Civil Rights Movement. Thoreau was not the best with pathos, but he did do some things well with his emotional appeal. At one point in the essay, he argues that people are more worried about money and their jobs than they care about humanity. Thoreau says, â€Å"Merchants and Farmers here, who are more interested in commerce and agriculture than they are in humanity†. This line effectively reaches the emotional side due to its speaking of humanity. Overall, Thoreau is not good at involving emotional appeal in his essay. King does a fantastic job at reaching the emotional side. King talks about his family and fellow brothers and sisters being treated with pure hatred. He states, â€Å"I doubt you would have so warmly commended the police force if you had seen its dogs sinking teeth in the unarmed, nonviolent Negroes†. He makes people realize that the police force they have been honoring may not be as good of people as most people presumed. It takes a lot of hatred for people to order attack dogs to attack a nonviolent, unarmed man, no matter what his skin tone may be; it is pure hate. King still did well in his essay with ethical appeal, but this was Thoreau’s forte. Thoreau uses ethical ideas and makes statements that really make the reader question their beliefs prior to reading his essay. â€Å"But Paley appears never to have contemplated those to which the rule of expediency does not apply, in which a people, as well as an individual must do justice, cost what it may. † This excerpt shows the need for justice no matter what the cost is, what the laws of the present time may be, but you need to do whatever is right. King uses ethical appeal well in a couple places of his essay. One of these places is where King says, â€Å"Even so I am sure that if I had lived in Germany at the time, I would have an idea†. King is proving that the hatred in the United States is so atrocious, that even if he lived in a place with equal rights among men such as Germany, the hatred would still be palpable from all the way across the world. King and Thoreau both wrote exquisite essays, but overall Kings ability to reach the emotional side wins in the end. Although Thoreau was very logical and had an outstanding ethical appeal, King reached all inner emotions altering peoples’ minds change from their hatred. In the end, both the issues of slavery and the issues of social hatred have been resolved for the most part. Slavery was the predecessor to the Civil Rights Movement, so in turn Martin Luther King could not have possibly done what he did without people like Henry David Thoreau. People like Thoreau gave slaves their freedom in the first place, which gave them the opportunity to fight for their rights; Martin Luther King heard that message loud and clear when he became the most prestigious member ever of the Civil Rights Movement.