Problems With Measurements Of The Distance Of Stars Essays

Problems With Measurements Of The Distance Of Stars This is one of the most commonly asked questions and deserves an honest answer. Below is first a short answer then a more thorough answer. There are three things we need to consider when answering the starlight question. 1. Scientists cannot measure distances beyond 100 light years accurately. 2. No one knows what light is or that it always travels the same speed throughout all time, space and matter. 3. The creation was finished or mature when God made it. Adam was full-grown, the trees had fruit on them, the starlight was visible, etc. Let me elaborate on these 3 points. The farthest accurate distance man can measure is 20 light years (some textbooks say up to 100), not several billion light years. Man measures star distances using parallax trigonometry. By choosing two measurable observation points and making an imaginary triangle to a third point, and using simple trigonometry, man uses points available are the positions of the earth in solar orbit six months apart, say June and December. This would be a base for our imaginary triangle of 186,000,000 miles or 16 light minutes. There are 525,948 minutes in a year. Even if the nearest star were only one light year away (and it isn't), the angle at the third point measures .017 degrees. In simpler terms, a triangle like this would be the same angle two surveyors would see if they were standing sixteen inches apart and focusing on a third point 8.24 miles away. If they stayed 16 inches apart and focused on a dot 824 miles away, they would have the same angle as an astronomer measuring a point 100 light years away. A point 5 million years away is impossible to figure with trigonometry. The stars may be that far away but modern man has no way of measuring those great distances. No one can state definitively the distance to the stars. The stars may indeed be billions of light years away, but man cannot measure those distances. Several other methods such as luminosity and red shift are employed to try to guess at greater distances but all such methods have serious problems and assumptions involved. None of them account, however, for why a rabid little weasel like Kent Hovind would argue this, or why a student would copy a paper off of a bad essay site like this one. For a more complex and slightly different answer to the star light question from a Christian perspective, see the book Starlight and Time by Russell Humphry available from www.icr.org. Second, the speed of light may not be a constant. It does vary in different media (hence the rainbow effect of light going through a prism) and may vary in different places in space. Of course, Kent Hovind is a crackpot, but this is his copied essay, so we'll run with the idea. The entire idea behind the black hole theory is that light can be attracted by gravity and be unable to escape the great pull of these imaginary black holes. No one knows what light is let alone that it's velocity has been the same all through time and space. Since atomic clocks use the wavelength of the Cesium 133 atom as a standard of time, if the speed of light is decaying, the clock would be changing at the same rate and therefore not be noticed. Third, the creation account states that God made light before He made the sun, moon, or stars. The rest of creation was mature, so starlight was probably mature at creation as well. A strange notion, but then, this is a copied essay, so I will go with what it says. I would ask the question, How old was Adam when God made him? Obviously he was zero years old. But how old did he look? He was a full-grown man. The trees were full-grown with fruit on them the first day they were made. The creation had to be that way; it would not work otherwise. Stars and their light were made at the same time. The God that I worship is not limited by anything involving time, space or matter. Finally, I would also like to point out that the evolutionists have no answer to the basic questions like; Where did the original matter space and energy come from for the stars? I

The secret life of Walter Mitty Essay Example

The secret life of Walter Mitty Essay Example The secret life of Walter Mitty Paper The secret life of Walter Mitty Paper He is shopping in town while his wife is at the hairdressers. He has five daydreams during the story; he imagines that he is the commander of a warship (while driving), he imagines he is a surgeon who saves a millionaires life (while driving), a defendant in a courtroom who is accused of shooting someone (after reading a newspaper report on a similar trial), he imagines he is a pilot in the Second World War (whilst reading a Liberty magazine), and he imagines he is in front of a firing squad (whilst he is waiting for his wife). This story mentions the armed forces on more than one occasion, as an important part of American culture is the military. Americans are proud of their technological advances in the sea, in the air and on land. This story has reference to a US navy vessel, an eight-engined Navy hydroplane. Walter Mitty is the captain of this until his wife informs him that he is going too fast. Navy vessels are an important part of American culture as they rely on them heavily, they helped them to win both world wars, and are important in reminding the world who the most powerful country in the world currently is. In conclusion, the Americans like weapons to be mentioned, as they show Yankee genius. This story, like My Father, illustrates dominant women, although both are set in completely different periods. Walter Mittys wife keeps ordering him about, and complains to him whenever he does anything wrong, e. g. Why dont you wear gloves? Ive been looking all over the hotel for you. Why do you have to hide in this old chair? There are many other similar quotations in this story that demonstrate that Mrs. Mitty keeps bossing Walter Mitty around. This shows the fact that in American society, the women are often generally strong characters (as they are descended from women who were pioneers and had to spent a lot of the time