Business analysis Essay Example | Topics and Well Written Essays - 1000 words

Business analysis - Essay Example The current ratio which is well above the benchmark of 1 should not be viewed as a healthy sign because the company is having major issues with its receivables and inventory management. The company has large amount of receivables pending resulting in high receivables days and the situation is the same for the company’s inventories. The company has good asset turnover but it is also declining over the period from 1993 to 1995. The company has a negative profitability in 1994 and 1995 because of its inability to generate profits. Though the company paid dividend in 1993 and 1994 the amount due from stockholders has been significant which could further dampen the company’s capital position. The financial ratios have been attached to this report as Appendix II. The company’s operating cash flow has declined sharply in 1995 leading to a negative figure of DM494,000 which surely have implications for the long term survival of the company if it is not able to recoup its business by altering its marketing and operating strategies. Marketing Analysis Haefren Baum is a home furnishing retailer which is engaged in selling high quality home furniture products of a German manufacturer Wiegandt GmbH Cologne. The understanding of the high-end furniture market suggests that the demand in this market is cyclical which is affected by two major factors – consumer buying confidence and also by the overall economic conditions. Due to the fall in the German economy during the year 1993 i.e. GDP indicated a negative growth of 1.2% the demand for furniture dropped and sales deteriorated. Haefren Baum’s sales also declined after 1993 showed as YoY decline of -19% (1994) and -5% (1995). In order to tackle the challenges the company cut down its pricing and also opened up new outlets Rhineland suburban areas however due to the competition attracting to the market it is difficult for a small retailer like Haefren Baum to survive for long as it is also fa cing problems with generating profits and maintain a strong cash position (Crane and Millett). Operations Analysis Since the company sells home furniture of Wiegandt GmBH Cologne therefore the amount payable to the company has reached DM 54,017.18. From the analysis it could be indicated that the operational efficiency of the company is becoming weak as the number of days that receivables are due for payment and the inventory held in its stock are increasing. Furthermore, the company is taking longer period to pay off its liabilities. The company has generated loss in 1994 and 1995 which suggests that the company is facing major difficulties in devising its strategies to coup up with the tough market conditions prevailing in Germany. Due to expansion of outlets the company’s borrowing has increased significantly and no positive outcome has been achieved. The credit department of the company must lay off loans and sell of non-profitable outlets to cut down pressure on its cash position. Appendix I: Cash Flow Statement Cash From Operating Activities 1994 1995 DM ‘000s DM ‘000s Net Profit -16 -55 -16 -55 (Increase)/Decrease in Receivables -386 35 (Increase)/Decrease in Inventory 8 -8 Increase/Decrease in Accounts Payables 8 88 Deferred Charges 32 0 Miscellaneous Accruals 74 -331 Current Maturities on Long-Term Debt 327 -223 Estimated Federal Income Tax -104 0 -41 -439 -57 -494 Cash Flow from Investing Activities Sale / (Purchase) of Net Buildings, Fixtures and

Strategies Of Teaching In Indian Higher Education Research Paper

Strategies Of Teaching In Indian Higher Education - Research Paper Example The scarcity in terms of infrastructure, education standards and some vital factors has instigated the door to be unlatched for the foreign universities. The Cardiff University (UK) in particular has been considered as the frame of reference in view of the spectacular learning ambiance. Cardiff University is not only known for the outstanding ranking in the UK but also for the global reputation in the research field and teaching. Having vast experience in the Cardiff University, it is really a wonderful opportunity on my part to deliver some worth mentioning narration of the education on the steadfast role. MBA by far is the most intriguing and lucrative post graduation course in recent years. It would really be an injustice to compare it with the other academic and professional course. The popularity that it has gained is enormous but definitely not valueless as it strives to blend just the right mix of the professional attitude in the future to be managers. MBA course tends to conv erge towards the professional atmosphere after the studies by enforcing the practical implementation of theoretical knowledge. It integrates the essence of the Cardiff Business School in Vidya Vikas University to reinforce a very strong global foundation for the business school in Indian territory. Part One starts with the evolution of the education system in India. This basically gives a brief history of Indian education system gradually transcending to the higher education system. Then the dissertation deals with the evolution of the global context with special reference to the US and UK education scenario, as the Church played a critical role in the development of education abroad.

