Should the companies proclaim policy for protect the worker's family Essay

Should the companies proclaim policy for protect the worker's family and what's the effect - Essay Example Failing to protect the worker and the worker’s family could be very disadvantageous to the company in terms of image and brand because the general public will be appalled with a company’s labor practice that disregard the welfare and protection of its employees and its immediate dependents. When the general public will perceive the company as uncaring, they will be turned off with the company and will cease patronizing its products. When customers no longer patronize or buy a company’s product or service, its sales will decline and it follows that when sales decline, the profitability of the company will also decline and it will not be long before the company will go bankrupt. In addition to customers who would be put off with a company that does not proclaim the protection of its employee and their families, investors and the general public will begin to have a negative perception of its shares of stock and it will follow that its stock price will decline due to the negative perception of the market. When that happens, returns to the shareholders will also decline. When the returns of the shareholders investment will decline, they will withdraw their money from the company and will look for other companies to invest it in where it could be more profitable. Thus, the evil cycle will begin with shareholders leaving the company aggravating the already negative perception on the company. In the end, the company may even go bankrupt just because of the market’s negative perception of the company with its uncaring labor practice with its employees and their families. The refusal or failure of the company to protect the worker and their families come in many ways. For the worker’s family’s refusal or inability to protect them by the company, this could come in the form of non recognition of health insurance coverage and in today’s case refusal to implement Obamacare. In effect, this law mandates that companies are all required to protect all their workers and their families from rising medical cost despite their medical condition. Failure to cover its employees would tantamount to paying fines which the law will impose on the company. This is important to mention because this is the new context that businesses will be operating in terms of providing health insurance to their employees and their employees. It meant that companies will have to cover all of its employees including those who were previously uninsurable and those who have pre-exisitng conditions and that includes their families. This may mean an added cost in terms of paying premiums as employees who were not uninsurable has to be insured now that companies may be tempted to renege it to save on cost. The consequence proved to be more expensive because companies who refused to provide medical insurance protection to their employees and their families were fined heavily such as the case of big companies such as AT&T and Caterpillar who decided to stop providing health coverage for their employers because of its additional cost. As a result, it was slapped with penalty and mandated to pay heavy fines that were very costly (Colvin 125). Big companies are considering this option because the forced coverage of the new law on health insurance on all of its employees including those who were previously uninsurable would mean huge addition of cost due to the scale of its employees. Such, they deemed it more

The Glass Cliff Essay Example for Free

The Glass Cliff Essay Ibarra et al suggest that high-potential women often miss out on sponsorship, an element of mentoring that increases the incidence and speed of candidates’ promotion to upper management positions. Bruckmuller and Branscombe illustrate in their article, The Glass Cliff, a gender partiality that exists when companies look to hire a new executive. Companies with predominantly male executives and in stable financial states are more likely to hire another male executive, while a tanking company with male executives will favor the female candidate. Both articles contribute evidence to further back the claim that women receive fewer promotional opportunities than men and identify how our common assumptions about gender and leadership impede our movement towards gender equality. However, neither article does well to disarm the biased reader, consequently placing the transmission of an invaluable message at risk. If the authors’ underlying purpose for writing these articles is to promote equal opportunity at all organizational levels as a means to optimize the utility of available human resources, they do not effectively communicate their message. At first glance, it appears that these articles intend to increase awareness of the additional roadblocks women face on their way to executive suites. Numbers, experiments, and thorough analysis confirm that this is so. I have no doubt that a young ambitious female professional would likely feel outraged at the sight of these figures and feel compelled to join the crusade. However, a man who does not see the benefits of women in management or a woman who does not aspire to be a manager might perceive these articles as personal grievances and greet them with discord. Such an individual might contest that since every author is female, the articles are therefore biased and the integrity of the articles is compromised. In this instance, the message and potential progress towards equal opportunity is lost. To avoid this predicament, I might suggest presenting evidence that would appeal to male executives, as they occupy the majority of the upper echelon positions and thus, possess the mos t power to resist or catalyze change. Perhaps a worthy initiative would be to increase these managers awareness of the similarity–attraction principle, which explains how when given the opportunity to select another member to interact within a group, individuals have a proclivity to select persons who are similar to themselves (i.e. male). The argument could go on to explain to managers how such behavior can detrimentally serve a management team by inhibiting heterogeneity, which research suggests facilitates long-term team performance (Horwitz, 2007). Whether this is a sound argument is debatable, but this topic is much less likely to be met with resistance simply due to the nature of the subject matter. Every executive agrees that long-term team performance is a worthy pursuit. In this scenario, both parties understand the value of the message and have potential to mutually benefit from it. References Horwitz, Sujin K., and Irwin B. Horwitz. The effects of team diversity on team outcomes: A meta-analytic review of team demography. Journal of management 33.6 (2007): 987-1015.