travelling across unknown territory) Walter Mittys third daydream is in a courtroom, after he read a headline about the Waterbury trial. In his daydream, Walter Mitty is accused of murder by shooting them. This illustrates the gun culture that is and was present in the United States. Many people in America have the opportunities to get a gun, and many have done this and used it to result in deaths. This is what the trial is about. The author is illustrating the gun culture operating in America. Walter Mittys fourth daydream is about a heroic captain in the air force who is brave enough to try and fly an aircraft that needs two pilots in order to destroy a German ammunition dump. The heroes of any war that America fought in are still important in American culture today, as they are proud of what they achieved. They are so proud of their fellow countryman who have fought for their country, they have made numerous films on the subject, most of which are based on true stories. In many cases, they often change the nationality of the heroes in the film to American. The Secret Life of Walter Mitty shows us culture in the Second World War in America and how it has affected the modern American culture. A couple of Hamburgers, by James Thurber This story is about a man and his wife who are travelling by car over a long distance, and the wife wants to stop at a diner. The man finds a few diners, but she does not approve of them, and a disagreement breaks out. Throughout the whole journey they have been annoying each other. They find a suitable diner, but then the wife discovers that this is not suitable, and her husband becomes even more annoyed at her for this. He refuses to leave this diner, so orders a couple of Hamburgers, while she smokes in the car. To annoy her further he starts singing to her in the car as they continue their journey and the story ends. This story again illustrates strong women, although to a less extent than in The secret life of Walter Mitty and My father. The wife in this story (who is nameless) firstly says that she is hungry, implying that she wants him to stop, which he agrees to do. Any of the places that he finds are not suitable, for various reasons, e. g. because the diners have nicknames, or if they are owned by Greeks. They do not stop here, as she does not want to, as she is a strong woman. The couple in this story do not get on particularly well. They argue about many things, e. g. she keeps hearing a funny sound in the car, which they argue over, they argue over where to stop to eat, he starts singing to her songs that she detests. This illustrates that perhaps many married couples in the USA are not happy with their life, and the hint of perhaps divorce lurks in the air. Divorce in America has now become very common, in fact nine out of ten marriages in the USA end in divorce, so it is very important. Divorce probably started to become more popular in the period that this story is set (post Second World War). This story, like Jeremy Rodock and My Father has references to pioneers, both the husband and the wife have ancestors who are pioneers, and the husband likes to use pioneer expressions that she thinks are crude, such as sow belly, sticking to your rib, dog wagons, and stay our stomachs. He likes to use these expressions, as he is very proud of his ancestry, and likes to remind people of this fact. She is too, although to a less extent. The car is very important part of American culture, as it is to most countries, but the USA especially. The United States is a very large country, and many people need to travel from one part of the country to another. Before aircraft were commercialised, and even afterwards, the car was the main way to travel interstate. In this story, the couple are on a long journey and are travelling by car, without the invention of the motorcar; this journey would not have been possible. The interstate roads are also very important, unlike many European countries, the roads are mostly straight and direct as the towns grew up on the roads, then mainly used by horses. This story does exemplify that America grew with immigration, people from all over the word migrated to the USA to lead a better life. As a result, the diversity of culture in the USA is enormous. This story mentions Greeks particularly; the wife will not stop at a Greek diner. The hamburger, mentioned in the title of this story is not of American heritage, it is, as the name suggests, from the German city of Hamburg. People from Hamburg migrated to the US and spread their Hamburgers around, and the idea spread, and the Americans developed it to a national food. People from most countries in the world have immigrated to the USA, creating a unique country with unique cultures. The story is about Hamburgers. Hamburgers are fast food, which has become a major part of American culture, and a massive industry in the USA and worldwide, due to chains such as MacDonalds, etc. Fast food is such an important part of US culture as the Americans like food very quickly, and they like the taste of the food, and as many do not have much time to spare, they need food quickly, and as fat food satisfies all of these requirements, it has become very popular. There is not much slang or difference in language to the English language in this story, as the wife speaks quite good English, as well as the husband, but he does use pioneer expressions already mentioned. There is the use of American terms in this story that are presumably not of Pioneer origin, e. g. diner, tumbler, slosh, folks, etc. The only slang used in this story are: aint, and swell, (which is used in a different context to its proper meaning). The language difference in this story illustrates the difference in culture between the USA and the UK In conclusion, A couple of Hamburgers sheds light on culture in post war America. By reading these four stories, we have discovered the diversity of culture in the United States of America, in the periods between 1850-1960; we have seen cultures from pioneers to fast food and the difference of the role of women in society, among many other important factors.