PatientOS installation guide

PatientOS installation guide 1. Overview 1.1 Process The basic steps to installing PatientOS are divided into the backend system and front end client a) Backend System Install the PatientOS software base version. Install the PatientOS updater software. Install and create a PostgreSQL database version 8.2 or higher. Import the PatientOS database contents. Start the PatientOS application server. b) Frontend Client Install the PatientOS software. Install the latest software updates. Start the PatientOS client. 1.2 Definitions POS Refers to the PatientOS software as a system. Java Programming language developed by Sun PostgreSQL An Open Source (free) database server, an alternative Oracle, SQLServer, etc. Application Server The backend J2EE server which clients connect to. Client The rich (fat) client graphic user interface (GUI) with which the users interact. 2. Software Installation 2.1 PatientOS Download 2.1.1 Windows The PatientOS download is hosted at Sourceforge. Here is the direct URL Windows Base Install http://downloads.sourceforge.net/patientos/PatientOS-0.97-Setup.exe PostgreSQL Database Server Software http://downloads.sourceforge.net/patientos/postgresql-8.3.7-1-windows.exe PatientOS Demo Database Contents http://downloads.sourceforge.net/patientos/demo-0.97-database.zip http://downloads.sourceforge.net/patientos/demo-0.97-datafiles.zip Links from the website redirect to sourceforge where it is often difficult to find the download link look for the text use this direct link circled in red below. 2.2 PatientOS Base Installation 2.2.1 Installer Run the downloaded setup executable PatientOS-0.97-Setup.exe and follow the prompts a) Installer Language Selection The first language selection prompt is for the installer language not the PatientOS language. b) Destination Directory The destination directory defaults to Program Files. The directorys disk should reserve at least 750MB space for the installation. A client only install will require less space, the server will grow significantly larger. The target directory defaults to 0.97. It would recommended to install into a version agnostic directory such as C:Program FilesPatientOSdemo or C:Program FilesPatientOSproduction However for the rest of the document we will assume the path installed as C:Program FilesPatientOS.97 c) Startà  Programs By default the software shortcuts will be stored in Start à   Programs à   PatientOS à   0.97 2.3 PostgreSQL Installation 2.3.1 Installer Run the downloaded PostgreSQL installer postgresql-8.3.7-1-windows.exe Accept the default directory to install PatientOS into. The super user password is critical to remember or write down it is required to administer the databases. Use the default port 5432. Use the default locale. Press next and finish to install the database software. 3. Database Installation 3.1 Create Database Before the PatientOS can start properly a database is needed with a username and password the application server can connect to. There also needs to be PatientOS specific contents in the database. 3.1.1 PGAdminIII The PostgreSQL installation also installs a graphic tool to manager the PostgreSQL databases. Use Start à   Programs à   PostgreSQL à   pgAdmin III to start the tool. Double click on the single line PostgreSQL Database Server to connect to the database. You will be prompted for the postgres password entered during the PostgreSQL installation. 3.1.2 Create Database Login Select Login Roles and right click and choose New Login Role. Enter demopos for the username, password and check off all the privileges. 3.1.3 Create Database Select Databases and right click and choose New Database. Enter demopos for the database name and user name. The encoding will need to match the encoding selected for the installation. If you have an old installation need to drop the existing database. Stop the application server and execute the following commands. cd C:progra~1patientos.97serverdatabase C:progra~1postgresql8.3binpsql -U demopos demopos drop schema public cascade; create schema public; q 3.2 Import PatientOS Database Contents Load a Demo Database 3.2.1 Import PatientOS Demo Database and Demo Files The demo database has binary files that are database specific. Download and unzip the corresponding database files and database contents http://downloads.sourceforge.net/patientos/demo-0.97-datafiles.zip Unzip and overlay the files in the data directory C:progra~1patientos.97serverdata http://downloads.sourceforge.net/patientos/demo-0.97-database.zip Startà  Runà  cmd cd desktop C:progra~1postgresql8.3binpsql -U demopos demopos < demo_database.sql See forum for information on renaming the demo facility to a facility of your choice. 4. System Startup 4.1 Installation It is assumed that the Windows, Linux or other Installation Guide has been followed and that you have a) PostgreSQL database installed b) Import PatientOS database contents c) Installed the application server software d) Installed the client software 4.2 Application Server The application server is JBoss version 4.2.0 GA with the PatientOS specific libraries and configuration files. The application server is required to be running before the client can start. The application server can run on the same server as the client. 