Mindful Destruction of Order in Shakespeares Othello Essay -- Shakespe

A delicate balance of chaos and order exists in our lives; the balance maintains itself by the very acts of human nature. In the drama Othello, the battle between good and evil creates the basic root of human nature as a whole. While at first, order exists in the lives of the Othello and Iago, through dramatic events and manipulation, the balance becomes unstable and starts to shift into chaos. Once the chaos has started, it continues a chain that continues along until the very end where the balance finally restores itself as it would in human nature. Through the inter and intra personal dialogue between Othello and Iago, a certain image of the character becomes developed because of the continued additions and changes to the character’s situation. Seen as the stronger of the two, Othello holds less intelligence in common matters. Iago’s character shapes out to as more of cunning and strong-headed. Shakespeare uses the characters to effectively reaffirm the basic traits of human nature and show how the traits coincide with the theory of order and chaos. Thorough the use of extensive characterization in this drama, along with artful diction, the development of Othello and Iago, represents a view of humans and their lives along with the all too classic good and evil. Iago represents evil at the most simplistic level. Of the many traits Iago has ascertained many represent the hatred and jealousy that he has for the people he manipulates, â€Å"But for my sport and profit. I hate the Moor...[he] is of a free and open nature. That thinks men honest that but seem to be so. And will as tenderly be led by th’ nose. As asses are,† (1.3. 377-393). Iago knows that Othello has a trusting nature with most men who appear honest, he knows he has th... ...hat exactly happens between the point of believing and realizing the truth. From the play, one grasps an understanding of the crucial need to think and look at the facts in life before acting on an impulse. It also shows that chaos will always exist no matter what, but if we do not understand it, we cannot make embrace it. Through Othello’s lesson, we learn that the truth can always remained covered up and not represented entirely, and therefore it becomes our own responsibility to take the lead and grasp the understanding of things. Works Cited Arp, Thomas. "William Shakespeare's Othello the Moor of Venice" Instructor's Manual to accompany Perrine's literature. 7th edtion. San Antonio : HB, 1998. Print. Carlson, Marvin. â€Å"Othello in Vienna†, Othello. Signet Classics. New York, 1998. Pages (214-215) Shakespeare, William, Othello. Signet Classics. New York, 1998

Buy Essay Online: Comparing Homers Odyssey and Joyces Ulysses

Comparing Homer's Odyssey and Joyce's Ulysses  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚   This essay will analyze the style, genre and plots of the "Hades" episodes found in Homer's Odyssey and Joyce's Ulysses. Before entering this small treatise, it is important to understand the etymology of the word Hades, since it is the setting for both Joyce and Homer (of course in Homer's case, he was speaking of the literal aidhs and Joyce was referring to the graveyard, where Bloom attends the funeral of Paddy Dignam and "broods about the death of his only son ").   Homer's use of the word Hades   was to refer to the abode of the dead or the unseen nether world; where we find Odysseus searching for Tiresias, to find out how to return to Ithaca safely.   The Homeric Hades is not the modern view of Hell, mentioned in the Old and New Testaments.   In fact, C.S. says   "In real Pagan belief, Hades was hardly worth talking about; a world of shadows, of decay.   Homer . . . represents the ghosts [in Hades] as witless.   They gibber meaninglessly until some li ving man gives them sacrificial blood to drink. "   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Comparing the style: Objective vs. Existential    Eight months prior to the first publication of Ulysses , Joyce penned: "If you want to read Ulysses you had better first get or borrow from a library a translation in prose of the Odyssey of Homer. " Joyce's recommendation is a must in order to get the full meaning of his work.   A good commentary    would also be found useful in exegesis.   Most people, ". . . opening Ulysses at random are easily scarecrowed away by the first shock of [its] queer mixture of vulgar slang and metaphysical obscurity. " I must admit that my first reading of Ulysses   was horrifying.   I am a lover of the western class... ...oehrich, Rolf. The Secret of Ulysses. (Folcroft, PA: Folcroft Press, 1969)    Schutte, William, "An Index of Recurrent Elements in Ulysses: "Hades". James    Joyce Quarterly. Spring 1977: (Vol. XIV, No. 3)    Skeat, Walter. Concise Dictionary of English Etymology. (Great Britain:Wordsword, 1993)    Smith, William. Wordsworth Classical Dictionary. (London: Wordsworth Editions, 1996)    Smith, Paul. A Key to the Ulysses of James Joyce. (New York: Covici Friede, 1934)    Thornton, Weldon. Allusions in Ulysses. (North Carolina: UNC Press, 1968)    The student may wish to begin the paper with the following quote:    "I hold this book [Ulysses] to be the most important expression which the present age has found; it is a book to which we are all indebted, and from which none of us can escape. "         Ã‚   T.S.   