Visit to a place of worship Essay Example | Topics and Well Written Essays - 1000 words

Visit to a place of worship - Essay Example In this way we can ease our minds of anxiety, fear, and care. Although salvation does not depend on going to church, and a Bible is not necessary to get to heaven—a personal interest in Christ is the one thing needful; yet there is no denying that our edification in public worship depends greatly on the kind of prayers that are prayed. for what we require for our physical and spiritual well-being. It is true, as our Lord says, that our heavenly Father knows all our needs before we pray, but he likes to hear us ask him and turn to him with our petitions. The Bible teaches us that â€Å"every good gift and every perfect gift is from above, and cometh down from the Father of lights, with whom is no variableness, neither shadow of turning† (James 1:17). God is the source of every blessing and is unchanging and faithful. Since that is so, then it is clear that we must go to him for what we need, and we may go with confidence for he bids us come, and because we come in the name of his dear Son, Jesus Christ. The church main service started a little bit late than their usual time because there was a baptismal ceremony. For one to qualify to be Baptist in that church, one had to be born again and had to go for a three month course. The pastor said that those who brought their children to be baptised, they brought them as believers. The infants were baptised as the seed of godly parents, and the godparents and parents are exhorted, as believers, to pray that the child may be born again and encouraged to lay hold on the promises made. And as the child of believers, the infant when baptised, is pronounced â€Å"Regenerate†, and thanks are given for it. On that day, I realised that one of the delightful parts of worship is the singing of God’s praises. Praise is different from thanksgiving. We praise God for what he is, holy, almighty, gracious, merciful, wise, all-knowing. These are some of the attributes of God. We praise

Gulf Air Case Study Example | Topics and Well Written Essays - 2500 words

Gulf Air - Case Study Example Assets of the gulf air company have become manifold as compared to the time it started its business. (Gulf Air Official Website, 2010) The history of Gulf aviation relates back to the 1940s when a British pilot and entrepreneur named Freddie Bosworth started a company with the aim of providing air taxi services to the local customers and to the businesses. For ten years he was carrying on with the company with his small fleet of aircrafts and at the end of first quarter of 1950 he transformed his business into a private shareholding company with the name of Gulf Aviation. Therefore, it can be regarded as one of the oldest air carriers performing operations in the Middle East. After some time in 1951, the founder of the company died and it was all set to be sold to the big guns of the aviation industry. (Gulf Air Official Website, 2010) In the month of October of the year 1951 British Overseas Airways Corporation (BOAC) acquired a 22% stake in the Gulf Aviation and therefore became a major share holder in the company. After the purchase of stake of the Gulf Aviation by British Overseas Airways Corporation (BOAC) some of the updated and technologically advanced aircrafts were added to the fleet of the company as well as the company started its services to London city. Year 1973 is regarded as the most important year in the his... Thus by the acquisition of the shares of the company Gulf air became the national carrier of those four countries in the Persian Gulf. Moving further along the line in the same year, Gulf aviation achieved another land mark with the establishment of the subsidiary company of Gulf Helicopters. In the 1980s an increase in the trend of travelling by air was seemed in the world and the air travel was seemed to be the best commuting route in the world. With this opportunity Gulf airways also cashed in to make the best out of the bargain. It was the time of some real growth for the company and the company made the best out of the available opportunities. In the year 1981 Gulf Air became an IATA member and in the following year, it became the first International airline to land at Riyadh. With the progress of the company more and more aircrafts were also being added to the fleet of the company and in the year 1988 Boeing 767s were added to the fleet of the company and with the addition of Boeing 767s more services were offered to different customers of the different destinations. Gulf air also has the prestige of being the first Arab airline to fly directly to the continent of Australia. In the year 1994 Gulf air started receiving the airbus aircrafts and in the year 2000 took t he delivery of all of the remaining airbus aircrafts. In the meanwhile gulf air extended its services to the other parts of the world and the procedure of expansion did not stop. In the 1990s gulf air was down on profits and was not performing well as a corporate entity when the reign of the fleet and resources of gulf air was held in the hands of a newly appointed CEO of the company. In the year 2002 Mr. James Hogan became the president

Credit Risk Management in the UK Banking Sector

Credit Risk Management in the UK Banking Sector Background 3 Literature Review 7 Ascertaining why and how banking credit risk exposure is evolving recently 8 Seeing how banks use credit risk evaluation and assessment tools to mitigate their credit risk exposure 11 The steps and methodologies used by banks to identify, plan, map out, define a framework, develop an analysis and mitigate credit risk 13 Determine the relationship between the theories, concepts and models of credit risk management and what goes on practically in the banking world 17 Ascertain the scope to which resourceful credit risk management can perk up bank performance 19 To evaluate how regulators and government are assisting the banks to identify, mitigate credit risk, and helping to adopt the risk-based strategies to increase their profitability, and offering assistance on continuous basis 20 Research Methodology 21 Analysis 23 Ascertaining why and how banking credit risk exposure is evolving recently 23 Seeing how banks use credit risk evaluation and assessment tools to mitigate their credit risk exposure 25 The steps and methodologies used by banks to identify, plan, map out, define a framework, develop an analysis and mitigate credit risk 31 Determine the relationship between the theories, concepts and models of credit risk management and what goes on practically in the banking world 35 Ascertain the scope to which resourceful credit risk management can perk up bank performance 38 To evaluate how regulators and government are assisting the banks to identify, mitigate credit risk, and helping to adopt the risk-based strategies to increase their profitability, and offering assistance on continuous basis 40 Primary Survey 45 Conclusions 46 Recommendations 50 Bibliography 56 Background The sub-prime mortgage meltdown that hit the global banking sector in 2007, was a result of circumstances, actions and repercussions that began years earlier (Long, 2007). It, the sub-prime mortgage crisis, was based on unsound ground from its inception. Sub-prime mortgages represent loans made to borrowers that have lower ratings