4.2.1 Appserver shell script The windows installation creates a script appserver.bat with a shortcut in Start à   Programs à   PatientOS à   à   Start Application Server (first) The working directory must be the same as the script. Start the application server. For a successful installation the last line printed to the shell is Instances Found 0 4.2.2 Service The application server runs perpetually and in a production setting should be configured as a service. The application server takes 20 seconds to start on a 2 ghz processor. Once started the server typically only needs to be restarted for upgrades. On windows this is the first time the server has been installed you may need to press Unblock for this dialog: 5. Client Startup The client can run on the same server as the application server by default. To have the client connect to an application server running on a remote host edit the shell server patientos.bat On windows right click on the shortcut called Start Client (second) and select Edit. This should open an editor where you can change the script. On linux cd /patientos/0.97/client/bin vi patientos.sh 5.1.1 Client shell script To connect to a remote host change localhost to the hostname or IP address of the server running the application server. 5.2 Login Login to the client with demo/demo to access the system as a privileged physician admin/admin to access the system as an administrator

Cold Mountain: Frasiers Archetypal Journey Essay -- essays research pa

The archetype of the journey is seen in Charles Frazier’s novel Cold Mountain, most clearly through experience Inman has wandering back to Cold Mountain. The journey archetype sends the hero in search of some truth to restore order and harmony to the land. The journey often includes the series of trials and tribulations the hero faces along the way. Usually the hero descends into a real or psychological hell and is forced to discover the blackest truths. Once the hero is at his lowest level, he must accept personal responsibility to return to the world of the living. Inman’s trip fits this description very well in some ways and not in others. It could be said that Inman’s search for truth is his desire to be back home. He has been disillusioned by the war. He saw horrible scenes daily and fought for his life. By coming home to Ada and his mundane life is a welcome constant for him in a world he has recently determined to be wild. He believed that once he had rea ched his destination, order in his personal world and soul could begin to return to normal. In accordance with the definitions of the archetype journey, Inman goes through a great deal angst and tribulations. He has practically starved many times, been mugged, and fired upon. This strife is culminated when he his betrayed and shanghaied, marched nearly to death, then shot and left for dead. He is buried with a thin layer of dirt in a mass grave, and spends half a day under ground with the dead. This is his low point, his personal hell. At this point he even considers not uncovering himself and allowing the easy death to occur. For such a logical and even headed man this is particularly extreme thought. But he eventually finds the will power to hoist himself out of the grave to once again take up road. Finally he gets to the house and restores order to his metaphysical kingdom, coming to terms with many of his thoughts. Ada goes through a more mental archetypal journey. She has to fi nd manageable independence, an aspect development of which she had always been deprived. Her low point was at the beginning of the book when she realized that she no longer had the money that once had enabled a work-free life style. At the beginning, she has no idea what to do or what she even wants. Once Ruby comes, she begins to come to important self-realization about the pettiness of her past life and how she is no lon... ... the greatest foils to each other. When one reads of Ruby’s extreme incredible work ethic and practicality in every matter, even towards bird-watching (she uses migratory patterns to plant seasonally), one understands that she has lived in harsh conditions and foolishness was not an option. Once contrasted with her father and his physically unproductive lifestyle, one may come to view her as a calculating robot. On the other hand, Stobrod may look as though he has a far worse work ethic than he actually does wen contrasted against his daughter. Similarly, this was the dynamic of Ada’s relationship to Ruby when Ruby was first introduced. Inman, the rational, moral, and selfless farmer boy and Veasy, the lecherous, self-centered preacher serve as foil to one another. When the pair is together Inman seems so strait laced and moral, thinking every aspect out well in advance, then taking the most sensible route. Veasy on the other hand is made to look even more of a lech erous buffoon, when he, who has just had relations with Laura Foster, solicits the massive Tildy for sex in the tavern while Inman, the lonely former-soldier who has not been with woman for a long time remains celibate.