Elliot Buy Essay Online: Comparing Homer's Odyssey and Joyce's Ulysses Comparing Homer's Odyssey and Joyce's Ulysses  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚   This essay will analyze the style, genre and plots of the "Hades" episodes found in Homer's Odyssey and Joyce's Ulysses. Before entering this small treatise, it is important to understand the etymology of the word Hades, since it is the setting for both Joyce and Homer (of course in Homer's case, he was speaking of the literal aidhs and Joyce was referring to the graveyard, where Bloom attends the funeral of Paddy Dignam and "broods about the death of his only son ").   Homer's use of the word Hades   was to refer to the abode of the dead or the unseen nether world; where we find Odysseus searching for Tiresias, to find out how to return to Ithaca safely.   The Homeric Hades is not the modern view of Hell, mentioned in the Old and New Testaments.   In fact, C.S. says   "In real Pagan belief, Hades was hardly worth talking about; a world of shadows, of decay.   Homer . . . represents the ghosts [in Hades] as witless.   They gibber meaninglessly until some li ving man gives them sacrificial blood to drink. "   Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   Comparing the style: Objective vs. Existential    Eight months prior to the first publication of Ulysses , Joyce penned: "If you want to read Ulysses you had better first get or borrow from a library a translation in prose of the Odyssey of Homer. " Joyce's recommendation is a must in order to get the full meaning of his work.   A good commentary    would also be found useful in exegesis.   Most people, ". . . opening Ulysses at random are easily scarecrowed away by the first shock of [its] queer mixture of vulgar slang and metaphysical obscurity. " I must admit that my first reading of Ulysses   was horrifying.   I am a lover of the western class... ...oehrich, Rolf. The Secret of Ulysses. (Folcroft, PA: Folcroft Press, 1969)    Schutte, William, "An Index of Recurrent Elements in Ulysses: "Hades". James    Joyce Quarterly. Spring 1977: (Vol. XIV, No. 3)    Skeat, Walter. Concise Dictionary of English Etymology. (Great Britain:Wordsword, 1993)    Smith, William. Wordsworth Classical Dictionary. (London: Wordsworth Editions, 1996)    Smith, Paul. A Key to the Ulysses of James Joyce. (New York: Covici Friede, 1934)    Thornton, Weldon. Allusions in Ulysses. (North Carolina: UNC Press, 1968)    The student may wish to begin the paper with the following quote:    "I hold this book [Ulysses] to be the most important expression which the present age has found; it is a book to which we are all indebted, and from which none of us can escape. "         Ã‚   T.S.   Elliot

Best Day Ever Essay

â€Å"Brandon, I just don’t think it’s wise of you to take your car your freshman year of college,† my mother said every time we passed a state. My mom and I had been taking turns driving a car my father bought me in Texas back to Georgia. . Although I would have loved to spend my Saturday with friends back at home, driving my new car from Texas to Georgia on a Saturday wasn’t that bad. I was just so determined to show off my brand new silver 2010 Toyota Camry LE, I didn’t care what anyone said because that car was coming with me to Valdosta State University fall of 2012. I woke up on Sunday anxious to drive my car to church and show it off to all my friends. I was still a bit tired from the night before, after driving all day and downloading tons of songs to add to my playlist that was entitled â€Å"Toyota Tunes†. â€Å"Brandon, while you’re in church, I want you to pray and ask God what you think you should do with your car,† my mother said towards my closed door while I was getting dressed. â€Å"Okay, Mom, but my mind is pretty much made up,† I replied instantly. After I finished getting dressing, I waited for my mother in my car to finish getting dressed in the house. Being behind the wheel of your first car is one of those capturing moments many people get to feel at least once in their life. All I could think about while awaiting my mother’s arrival was all the friends I’d have in college with my cool car. I had visions of girls way out of my league not liking me for who I was, but for what I drove. An d for the funniest reason, I was content with that. As I pulled out of the driveway, my heart began to race and my fingers started to sweat from the grip I had on my steering wheel. Nothing had ever felt so sweet than to watch my neighbors look at me after getting their Sunday paper and see whose car it was I was driving. â€Å"I want you to say the morning prayer in your new car,† my mom said after turning down the gospel music she had blasting through my speakers. The morning prayer was something my mother and I would do whenever she would drop me off at school or another morning activity. It was also our way of airing out any dirty laundry we had with each other by saying our problems aloud to God and whoever else was around to listen. â€Å"Alright mom, I’ll pray. Dear Heavenly Father, I come before you today asking for your protection through these highways and streets. I also pray that you can give my mother an ease of mind and let her know that I will be safe my freshman year with my car. She should have nothing to worry about because she should believe that You will protect me every mile I drive no matter where I drive. If she doesn’t believe that, then maybe that’s something You and her should discuss. In Jesus’ name, Amen.