in their credit than the norm (investopedia, 2007). Due to the lower borrower credit rating, they do not qualify for what is termed as a conventional mortgage due to default risk (investopedia, 2007). Sub-prime mortgages thus carry a higher interest rate to off set the risk increase, which helped to fuel the United States economy through increased home ownership, and the attendant spending that accompanies it (Bajaj and Nixon, 2006). Implemented by the Bush administration in the United States to get the economy rolling after the recession fuelled by the September 11th air attacks, the entire plan began to backfire as early as 2004 as a result of the continu ed building of new housing without the demand (Norris, 2008). The new construction glutted the market bringing down house prices. This, coupled with a slowing economy in the United States resulted in layoffs, as well as many subprime mortgage holders defaulting on their loans, and the crisis ballooned. Some attribute the over lending of subprime mortgages to predatory lending (Squires, 2004, pp. 81-87) along with the underlying faults of using it as an economic stimulus package that did not control the limits on new housing (Cocheo, 2007). That set of circumstances represented the cause of the subprime mortgage crisis that spread globally as a result of the tightening of credit due to defaulted loan sell offs and restricted banking lending ceilings caused by the Basel II Accords (Peterson, 2005). The complexity of the foregoing shall be further explained in the Literature Review section of this study. The preceding summary journey through the subprime mortgage crisis was conducted to reveal the manner in which banking credit crunches can and do occur. The significance of the foregoing to this study represents an example to awaken us to the external factors that can and do cause banking credit crisis situations, thus revealing that despite good management practices such events can m anifest themselves. It is also true that poor or lax banking practices can have the same effects. Credit risk management represents the assessing of the risk in pursuing a certain course, and or courses of action (Powell, 2004). In addition to the foregoing U.S. created subprime mortgage crisis, the appearance of new forms of financial instruments has and is causing a problem in credit risk management with regard to the banking sector. As the worlds second largest financial centre, the United Kingdom is subject to transaction volumes that increase the risks the banking sector takes as so many new forms of financial instruments land there first. McClave (1996, p. 15) provides us with an understanding of bank risk that opens the realm to give us an overview of the problem by telling us: Banks must manage risk more objectively, using quantitative skills to understand portfolio data and to predict portfolio performance. As a result, risk management will become more process-oriented and less dependent on individuals. Angelopoulos and Mourdoukoutas (2001, p. 11) amplify the preceding in stating that Banking risk management is both a philosophical and an operational issue. They add: As a philosophical issue, banking risk management is about attitudes towards risk and the payoff associated with it, and strategies in dealing with them. As an operational issue, risk management is about the identification and classification of banking risks, and methods and procedures to measure, monitor, and control them. (Angelopoulos and Mourdoukoutas, 2001, p. 11) In concluding, Angelopoulos and Mourdoukoutas (2001, p. 11) tell us that the two approaches are in reality not divorced, and or independent form each other, and that attitudes concerning risk contribute to determining the guidelines for the measurement of risk as well as its control and monitoring. The research that has been conducted has been gathered to address credit risk management in the United Kingdom banking sector. In order to equate such, data has been gathered from all salient sources, regardless of their locale as basic banking procedures remain constant worldwide. References specific to the European Union and the United Kingdom were employed in those instances when the nuances of legislation, laws, policies and related factors dictated and evidenced a deviance that was specific. In terms of importance, credit risk is one of the most important functions in banking as it represents the foundation of how banks earn money from deposited funds they are entrusted with. This being the case, the manner in which banks manage their credit risk is a critical component of their performance over the near term as well as long term. The implications are that todays decisions impact the future, thus banks cannot approach current profitability without taking measures to ensure that decisions made in the present do not impact them negatively in the future (Comptroller of the Currency, 2001). A well designed, functioning and managed credit risk rating system promotes the safety of a bank as well as soundness in terms of making informed decisions (Comptroller of the Currency, 2001). The system works by measuring the different types of credit risk through dividing them into groups that differentiate risk by the risk posed. This enables management as well as bank examiners to mon itor trends and changes to risk exposure, and this minimise risk through diversifying the types of risk taken on through separation (Comptroller of the Currency, 2001). The types of credit risks a bank faces represents a broad array of standard, meaning old and establishes sources, as well as new fields that are developing, gaining favour, and or impacting banks as a result of the tightness of international banking that creates a ripple effect. The aforementioned subprime crisis had such an effect in that the closeness of the international banking community accelerated developments. The deregulation of banking has increased the risk stakes for banks as they now are able to engage in a broad array of lending and investment practices (Dorfman, 1997, pp. 67-73). Banking credit risk has been impacted by technology, which was one of the contributing factors in the subprime crisis (Sraeel, 2008). Technology impacts banks on both sides of the coin in that computing power and new software permits banks to devise and utilise historical risk calculations in equating present risk forms. However, as it is with all formulas, they are only as effective as the par ameters entered (Willis, 2003). The interconnected nature of the global banking system means that bank risk has increased as a result of the quick manner in which financial instruments, credit risk transfer, and other systems, and or forms of risk are handled. The Bank for International Settlements led a committee that looked into Payment and Settlement Systems, which impacts all forms of banking credit risk, both new forms as well as long standing established ones in loans, investments and other fields (TransactionDirectory.com, 2008). The report indicates that while technology and communication systems are and have increased the efficiency of banking through internal management as well as banking systems, these same areas, technology and communications systems also have and are contributing to risk. The complexity of the issues that arise in a discussion of credit risk management means that there are many