Paragon Tool

Executive Summary Considering the situation that Paragon Tool is currently in, with uncertainty regarding company’s future, management in disagreement and the lack of tangible information regarding MonitoRobotic’s acquisition it is recommended that Paragon Tool, take a week, gather all of senior management and develop a concrete and agreed upon strategy regarding Paragon Tool’s future growth strategy. Once such a strategy is formulated, if the service business and MonitoRobotic’s fit with these plans, then Nickolas should take the next step in conducting the necessary due diligence to determine that the MonitoRobotic acquisition price and it’s culture will fit with Paragon Tools. Current Situation While Paragon Tool Company seems to be a healthy machine tool manufacturing company surviving in a tough industry, a primary concern for Nickolas Anaptyxi, CEO, is continued growth for the company. Paragon’s current tool manufacturing line is surviving in a fairly saturated market, but not exactly thriving. Mr. Anaptyxi’s primary goal since his start at Paragon is to grow the then small company through acquisitions. The company continues to fund more and more acquisitions while continuing to show diminished profits. While the CFO continues to debate with the CEO, Nick Anaptyxi, Mr. Anaptyxi’s strategy continues to be growth for Paragon through frequent acquisitions while continuing to show poor margins to investors. His belief is that the cost now will pay off in the future. The current situation that Paragon faces is that the recently added line of business of services (repairs, service calls, etc. ) has been experiencing losses which has been pulling down its previously well performing tool manufacturing line. Mr. Anaptyxi believed that a key way for this slow growing and cyclical company to grow and thrive in the difficult market is to expand its market base by offering a service line to complement its tooling business. The CEO has to explain to the company’s investors that it will take time for the company to see a return on its investment in the service sector. Potential New Acquisition In the interim, Paragon has been recently courting a technology company, MonitoRobotics, that focuses on the ability to identify manufacturing malfunctions much more quickly than before through the services of software and technology. While contemplating this relationship, it is made known to the CEO that a major competitor of Paragon is going in on a hostile bid for MonitoRobotics Company. The acquisition of MonitoRobotics would essentially double Paragon’s sales revenue collaborating on remote servicing technology for machine tools. A big plus is that this acquisition would give Paragon a presence in this type of robotic diagnostic business while at the same time, blocking a major competitor from doing the same. The CEO believes this collaboration would greatly benefit the growth of Paragon by offering this additional service to its customers. Mr. Anaptyxi now needs to step up his decision and make his next move. The company first needs to understand that this possible acquisition is more than just a move to attempt to grow sales revenue. It is more a strategy to reposition the company into a more profitable and growing line of business that compliments its existing tool manufacturing line. The company has to make sure it is making a well researched decision with sufficient due diligence versus making a knee jerk decision based upon the threat of the competitor’s impending hostile bid. They need to consider if the company has enough management support and staff to succeed at the overhaul of the company from manufacturing to technology. Executives need to not only be concerned about the investors’ position on the acquisition and continued diminished returns, but on the opinion and attitude existing staff has and their related motivation, whether the culture’s of the two companies can mingle into one. The top management is divided on their stance regarding the acquisition. An effort must be made to get the entire team on the same page or else, half of the team will lose their motivation regardless of the decision made. The acquisition has to be at a fair price and make business sense. Analysis must be done to make sure that Paragon’s existing service line will become profitable in the future, if not, the acquisition of an additional service line that may be unprofitable may mean death for Paragon. Details such as the acquisition costs and performance figures would have been welcoming information in determining if MonitoRobotics’ acquisition makes business sense. However given the lack there of, it is difficult to determine what kind of hardship the acquisition would be on Paragon. The description from the CFO makes it sound like it may be tough on the company’s capital if the deal where to go through. Although the CEO states that the CFO’s style compliments his own style, their differences in strategies and overall mindsets may prove disastrous for the company. The fact that the CFO thinks the company should consider selling of their existing services line while the CEO is talking about acquiring an entire company for their service lines makes not synergy between the two. They may spend more time spinning their wheels arguing over viewpoints than making progress in the company’s growth. Additionally, the CEO’s concern that he may lose the CFO if the deal is finalized should not be a showstopper for the CEO if the deal is in the best interests of the company. Recommendation Before a decision with such magnitude can be made, Paragon Tool must understand its current capabilities. After understanding what it’s management, financial and production capabilities are, then after determining the company’s growth strategy, Mr. Anaptyxi and the rest of Paragon Tool will know if MonitoRobotics is the right fit for Paragon Tool. There exists too much confusion and disagreement between management to make a decision, and even if Mr. Anaptyxi, were to force the acquisition upon his management, as it stands now, Paragon Tools lacks the management team to follow through on the merger process. While MonitoRobotics feels like a can’t miss opportunity, with the services business becoming a booming industry, there will be other opportunity to either acquire smaller service businesses or give time to grow the service business within.