† â€Å"Amen,† she said in an unpleasant manner. â€Å"Disobeying your mother is not of God, Brandon†, she said when we pulled up to the church â€Å", But this is your car and you’re a grown man. Just don’t be surprised if God gives you a sign telling you that you should listen to me on this one. After church, I told my mom that I would take her home, pick up some friends and hang out at one of my good friends’ house for a bit. â€Å"How long will you be out? Because you leave for school in three days and there are still a lot of things you need to do before you go.† â€Å"I’ll be back by ten, I promise,† I said as I grabbed my keys off the counter to get my friends. This would now be my official first time driving my car alone. This was the moment I’ve been awaiting since my father first told me he bought a car for me fresh off the lot in cash. My mother waived at me from the window shaking her head. You ever get that feeling that something is about to happen, but you don’t know what it is. With a very strange gut feeling beginning to occur, I waived back to my mom while wiping the sweat off my hand â€Å"Bittersweet Symphony† by The Verve was my first song of choice. The song is actually about 6 minutes, which is about as lon g as it took for me to get to my friend Marquell’s house. â€Å"Come outside. I’m right around the corner,† I told him over the phone, not mentioning my new car. When he came outside, the look on his face was priceless. â€Å"So this was the ‘little something’ your dad got you for graduation!?† The minute he climbed into the passenger seat, he instantly turned my radio to his Sunday easy listening channel he would always turn to in his beat up Camero. On our way to my friend Diamond’s house, she called me and asked if we could pick up some snacks for the movie we were going to watch when we got to her house. On my way to the store with my friend Marquell, we had the most intellectual conversation on which television shows expanded our minds the most when we were children. â€Å"I don’t care what you say†, Marquell said with confidence,† If it wasn’t for Captain Planet, I wouldn’t be the eco-friendly man I am today. Maybe if you watched more Captain Planet and less He y Arthur, you wouldn’t have all these air fresheners in your car polluting the Earth.† We both took a little time to acknowledge all the Hawaiian Breeze air cleansers I had dangling from my rear-view mirror, as we were approaching a stop light. â€Å"But you can’t tell me my ride doesn’t smell like pineapples and happiness though,† I said to cut the lighthearted tension me and my best friend created. As we pulled into the front of the gas station to get snacks, an old lady behind me honked her horn, attempting to tell me to clear the tail of my car into the parking space so she could get passed. The minute I tapped on the gas pedal, little did I know that my entire outlook on life would change. That was that moment that I got that explanation for that gut feeling. My car had gone into an instant throttle, running clear into the curb in front of me. â€Å"Oh shit, bruh,† my friend Marquell said in disbelief,† I think you fucked something up.† We stared at each other for a moment, not believing the careless mistake I made. The collision happened on the passenger side, so when Marquell got out the car, he was the first one to see the impact damage. When he jumped out the car and looked at my bumper, the face he made at the damage superseded the face he made when he saw my car the first time. â€Å"Tell me it’s not that bad please!† I said at the top of my lungs. I could tell it was already bad by seeing pink fluid running underneath my car when I got out. I honestly don’t think there is enough paper in the world to write the words of unhappiness that flowed from my mouth like an eruption of every foul term I could fathom There was a huge fracture in the middle of the bumper which effected the brake fluid tank to rip open. This also affected the radiator tank, as well. The first person I called was my father to let him know what happened. After that, I called the mechanic he connected me with. The last call I had to make was to my mother, to ask her to come pick me and my friend, Marquell up. This phone call was even harder to make than to my father. The phone only rang once followed by my mother’s voice saying in a subtle tone, â€Å" Before you say anything, know that I told you so before you left†¦Ã¢â‚¬ 

buy custom Chiefdom vs State essay