terms that are applicable to the foregoing that are banking industry specific to this area. In presenting this material, it was deemed that these special terms would have more impact if they were explained, in terms of their context, as they occur to ease the task of digesting the information. This study will examine credit risk management in the UK banking sector, and the foregoing thus will take into account banking regulations, legislation, external and internal factors that impact upon this. Literature Review The areas to be covered by this study in relationship to the topic area Credit Risk Management in the UK Banking Sector entails looking at as well as examining it using a number of assessment and analysis points, as represented by the following: Ascertaining why and how banking credit risk exposure is evolving recently. Seeing how banks use credit risk evaluation and assessment tools to mitigate their credit risk exposure. The steps and methodologies used by banks to identify, plan, map out, define a framework, develop an analysis and mitigate credit risk. Determine the relationship between the theories, concepts and models of credit risk management and what goes on practically in the banking world. Ascertain the scope to which resourceful credit risk management can perk up bank performance. To evaluate how regulators and government are assisting the banks to identify, mitigate credit risk, and helping to adopt the risk-based strategies to increase their profitability, and offering assistance on continuous basis. The foregoing also represents the research methodology, which shall be further examined in section 3.0. These aspects have been included here as they represented the focus of the Literature Review, thus dictating the approach. The following review of literature contains segments of the information found on the aforementioned five areas, with the remainder referred to in the Analysis section of this study. Ascertaining why and how banking credit risk exposure is evolving recently. In a report generated by the Bank for International Settlements stated that while transactional costs have been reduced as a result of advanced communication systems, the other side of this development has seen an increase with regard to the potential for disruptions to spread quickly and widely across multiple systems (TransactionDirectory.com, 2008). The Report goes onto add that concerns regarding the speed in which transactions occur is not reflected adequately in risk controls, stress tests, crisis management procedures as well as contingency funding plans (TransactionDirectory.com, 2008). The speed at which transactions happen means that varied forms of risk can move through the banking system in such a manner so as to spread broadly before the impact of these transactions is known, as was the case with the subprime mortgage crisis debt layoff. One of the critical problems in the subprime crisis was that it represented a classic recent example of the ripple effect caused by rapid interbanking communications, and credit risk transfer. When the U.S. housing bubble burst, refinance terms could not cover the dropping house prices thus leading to defaults. The revaluation of housing prices as a result of overbuilding forced a correction in the U.S. housing market that drove prices in many cases below the assessed mortgage value (Amadeo, 2007). The subprime mortgage problem was further exacerbated by mortgage packages such as fixed rate, balloon, adjustable rate, cash-out and other forms that the failure of the U.S. housing market impacted (Demyanyk and Van Hemert, 2007). As defaults increased banks sold off their positions in bad as well as good loans they deemed as risks as collateralised debt obligations and sold them to differing investor groups (Eckman, 2008). Some of these collateralised debt obligations, containing subprim e and other mortgages, were re-bundled and sold again on margin to still another set of investors looking for high returns, sometimes putting down $1 million on a $100 million package and borrowing the rest (Eckman, 2008). When default set in, margins calls began, and the house of cards started caving in. Derivatives represent another risk form that has increased banking exposure. The preceding statement is made because new forms of derivatives are being created all of the time (Culp. 2001, p. 215). Derivatives are not new, they have existed since the 1600s in a rudimentary form as predetermined prices for the future delivery of farming products (Ivkovic, 2008). Ironically, derivatives are utilised in todays financial sector to reduce risk via changing the financial exposure, along with reducing transaction costs (Minehan and Simons, 1995). In summary, some of the uses of derivatives entail taking basic financial instruments as represented by bonds, loans and stocks, as a few examples, and then isolating basic facets such as their agreement to pay, agreements to receive or exchange cash as well as other considerations (financial) and packaging them is financial instruments (Molvar, et al, 1995). While derivatives, in theory, help to spread risk, spreading risk is exactly what caused t he subprime meltdown as the risk from U.S. mortgage were bundled and sold, repackaged, margined, and thus created a raft of exposure that suffered from the domino effect when the original house of cards came crashing down. Other derivative forms include currency swaps as well as interest rate derivatives that are termed as over the counter (Cocheo, 1993). The complexity of derivatives has increased to the point where: auditors will need to have special knowledge to be able to evaluate the derivatives measurement and disclosure so they conform with GAAP. For example, features embedded in contracts or agreements may require separate accounting as a derivative, while complex pricing structures may make assumptions used in estimating the derivative s fair value more complex, too. (Coppinger and Fitzsimons, 2002) The preceding brings attention to the issues in evaluating the risks of derivatives, and banks having the proper staffing, financial programs and criteria to rate derivative risks on old as well as the consistently new forms being developed. Andrew Crockett, the former manager for the Bank of International Settlements, in commenting on derivatives presented the double-edged sword that these financial instruments present, and thus the inherent dangers (Whalen, 2004) When properly used, (derivatives) can be a powerful means of controlling risk that allows firms to economize on scarce capital. However, it is possible for new instruments to be based on models, which are poorly designed or understood, or for the instruments to give rise to a high degree of common behaviour in traded markets. The result can be large losses to individual firms or increased market volatility. The foregoing provides background information that relates to understanding why and how banking credit risk exposure has and is evolving. The examples provided have been utilised to illustrate this. Seeing how banks use credit risk evaluation and assessment tools to mitigate their credit risk exposure. As credit risk is the focal point throughout this study, a definition of the term represents an important aspect. Credit risk is defined as (Investopedia, 2008): The risk of loss of principal orloss of a financial reward stemming