China and Usa: a Comparison of Their Monetary Policies

University of International Business and Economics China and USA: A comparison of their Monetary Policies. Mid-term Project School of International Trade and Economics BY Rebecca Bogiri Professor: LIN GUIJIN Beijing, China 2 December 2009 China and USA: A comparison of their Monetary Policies. By: Rebecca Bogiri December 2009 Abstract The monetary policies of USA and China is analyzed here from the perspective of their implementing bodies, their choice of instruments, and their means of setting their interest rates. The analysis reveals that there are immense differences between the two countries resulting from the nature and degree of influence from their respective domestic political systems. The paper concludes that China has a complex political economy that represents a hybrid of private ownership and state control. Therefore unlike the USA, its monetary policies are subject to political influence. Keywords: Monetary policy; Monetary policy instruments; Balance Sheet; China; USA Author’s email: becky. [email  protected] com ContentsPage Abstract †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 1 Introduction †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 3 USA Monetary Policy †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 3 China Monetary Policy †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 7 Comparison of China and USA’s monetary policies †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 9 Conclusion †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã ¢â‚¬ ¦Ã¢â‚¬ ¦. 10 References †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 11 1. Introduction Monetary Policy is the process by which the government, central bank, or monetary authority of a country controls (1) the supply of money, (2) the availability of money, and (3) the interest rate, in order to attain a set of objectives oriented towards the growth and stability of the economy. This paper refers the above theme to two countries: China and USA. As such, there are three broad objectives. The first is to discuss monetary policy generally as carried out in the USA. The second is to discuss monetary policy generally as it is carried out in China. The third is to compare and analyze the way monetary policy is implemented in the two countries. 2. USA Monetary Policy How is the Federal Reserve structured? The Federal Reserve System (called the Fed, for short) is the nation's central bank. It was established by the Federal Reserve Act[1] and consists of the Board of Governors in Washington, D. C. , and twelve Federal Reserve District Banks. The Congress structured the Fed to be independent within the government. Therefore although the Fed is accountable to the Congress and its goals are set by law, its conduct of monetary policy is insulated from day-to-day political pressures. This reflects the conviction that the people who control the country's money supply should be independent of the people who frame the government's spending decisions. What makes the Fed independent? Three structural features give the Fed independence in its conduct of monetary policy: the appointment procedure for Governors, the appointment procedure for Reserve Bank Presidents, and funding. Appointment procedure for Governors:  The seven Governors on the Federal Reserve Board are appointed by the President of the United States and confirmed by the Senate. Independence derives from a couple of factors: first, the appointments are staggered to reduce the chance that a single U. S. President could â€Å"load† the Board with appointees; second, their terms of office are 14 years–much longer than elected officials' terms. Appointment procedure for Reserve Bank Presidents: Each Reserve Bank President is appointed to a five-year term by that Bank's Board of Directors, subject to final approval by the Board of Governors. This procedure adds to independence because the Directors of each Reserve Bank are not chosen by politicians but are selected to provide a cross-section of interests within the region, including those of depository institutions, nonfinancial businesses, labor, and the public. Funding:  The Fed is structured to be self-sufficient in the sense that it meets its operating expenses primarily from the interest earnings on its portfolio of securities. Therefore, it is independent of Congressional decisions about appropriations. How is the Fed â€Å"independent within the government†? Even though the Fed is independent of Congressional appropriations and administrative control, it is ultimately accountable to Congress and comes under government audit and review. Fed officials report regularly to the Congress on monetary policy, regulatory policy, and a variety of other issues, and they meet with senior Administration officials to discuss the Federal Reserve's and the federal government's economic programs. The Fed also reports to Congress on its finances. Who makes monetary policy? The Fed's FOMC (Federal Open Market Committee) has primary responsibility for conducting monetary policy. The FOMC meets in Washington eight times a year and has twelve members: the seven members of the Board of Governors, the President of the Federal Reserve Bank of New York, and four of the other Reserve Bank Presidents, who serve in rotation. The remaining Reserve Bank Presidents contribute to the Committee's discussions and deliberations. In addition, the Directors of each Reserve Bank contribute to monetary policy by making recommendations about the appropriate discount rate, which are subject to final approval by the Governors. Objective of Monetary policy Monetary policy has two basic goals: to promote â€Å"maximum† sustainable output and employment and to promote â€Å"stable† prices. These goals are prescribed in a 1977 amendment to the Federal Reserve Act. In the long run, the amount of goods and services the economy produces (output) and the number of jobs it generates (employment) both depend on factors other