buy custom Chiefdom vs State essay For that some should rule, and others should be ruled is a thing not only necessary but expedient: from the hour of their birth, some are marked for subjection, others for rule (Aristotle). In ancient times Kingdoms were also referred to as the kingship or monarchy because of its status and the royalty it holds. Both the state and the chiefdom have political and leadership interest though they are distinguishable in terms of structure but similarities in terms of administrative roles. Although Chiefdom is not common in the modern society both the state and the chiefdom were used during the ancient period by different communities. The similarities can also be defined in terms of the natural resources that both the state and the chiefdom govern and maintain. The management is based on the fact that the resources available in the locality can be shared or the revenue it generates can be shared within the community. The primary role of the chief or the president is to ensure that the immediate people who live within the rich resource are the beneficiary. In terms of ownership of the territory, both the state and the chiefdom have their territorial definition. The power to protect the border is vested upon the chief (Chiefdom) and president (state) under a written document such as the constitution. In both societies i.e. chiefdom and state the wielding of power by the rulers was of great essence. Thus was to make sure the status quo is maintained. In order to wield this power the importance of having a strong military force and accumulation wealth by the president and chief of was much stressed. In most cases the kingship or the statehood was considered royal and was accorded much respect and the national status or the chiefdom hood. Bothe the chiefdom and the state had a role to play in the decision making regarding the distribution and budgeting of the finances, distribution and allocation of powers, developmental issues, religious matters and social status of the communities within their jurisdiction. The chiefdom and the state had a settlement pattern based on sedentary many villages and the basis of their relationship was fundamentally dependent on class and residence, although states later developed modern cities (Scarre, 2007). The first states were not disinguishable from the advanced chiefdom, because they had similar administrative structures and population size. The economic activities such as agriculture (horticulture and small scale farming) and trade was common in both the state and chiefdom. However the development of states was preceded by formation of small scale societys referred to as the chiefdom. Te development of the state through the chiefdom can be illustrated in the diagram below: Due to the development of states from the chiefdom there are differences which emerged and are significant and worth mentioning. At the heart of the chiefdom was the kinship which was very strong. The kinship was fundamentally based on the family linkage and lineage where the first or the eldest male in the most senior lineage was the chief. The main responsibility of the chief was to perform ritual and governance while basically maintaining the lineage. At the state level there was no performance of ritual by the leader. This is because the major role of the ruler was to enhance and concentrate on administrative issues and duties. The division of labor at the chiefdom level was by ascriptive category while at the state level a complex division of labor and elaborate stratification was developed. As the state continued to be developed, the clan of the chieftain shifted the emphasis from the kinship to the society at large so as to develop a noble and qualitative lineage (Scarre, 2007). This will help in hiring of specialist such as scribes, priest and soldiers who will play a major role in governing. There are other distinct features which differentiate the state from the chiefdom. The population of the chiefdom span up to thousands but that of the state should be at least 50,000. Whereas the difference between the state and the chiefdom can be intricate, the lines can be drawn in terms of degree or magnitude: more and larger villages or cities: more social strata: more complex division of labor. There is intense exploitation of natural resources at a chiefdom level while at the state level there is development of elaborate institutionalized bureaucracy to control and manage a greater population, large and wide area, and greater intensification of the exploitation of the natural resources. During the evolution of the states, there was emergennce of the capitalist who will amass vast wealth by exploiting market imperfections and market distortions created by the state and use the wealth for economic exploitation especially large scale trading. In a chiefdom setting, the ruling chief is the manager, military leader, judge and priest. This mean that the powers of the ruler are not divided although they are from different sources. At the state level the powers are divided and bureaucratized. Since the state serves people from different cultures and societies, the holders of the offices such as the military and judges should be guided by certain policies and regulations so as to serve without bias and impartiality thus bureaucratic. The state was considered to be a monopoly because it derived its power and force from the explicit legal system and the writings (Scarre, 2007). Another significant distinguishing factor is the decline in the social groups defined by the kinship and the replacement of groups defined by class and residence. On the other hand the state is very important to the typology of language change. The state is able to bring together sufficient force to conquer, incorporate and integrate other societies leading to multiethnic and multilingual