from a borrowers failure to repay a loan or otherwise meet a contractual obligation. Credit risk arises whenever a borrower is expecting to use future cash flows to pay a current debt. Investors are compensated for assuming credit risk by way of interest payments from the borrower or issuer of a debt obligation. Risk, in terms of investments, is closely aligned with the potential return being offered (Investopedia, 2008). The preceding means that the higher the risk, the higher the rate of return expected by those investing in the risk. Banks utilise a variety of credit risk evaluation and assessment tools to apprise them of credit risk probabilities so that they can mitigate, and or determine their risk exposure. There are varied forms of credit risk models, which are defined as tools to estimate credit risk probability in terms of losses from banking operations in specific as well as overall areas (Lopez and Saidenburg, 2000, pp. 151-165). Lopez and Saidenberg (1999) advise us that the main use of models by banks is to provide forecasts concerning the probability of how losses might occur in the credit portfolio, and the manner in which they might happen. They advise that the aforementioned credit risk model projection of loss distribution is founded on two factors (Lopez and Saidenberg, 1999): the multivariate, which means having more than one variable (Houghton Mifflin, 2008) distribution concerning the credit losses in terms of all of the credits in the banks portfolio, and the weighting vector, meaning the direction, characterising these credits. As can be deduced, the ability to measure credit risk is an important factor in improving the risk management capacity of a bank. The importance of the preceding is contained in the Basel II Accord that states the capital requirement is three times the projected maximum loss that could occur in terms of a portfolio position (Vassalou, M., Xing, Y., 2003). Risk models and risk assessment tools form and are a structural part of the new Basel II Accord in that banks are required to adhere to three mechanisms for overall operational risk that are set to measure and control liquidity risk, of which credit risk is a big component (Banco de Espana, 2005). The key provisions of the Basel II Accord set forth that (Accenture, 2003): the capital allocation is risk sensitive, separation of operational risk, from credit risk, vary the capital requirements in keeping with the different types of business it conducts, and encourage the development and use of internal systems to aid the bank in arriving at capital levels that meet requirements An explanation of the tools utilised by banks in terms of evaluation as well as assessment will be further explored in the Analysis segment of this study. The steps and methodologies used by banks to identify, plan, map out, define a framework, develop an analysis and mitigate credit risk. The process via which banks identify, plan, map out, define frameworks, develop analyses, and mitigate credit risk represent areas as put forth by the Basel II Accord, which shall be defined in terms of the oversight measures and degrees of autonomy they have in this process. In terms of the word autonomy, it must be explained that the Basel II Accord regulates the standard of banking capital adequacy, setting forth defined measures for the analysis of risk that must meet with regulatory approval (Bank for International Settlements, 2007). This is specified under the three types of capital requirement frameworks that were designed to impact on the area of pricing risk to make the discipline proactive. The rationale for the preceding tiered process is that it acts as an incentive for banks to seek the top level that affords them with a lowered requirement for capital adequacy as a result of heightened risk management systems and processes across the board (Bank for International Settl ements, 2007). The foregoing takes into account liquidity (operational) risk as well as credit risk management and market risk. The risk management active foundation of the Basel II Accord separates operational risk from credit risk, with the foundation geared to making the risk management process sensitive, along with aligning regulatory and economic capital aspects into closer proximity to reduce arbitrage ranges (Schneider, 2004). The process uses a three-pillar foundation that consists of minimum capital requirements along with supervisory review as well as market discipline to create enhanced stability (Schneider, 2004). The three tiers in the Basel II Accord, consist of the following, which are critical in understanding the steps, and methodologies utilised by banks to identify, plan, map, define frameworks, analyse and mitigate risk (Bank for International Settlements, 2007): Standardised Approach This is the lowest level of capital adequacy calculation, thus having the highest reserves. Via this approach risk management is conducted in what is termed as a standardised manner, which is founded on credit being externally assessed, and other methods consisting of internal rating measures. In terms of banking activities, they are set forth under eight business categories (Natter, 2004): agency services, corporate finance, trading and sales, asset management, commercial banking, retail banking, retail brokerage, payment and settlement The methodology utilised under the standardised approach is based on operational risk that is computed as a percentage of the banks income that is derived from that line of business. Foundation Internal Rating Based Approach (IRB) (Bank for International Settlements, 2007) The Foundational IRB utilises a series of measurements in the calculation of credit risk. Via this method, banks are able to develop empirical models on their own for use in estimating default probability incidence for clients. The use of these models must first be reviewed and cleared by local regulators to assure that the models conform to standards that calculate results in a manner that is in keeping with banking processes in terms of outcomes and inputs to arrive at the end figures. Regulators require that the formulas utilised include Loss Given Default (LGD), along with parameters consisting of the Risk Weighted Asset (RWA) are part of the formulas used. Banks that qualify under this tier are granted a lower capital adequacy holding figure than those under the first tier. Advanced Internal Rating Based Approach (IRB) (Bank for International Settlements, 2007) Under this last tier, banks are granted the lowest capital adequacy requirements, if they qualify by the constructing of empirical models that calculate the capital needed to cover credit risk. The techniques, personnel and equipment needed to meet the foregoing are quite extensive, requiring a substantial investment of time, materials, funds, and personnel to accomplish the foregoing, thus this measure generally applies to the largest banks, that have the capability to undertake these tasks. As is the case under the Foundation Internal Rating Based Approach, the models developed must meet with regulator approval. Under this aspect of the Basel II provisions for this tier, banks are permitted to create quantitative models that calculate the following (Bank for International Settlements, 2007): Exposure at Default (EAD), the Risk Weighted Asset (RWA) Probability of Default (PD), and Loss Given