than monetary policy. These factors include technology and people's preferences for saving, risk, and work effort. So, maximum sustainable output and employment mean the levels consistent with these factors in the long run. But the economy goes through business cycles in which output and employment are above or below their long-run levels. Even though monetary policy can't affect either output or employment in the long run, it can affect them in the short run. For example, when demand weakens and there's a recession, the Fed can stimulate the economy temporarily and help push it back toward its long-run level of output by lowering interest rates. That's why stabilizing the economy, or smoothing out the peaks and valleys in output and employment around their long-run growth paths—is a key short-run objective for the Fed and many other central banks. USA Federal Reserve – Balance Sheet |ASSETS |LIABILITIES |Gold and Foreign Exchange |Currency | | |Held by public | | |Vault cash | |Federal Reserve Credit |Bank Deposits | |Loans & Discounts | | |Government Securities | | |Other credits | | Source: Federal Reserve Bulletin, May 1996. Monetary policy instruments The Federal Reserve has three instruments for controlling the money supply. They are: 1. Open Market Operations 2. The discount rate; and 3. The required reserve ratio. When using Open market operations, the Fed buys or sells government securities to affect the leve l of the money supply. For example, if the Fed wishes to increase the money supply by $2 million, it will purchase government securities worth $ 2 million. The Fed’s assets increase by $ 2 million under the securities heading. In order to pay for the government security, the Fed writes a check on itself. In return for the bond, the seller receives a check instructing the Fed to pay the seller $ 2 million. The seller then takes the check to his bank, which credits the depositor with $ 2 million, and then deposits the check at the Fed. The bank has an account with the Fed, which is now credited with $ 2 million. Thus the Fed’s liabilities increase by $ 2 million under the heading of bank deposits, as the commercial bank has just increased its reserves by $ 2 million which are held by the first instance as a deposit at the Fed. Another monetary policy instrument used to affect the level of the money supply is the Discount rate, which is the interest rate charged by the Fed to banks that borrow from it to temporary needs for reserves. Increasing the discount rate discourages banks from borrowing from the Fed, while lowering the rate encourages banks to borrow from the Fed and thus increase the money supply. The required reserve ratio refers to the percentage of total deposits that the Fed requires individual financial intermediaries to keep at the Fed as reserves. The significance of the required reserve ratio is that it affects the money multiplier, and thus the level of the money supply. For example, if the Fed wants to increase the money supply, it can do so by reducing the required reserve ratio. Because there are now less reserves and more money is available for the banks to be able to meet their customer’s demand for cash. This increases the money multiplier, which also has a positive effect on the level of the money supply. Required reserves do not pay any interest, so increases in the required reserve ration has undesirable side effects on bank profits. Open market operations are nearly always the favored tool of choice by the Fed. The Fed Open Market Operations in 2008 summarizes all monetary policies and tools used by the Fed for that year. The two tables below shows the changes in the federal funds target rate, and the primary credit rate, and the interest paid on the required reserves and excess reserve balance.. These were operational measures taken by the Fed to influence the Federal funds rate. It is evident that the Fed rapidly and continually decreased the federal funds rate and the primary credit rate throughout 2008. Furthermore, on October 8th 2008 the Fed started to pay interest on despository institutions’ required and excess reserves balances as authorized to under the Financial Services Regulatory Relief Act[2]. [pic] [pic] 3. China Monetary Policy Body in charge of Monetary Policy: Monetary policy in China is conducted by the People’s Bank of China. Article 12 of the Law of the People? s Republic of  China  on the People? s Bank of China provides † the People? s Bank of China is to establish a monetary policy committee, whose responsibilities, composition and working procedures shall be prescribed by the State Council and shall be filed to the Standing Committee of the National People? s Congress. The Monetary Policy Committee shall play an important role in macroeconomic management and in the making and adjustment of monetary policy. â€Å" Rules on Monetary Policy Committee of the People? s Bank of China stipulates that the Monetary Policy Committee is a consultative body for the making of monetary policy by the PBC, whose responsibility is to advise on the formulation and adjustment of monetary policy and policy targets for a certain period, application of monetary policy instrument, major monetary policy measures and the coordination between monetary policy and other macroeconomic policies. The Committee plays its advisory role on the basis of comprehensive research on macroeconomic situations and the macro targets set by the government. The Monetary Policy Committee is composed of the PBC? Governor and two Deputy Governors, a Deputy Secretary-General of the State Council, a Vice Minister of the State Development and Reform Commission, a Vice Finance Minister, the Administrator of the State Administration of Foreign Exchange, the Chairman of China Banking Regulatory Commission, the Chairman of China Securities Regula tory Commission, the Chairman of China Insurance Regulatory Commission, the Commissioner of National Bureau of Statistics, the President of the China Association of Banks