state. While the state is considered an egalitarian society the chiefdom is a utilitarian society in terms of labor and market capitalization. It is very important to study the chiefdom because it is the foundation of the state and it helped in the definition of the state in terms of governance and administration. The basis of chiefdom is to enhance societal development through division of labor and careful exploitation of the natural resource available. Chiefdoms were very powerful in terms of controlling labor and managing of enormous natural resources. They could get labor from the commoners, who were considered of low class, and pay them. This method was adopted by the state, thus bringing the essence of studying chiefdom. Therefore, the chiefdom laid an important foundation in the development of structures in terms of administration and governance of the state. The contribution of the chiefdom socio-cultural nature cannot be ignored. This is because it helped in setting the standards which the sate used to incorporate and integrate. Buy custom Chiefdom vs State essay

Impact of Technology on an Organization

Impact of Technology on an Organization Introduction Technology continues to play a pivotal part in the modern business world. Technological advancement steadily continues to become an integral part of the operations any company. Companies continue to adopt new technologies in enhancing their performance. The impacts of these technological adoptions, however, continue to be felt in numerous aspects of the company.Advertising We will write a custom term paper sample on Impact of Technology on an Organization specifically for you for only $16.05 $11/page Learn More The impacts form an internal and external influence to the business of the company. It becomes necessary to analyze the internal and external impacts of any technological adaptation in order to provide room for improvement. This analysis can also enable informed decision making by the board of a company. The Organization The coca-cola company is a multinational company supplying soft drink across globally. The company’s headquarter s lie in Atlanta, Georgia in the United States of America. Over the years, the company continues to create leadership in the manufacturing of non-alcoholic beverages globally. Though it began in 1886 with a single brand of soft drink, that situation has changed over the years. The company run over 500 globally recognized brands across the world. The company has effectively utilized franchise marketing, across the globe, to reach out to its customers in rural settings within third world countries (Dent, 2011). As a global leader within the industry, it employs the use of various technologies for maximizing sales across the world. Listing of the company in the New York stock exchange means that it operates as a limited liability company. The company defines its mission as striving to refresh the world. This, the company seeks to achieve through creating value and making a difference. The company continues to live up to its mission globally. The number of servings delivered daily is es timated at 1.7 billion across over 200 countries. The company utilizes franchised distribution for the distribution of its products worldwide. The company has employed this structure of distributing since 1889. The distributors get an allocation of the territory where they supply coca-cola products. This structure continues to ease the distribution burden on the company as the subcontracted organizations manage the distribution logistics. The company only distributes its products up to the bottlers’ level. The rest of the distribution channel is left to subcontracted companies and individuals. The company contains numerous subsidiaries running the operations of coca-cola in various countries.Advertising Looking for term paper on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More The chairman of the company also acts at the chief executive for the company. The headquarters of the company are in Atlanta. All t he company operations run from that central place. The rest of the services are controlled through subsidiaries of coca-cola. Many of these subsidiaries operate as independent companies although few fall under the ownership of coca-cola. From the inception up to now, the company continues to adopt new technologies in delivering services and products. These technologies come in all operations of the company, from production to distribution. One of the notable technological advancement by coca-cola continues to be the use of vending machines. The impact of these machines on the organization cannot be ignored. The machines continue to play a crucial role in the operations of the coca-cola company. History of the vending machine A vending machine can be described as any machine dispensing items, to customers, automatically upon inserting currency. These machines had been in use since the 19th century when they were first employed commercially. The growing demand for coca-cola products c an be attributed to the integration of the vending machines into the selling system of the company. With a global rise in the demand for products, especially in the populated areas, there came a need for an invention to cater for those numbers. The demand for coca-cola products