Default (LGD). The above facets have been utilised to provide an understanding of the operative parameters put into place by Basel II that define the realm in which banks must operate. These tiers also illustrate that the depth of the manner in which banks identify, plan, map out, define frameworks, analyse and mitigate credit risks, which varies based upon these tiers. Under the Standardised Approach the formulas are devised by the regulators, with banks having the opportunity to devise their own models. Graphically, the preceding looks as follows: Chart 1 Basel II Three Pillars (Bank for International Settlements, 2007) Determine the relationship between the theories, concepts and models of credit risk management and what goes on practically in the banking world. The Basel Committee on Banking Supervision (2000) states that the goal of credit risk management is to maximise a banks risk adjusted rate of return by maintaining credit risk exposure within acceptable parameters. The foregoing extends to its entire portfolio, along with risk as represented by individual credits, and with transactions (Basel Committee on Banking Supervision, 2000). In discussing risk management theories, Pyle (1997)/span> states it is the process by which managers satisfy these needs by identifying key risks, obtaining consistent, understandable, operational risk measures, choosing which risks to reduce, and which risks to increase and by what means, and establishing procedures to monitor the resulting risk position. The preceding statement brings forth the complex nature of credit risk management. In understanding the application of risk it is important to note that credit risks are defined as changes in portfolio value due to the failure of counter parties to m eet their obligations, or due to changes in the markets perception of their ability to continue to do so (Pyle, 1997). In terms of practice, banks have traditionally utilised credit scoring, credit committees, and ratings in an assessment of credit risk (Pyle, 1997). Bank regulations treat market risk and credit risk as separate categories. J.P. Morgan Securities, Inc. (1997) brought forth the theory that the parallel treatment of market risk and credit risk would increase risk management by gauging both facets would aiding in contributing to the accuracy of credit risk by introducing external forces and influences into the equation that would reveal events and their correlation with credit risk. Through incorporating the influence and effect of external events via an historical perspective, against credit risk default rates, patterns and models result that can serve as useful alerts to pending changes in credit risk as contained in Pyles (1997)/span> statement that ended in due to changes in the markets perception of their ability to continue to do so. The Plausibility Theory as developed by Wolfgang Spohn represents an approach to making decisions in the face of unknowable risks (Value Based Management, Inc., 2007). Prior to the arrival of the Plausibility Theory, Bayesian statistics was utilised to predict and explain decision making which was based upon managers making decisions through weighing the likelihood of differing events, along with their projected outcomes (Value Based Management, Inc., 2007). Strangely, the foregoing this theory was not applied to banking. The Risk Threshold of the Plausibility Theory assesses a range of outcomes that may be possible, however it does focus on the probability of hitting a threshold point, such as net loss relative to acceptable risk (Value Based Management, Inc., 2007). The new Basel II Accord employs a variant of the foregoing that is termed as Risk Adjusted Return on Capital which is a measurement as well as management framework for measuring risk adjusted financial performance and for providing a consistent view of profitability across business (units divisions) (Value Based Management, Inc., 2007). The foregoing theory of including external events in a calculative model with business lines credit risks is yet to be fully accepted as the variables from external predictive models to result in scenarios along with credit risk models is a daunting set of equations. Ascertain the scope to which resourceful credit risk management can perk up bank performance. In equating how and the scope in which resourceful credit risk management can improve bank performance, one needs to be cognizant that credit risk represents the primary type of financial risk in the bank sector as well as existing in almost all areas that are income generating (Comptroller of the Currency, 2001). From the preceding it flows that a credit risk rating system that is managed and run well will and does promote bank soundness as well as safety through helping to make and implement decision making that is informed (Comptroller of the Currency, 2001). Through the construction and use of the foregoing, banking management as well as bank examiners and regulators are able to monitor trends as well as changes occurring in risk levels (Comptroller of the Currency, 2001). Through the preceding, management is able to better manage risk, thus optimising returns (Comptroller of the Currency, 2001). The improvement of credit risk management in terms of identification and monitoring, the process when operated effectively can improve bottom line performance through laying off risk identified as potentially being problematic in the future (KPMG, 2007). Zimmer (2005) helps us to understand the nuances of transferring credit risk by telling us: A bank collects funds and originates loans. It might only be able to attract funds if it holds some risk capital that finances losses and saves the bank from insolvency if parts of its loan portfolio default. If the bank faces increasing costs of raising external finance, CRT has a positive effect on the lending capacity of the bank. Providing the bank with additional risk capital, CRT lowers the banks opportunity cost of additional lending and increases its lending capacity. As has been covered herein, credit risk represents a potential income loss area for banks in that default subtracts from income, thus lowering a banks financial performance. The Bank for International Settlements (2003) advises that the principle cause of banking problems is directly related to credit standards that are lax, which is termed as poor risk management. The preceding reality has been documented by the The Bank for International Settlements (2003) that advises that poor credit risk management procedures and structures rob banks of income as they fail to identify risks that are in danger of default, and thus taking the appropriate actions. A discussion of the means via which resourceful credit risk management enhance bank performance in delved into under the Analysis segment of this study. To evaluate how regulators and government are assisting the banks to identify, mitigate credit risk, and helping to adopt the risk-based strategies to increase their profitability, and offering assistance on continuous basis. In delving into banking credit risk management in the United Kingdom, legislation represents the logical starting place as it sets the parameters and guidelines under which the banking sector must operate. The Basel II Accord represents the revised i

An Unwinnable War Essay -- American History, The War on Terrorism