and an expert from the academia. The Monetary Policy Committee performs its functions through its regular quarterly meeting. An ad hoc meeting may be held if it is proposed by the Chairman or endorsed by more than one-third of the members of the Monetary Policy Committee. Objective of Monetary policy: The main objective of the Chinese monetary policy is to maintain the stability of the value of the currency (the Renminbi), and thereby to promote economic growth. People’s Bank of China – Balance Sheet ASSETS |LIABILITIES | |Credits to FI |Deposits of FI | | |Central Bank Reserves | | |Excess Reserves | |Foreign Exchange Reserves |Central Bank Bills | |Securities |Deposits of Treasury | | |Currency in Circulation | Source: AE502 Macroeconomic Analysis Monetary Policy Instruments The People’s Bank of China in conducting Monetary policy has several instruments at its disposal which include: 1. The reserve requirement ratio 2. The Central Bank base interest rate 3. Rediscounting 4. Central Bank Lending 5. Open Market Operations 6. Other policy instruments as specified by the State Council In essence, the monetary instruments listed above correspond to the descriptions given under the Fed’s monetary policy heading. However, the main tool of choice for the PBC is the reserve requirement ratio. For example, in the PBC 2008 Annual Report on Monetary Policy it was reported that in order to sterilize excess liquidity in the first half of 2008, the reserve requirement ratio was decreased cumulatively by 3 percentage points on 5 occasions. Furthermore, a lower required reserve ratio was applied to rural credit cooperatives (RCCs) and financial institutions in the quake-hit areas. Furthermore, in the second half of 2008 with the heightened international turmoil and in order to ensure ample liquidity in the banking system, the PBC further reduced the required reserve ration of financial institutions on another four occasions resulting in a cumulative decrease of 2 percentage points for large financial institutions, and a cumulative decrease of 4 percentage points for smaller financial institutions. According to PBC calculations, by the end of 2008 a total of 800 billion yuan of liquidity was released into the economy. The choice of the reserve requirement ratio as the mail policy instrument is not coincidental to China which runs a high current account surplus. There is a large and growing demand for the RMB, and to maintain the RMB at the desired level the PBC issues RMB to meet this demand thereby increasing the money circulating in China. To keep inflation and economic growth under control, the PBC sterilizes its foreign exchange market interventions by buying back some of the RMB it issued to buy US dollar. In particular, it does so by selling low yield government securities to state-owned banks. So far, the banks have been able to absorb those low yield bonds in part because the interest rates paid on them bank deposits are also maintained at artificially low rates. Nonetheless, the increases in foreign reserves are not fully neutralized. Over the last five years broad money supply in China has been growing at above 15% per annum while real economic growth has averaged about 10. 5%. [3] Furthermore unlike more developed market economies, China is reluctant to raise domestic interest rates to slow its domestic growth. Doing so might mean attracting more capital inflows, which would in turn, require further money issuance to stabilize the exchange rate. That is precisely why the PBC instead changes the reserve requirement ratio on an ongoing basis to control the expansion of money and credit. 4. Comparison of China and USA’s monetary policies There are three main differences between China and the United States where monetary policy is concerned: independence of the monetary policy implementing body, choice of instruments to use in implementing monetary policy, and direct or indirect means of setting interest rates to effect monetary policy. Furthermore, these three differences are inter-related and country specific. The first major difference between the Federal Reserve System (the Fed) and the People’s Bank of China (PBC) concerns their independence from national politics. The intention of Congress when designing the Federal Reserve Act was to keep politics out of monetary politics. The Fed is totally independent of other branches and agencies of the government. Furthermore, it is self financed and therefore is not subject to the congressional budgetary process. On the other hand, the PBC is not independent from national politics in China. The PBC reports directly to the State Council which serves as China’s cabinet as well as its highest executive body. Moreover, monetary policy in China is aimed at limiting the appreciation of the renminbi (RMB), while eeping economic growth at a sustainable pace and inflation under control plus preserving a fragile banking system. The Fed in contrast implements a monetary policy that has a dual objective of maximum employment and price stabilit y. The second difference regards the choice of the monetary policy instruments used by the Fed as opposed to the PBC. The choice of instruments used in implementing monetary is essentially the same, except that the PBC has the an additional instrument; namely â€Å"additional instruments as specified by the State Council. † It is therefore no surprise that this ‘extra instrument’ arises from the lack of independence on the part of the PBC. The third difference between the Fed and the PBC lies in the way they set the interest rates. The Fed sets its federal funds rate indirectly by setting a specified target rate and then using the the tools of monetary policy (open market operations, discount window lending, and reserve requirements) to achieve that target rate. As a result, the changes in the federal fund rates trigger a chain of events that affect other short term interest rates, long term interest rates, the amount of money and credit in the economy, plus other macro-economic variables such as employment, growth and the prices of goods and services. In contrast, the PBC has a direct influence on its interest rate because of the extra instrument described above. Because there is provision for other policy instruments as specified by State Council, this allows the PBC to set interest rates directly, and thus have a direct impact on the its balance sheet. 