in office blocks seemed to be rising as days progressed. The mode of selling using sales men could not efficiently cater for the desires of the growing number of customers. This led to the use of automated machines to dispense products to customers. The machines had been used in other industries in dispensing products. Post offices extensively utilized these machines in the sale of postage stamps. Introduction of these machines can be traced to the years after the First World War. Before this time, the company used service packs as a way of catering to large numbers of people in highly populated place. The vending machines allow for a reduced number of employees while supplying the products to a wide range of people (Philippine de TSerclaes, 2007). The technology vending machines were installed in the regions where there was a substantial demand for the products. The employees of coca-cola would only need to check that the levels of the products do not drop. The company first installed the machines in the American region. They were initially installed to enable the company sell to many people and not for convenience. The burden on the employees conducting selling activities was also eased with the adoption of the vending machines. The technology continued to be distributed to other regions of the world following the same criterion of installation. Other competing companies in the industry accelerated the trend. It became common for each soft drinks beverage company to provide an automated vending machine at various selling points across the world.Advertising We will write a custom term paper sample on Impact of Technology on an Organization specifically for you for only $16.05 $11/page Learn More Since the setting in of competition for technology, companies install their vending machines in proximity to competitors. This continues to help companies within the beverage industry achieve improved sales in new regions. In the modern times, these machines are placed in every soft drink outlet in leading cities of the world. The maturity of this technology came with the recognition and the extensive use of technology in almost all industries. In the food industry, the technology of vending machines continues to be used even in the portioning of food. Better control can be achieved when machines are utilized as opposed to the employment of human capital. The technology has allowed for a full time supply of soft drinks in places where this was not possible. The acceptance of this technology by many countries played a significant role in the maturity of the technology. This has seen the machines offering selective services. The soft drink vending machines of the earlier days could only sell a specified brand of drink. The modern machines offer a variety of up to five different brands of soft drinks. The technological advancement has also increased the efficiency of the machines. Privately owned machines can sell not only different brands, but also brands from different companies. Independent machine companies continue to construct machines targeting other establishments like restaurants. The restaurants posses the rights to the machines and can sell a mixture of hot and cold drinks from a single dispensing machine. Owing to numerous regulations set in the 21st century, the technology of vending machines continues to advance in conformity to standards. Impact of vending machine on the organization The adoption of this technology continues to produce immense impact on the operations of the coca-cola company. The global marketing business receives a surmountable boost from the use of vending machines. The various aspects of the company showing significant impacts are discussed below. Customers The company established itself as a global leader in the manufacturing of non-alcoholic soft drinks long ago. Maintaining this position continues to be essential for the company. The use of this technology has impacted the way customers purchase coca-cola products. The vending machines continue to provide refreshments to customers around the globe in a similar manner.Advertising Looking for term paper on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More Customers can access similar quality of drinks whenever they travel to across the entire world. The availability of these products continues to provide the desired satisfaction on the customers. The technology is unified in all countries it is used. This provides customers with a service they can identify from any country. With differing technological advancements around the globe, the use of standard vending machines continues to standardize the technology in different nations. This allows customers from third world countries, to use the machines in developed nations. Employees The coca-cola company contains an estimated 140,000 employee base in all countries where it operates (The Coca-Cola Company, 2011). The company has employed this technology across all regions equally. The employees continue to reap the benefits of the technology. To the employees, the technology allows them to conduct a lot of sales under minimum effort. An employee can singlehandedly sell to an entire offic e block without getting exhausted. The main chores involve replenishing the drinks and other disposable materials in the