As America find herself in today’s â€Å"War on Terrorism,† one can easily find a number of similarities between today’s situation and the war in Vietnam. As the Taliban steadily loses control and power over Afghanistan, it becomes exceedingly important to discuss potential replacement governments. Afghanistan is, like Vietnam in the 50’s and 60’s, a very volatile country full of a variety of people speaking different dialects and practicing different religions. It is very important, then, that the government that is installed is one that is capable of maintaining some type of control or authority over its diverse people. On July 7, 1954, Ngo Dinh Diem came to power as the Prime Minister of South Vietnam (Fishel 107). Diem was backed by the United States as the best man for the job to prevent communism in South Vietnam. The problem is that while â€Å"every foreign power to intervene in Vietnam eventually attempted to install some group of Vietnamese figures to prevent a Communist victory,† many of them failed to consider that by installing a government that continued to exploit and alienate its people, they were driving the population more toward Communism because at least it seemed to be a government for the people (Gettleman 134). Likewise, the U.S. was concerned with its own interest and unfortunately overlooked the interests of the Vietnamese. In the first five or six years of Diem’s reign, the United States was quite pleased with its choice of Diem. Proponents of Diem praised him as an advocate of human rights who worked to uphold a democracy. Others who were not quite as flagrant in their approval simply stated that he was the best man among the limited choices being that he was strongly anti-communist. Many, includin... ...enerals who don’t even command a company. He lives in an ivory tower surrounded by his family† (Behind 150). Diem was also said to have given the Catholic regugees â€Å"preferential treatment in land redistribution, relief and assistance, commercial and export-import licenses, government employment, and other GVN largess† (Buddhist 217). The U.S. constantly pressured Diem to issue land reform in order to win some support from the peasants because, as his American advisors recognized â€Å"an exploited and impoverished peasantry provides fertile soil for communism, as in China; therefore, intelligent land reform, preserving private property and simultaneously creating a new middle class of farmers, is a necessity for ‘free world’ objectives† (Behind 142). This idea plays into the aforementioned assertion that America focused too heavily on their own interests (

Media Influence

Media influence or media effects are terms used in media studies, psychology, communication theory and sociology to refer to the theories about the ways the mass media affect how their audiences think and behave. Mass media plays a crucial role in forming and reflecting public opinion, connecting the world to individuals and reproducing the self-image of society. Critiques in the early-to-mid twentieth century suggested that media weaken or delimit the individual's capacity to act autonomously — sometimes being ascribed an influence reminiscent of the telescreens of the dystopian novel 1984. Mid 20th-century empirical studies, however, suggested more moderate effects of the media. Current scholarship presents a more complex interaction between the media and society, with the media on generating information from a network of relations and influences and with the individual interpretations and evaluations of the information provided, as well as generating information outside of media contexts. The consequences and ramifications of the mass media relate not merely to the way newsworthy events are perceived (and which are reported at all), but also to a multitude of cultural influences that operate through the media. The media has a strong social and cultural impact upon society. This is predicated upon their ability to reach a wide audience with a strong and influential message. Marshall McLuhan uses the phrase â€Å"the medium is the message† as a means of explaining how the distribution of a message can often be more important than content of the message itself. [1] It is through the persuasiveness of media such as television, radio and print media that messages reach their target audiences. These have been influential media as they have been largely responsible for structuring people's daily lives and routines. 2] Television broadcasting has a large amount of control over the content society watches and the times in which it is viewed. This is a distinguishing feature of traditional media which New media have challenged by altering the participation habits of the public. The internet creates a space for more diverse political opinions, social and cultural viewpoints and a heightened le vel of consumer participation. There have been suggestions that allowing consumers to produce information through the internet will lead to an overload of information. Media Influence Media influence or media effects are terms used in media studies, psychology, communication theory and sociology to refer to the theories about the ways the mass media affect how their audiences think and behave. Mass media plays a crucial role in forming and reflecting public opinion, connecting the world to individuals and reproducing the self-image of society. Critiques in the early-to-mid twentieth century suggested that media weaken or delimit the individual's capacity to act autonomously — sometimes being ascribed an influence reminiscent of the telescreens of the dystopian novel 1984. Mid 20th-century empirical studies, however, suggested more moderate effects of the media. Current scholarship presents a more complex interaction between the media and society, with the media on generating information from a network of relations and influences and with the individual interpretations and evaluations of the information provided, as well as generating information outside of media contexts. The consequences and ramifications of the mass media relate not merely to the way newsworthy events are perceived (and which are reported at all), but also to a multitude of cultural influences that operate through the media. The media has a strong social and cultural impact upon society. This is predicated upon their ability to reach a wide audience with a strong and influential message. Marshall McLuhan uses the phrase â€Å"the medium is the message† as a means of explaining how the distribution of a message can often be more important than content of the message itself. [1] It is through the persuasiveness of media such as television, radio and print media that messages reach their target audiences. These have been influential media as they have been largely responsible for structuring people's daily lives and routines. 2] Television broadcasting has a large amount of control over the content society watches and the times in which it is viewed. This is a distinguishing feature of traditional media which New media have challenged by altering the participation habits of the public. The internet creates a space for more diverse political opinions, social and cultural viewpoints and a heightened le vel of consumer participation. There have been suggestions that allowing consumers to produce information through the internet will lead to an overload of information.