5. Conclusion There are major differences in monetary policy and central banking in China and the USA. China has a complex political economy that represents a hybrid of private ownership and state control. Therefore, the PBC’s monetary policies, choice of instruments and methods of implementation are quite different from that of the Fed. Monetary policy in China aims at curbing the appreciation of the RMB while keeping economic growth at a sustainable pace, inflation under control, and preserving a fragile banking system. This is contrasted with the Fed’s monetary policy with the dual objective of maximum employment and price stability. Different monetary policy objectives, coupled with the degree of political independence on the part of the Fed and the PBC greatly influence the choice of instruments used and the method of implementing monetary policy in the two respective countries. 6. References Federal Reserve Bank of New York Domestic Open Market Operations During 2008 Federal Reserve Bank of New York: â€Å"Annual Report Domestic Open Market Operations during 2008† Federal Reserve Statistical Release 19 November 2009 Ian Sheldon, â€Å"US-China Trade Policy: Who gains from a rise in the Yuan? † at http://aede. osu. edu/programs/Anderson/trade Luc de Wulf and David Goldsbrough, â€Å"The Evolving Role of Monetary Policy in China†, IMF Staff Papers WP/04/125 Michael Moskow and Cathy Lemieux â€Å"China up close: Understanding the Chinese economy and financial system†, at www. chigacofed. org People’s Bank of China Monetary Policy Annual Report 2008 Peter Stella, â€Å"The Federal Reserve System Balance Sheet: What Happened and Why it matters† IMF Staff Papers WP/09/120 Financial Services Regulatory Relief Act 2006 (USA) Federal Reserve Act 1913 (USA) Law of the People’s Republic of China on the People’s Bank of China 1995 (China) http://www. frbsf. org/publications/federalreserve/monetary/structure. html http://www. pbc. gov. cn/english/huobizhengce/MPC. asp http://en. wikipedia. org/wiki/Monetary_policy ———————– [1] 1913 [2] 2006 [3] China close up (2008)

Commonly Confused Word Pairs in English

Commonly Confused Word Pairs in English Here, from our Glossary of Commonly Confused Words, are 20 tricky word pairs that look and sound alike but have different meanings. (For examples and practice exercises, click on the highlighted words.) Advice and AdviseThe noun advice means guidance. The verb advise means to recommend or counsel.All Together and AltogetherThe phrase all together refers to people or things gathered in one place. The adverb altogether means entirely or wholly.Baited and BatedA hook, witness, or animal is baited (lured, enticed, tempted). Breath is bated (moderated).Cite and SiteThe verb cite means to mention or quote as an authority or example. The noun site means a particular place.Complement and ComplimentComplement means something that completes or brings to perfection. A compliment is an expression of praise.Discreet and DiscreteThe adjective discreet means tactful or prudent self-restraint. Discrete means distinct or separate.Eminent and ImminentThe adjective eminent means prominent or outstanding. Imminent means impending, about to occur.Flair and FlareThe noun flair means a talent or a distinctive quality or style. As a noun, flare means a fire or a blazing light. Similarly, the verb flare mea ns to burn with an unsteady flame or shine with a sudden light. Violence, troubles, tempers, and nostrils can flare. Formally and FormerlyThe adverb formally means in a formal way. The adverb formerly means at an earlier time.Hardy and HeartyThe adjective hardy (related to hard) means daring, courageous, and capable of surviving difficult conditions. The adjective hearty (related to heart) means showing warm and heartfelt affection or providing abundant nourishment.Ingenious and IngenuousThe adjective ingenious means extremely clevermarked by inventive skill and imagination. Ingenuous means straightforward, candid, without guile.Lightening and LightningThe noun lightening means making lighter in weight or changing to a lighter or brighter color. Lightning is the flash of light that accompanies thunder.Mantel and MantleThe noun mantel refers to a shelf above a fireplace. The noun mantle refers to a cloak or (usually figuratively) to royal robes of state as a symbol of authority or responsibility.Moot and MuteThe adjective moot refers to something that is debatable or of no practical importance. The adjective mute means unspoken or unable to speak. Prescribe and ProscribeThe verb prescribe means to establish, direct, or lay down as a rule. The verb proscribe means to ban, forbid, or condemn.Rational and RationaleThe adjective rational means having or exercising the ability to reason. The noun rationale refers to an explanation or basic reason.Shear and SheerThe verb shear means to cut or clip. Likewise, the noun shear refers to the act, process, or fact of cutting or clipping. The adjective sheer means fine, transparent, or complete. As an adverb, sheer means completely or altogether.Stationary and StationeryThe adjective stationary means remaining in one place. The noun stationery refers to writing materials. (Try associating the er in stationery with the er in letter and paper.)Track and TractAs a noun, track refers to a path, route, or course. The verb track means to travel, pursue, or follow. The noun tract refers to an expanse of land or water, a system of organs and tissues in the body, or a pamphlet containing a declarat ion or appeal. Whose and WhosWhose is the possessive form of who. Whos is the contraction of who is.