machine. This makes the selling aspect for the employees extremely easy. The area of coverage by an individual also increases through utilizing this technology. The general output of employees continues to increase as an impact of the adoption of the vending machine technology. The technology has helped create numerous jobs not related to the manufacturing of soft drinks. The company has integrated the services of engineers and programmers to operate the machines. The programmers’ work in the machines includes, adjusting prices when a change occurs. They also work to ensure the prices are maintained globally as the exchange rates for currencies keep on changing. Society The vending machines have also had an impact on society. The society has been transformed immensely through the use of vending machines. The machines have eliminated the salesmen who used to be positioned at strategic points selling coca-cola products. The crowding along the streets of cities across the world caused by these salesmen continues to reduce with the installation of vending machines. Cities continue to improve on the appearance as advertisements can be run on the machines. The machines occupy small spaces and can, therefore, be linked to the de-congesting of pedestrian footpaths in cities. The industry The machines have transformed how selling is conducted in the industry. The use of credit cards in the 21st century continues to be extensively utilized in many industries. Through these machines, the industry has adopted the use of credit cards in the purchase of soft drinks. Some machines have the capability to accept credit card payments for drinks dispensed. This has changed the way purchasing of soft drinks is conducted. The industry continues to experience new technological advancements through the vending machines. The industry has been able to operate many points of sale run directly by the company. While franchising is common as a mode of selling, it cuts the profits a company receives. Elimination of the franchising aspect has increased the level of profits realized by the companies in the industry. The vending machines also help the industry achieve product standardization in terms of packaging (Peter Martin, 2010). Since the machines can only accept cans of a certain size, the companies manufacture that size of cans. This standardization makes purchasing decisions easy to make for customers products based on other considerations apart from appearance. The machines can also be said to limit the design creativity for products. When a company wants to change its packaging design, the vending machine has to be changed. To avoid the expenses that may be incurred, the companies within the industry continue to restrict themselves to old packaging designs. Ramifications of the technology The company continues to encounter numerous c omplications relating to the application of the vending machine technology. Many of the issues of concern for the company are based on the environment and climate change. The material used in the packaging of products available in the machines continues to pollute the environment. Most of the products contained in the vending machines are packaged in plastic of metal. Since a majority of the people who purchase from the machines are on transit, this encourages littering with the packets. The disposal of the packaging material has been an issue of concern within the company. Though the company has adopted the use of recyclable materials, the challenge to curb littering continues to exist. These machines have been faulted as the origin a sizeable percentage of litter found on major cities’ streets. The vending machines have been identified as causing a considerable level of contribution towards gas emission. The United Nations summit on climate change in Copenhagen came up with a solution to reduce greenhouse gas effects. The company and its partners also agreed to use hydro fluorocarbon-free vending machines and coolers by 2015 (The Coca-Cola Company, 2011). This aims at ensuring the company plays a leading role in the conservation of the environment. The challenge to construct vending machines complying with the set rules has been identified by the company as its principal role going into the future. The company continues to urge other companies in the soft drink industry to follow suit in the adoption of hydro fluorocarbon-free coolers and vending machines. Recommendations The adoption of this technology has tremendously improved the operations of the coca-cola company. There can be several recommendations that the company can adopt to deal with the challenges facing the technology. The company should seek to partner with the other players in the industry to come up with environmentally friendly vending machines. This would reduce the costs incurred by the company in the construction and installation of such machines. While reducing costs, this partnership would also allow exchange of technology between the various employees for the companies. The company should seek to work in close relationship with the local authorities within areas where the vending machines are installed. This partnership with the local authorities would enable the company to come up with an innovative way of controlling littering. This would play a crucial role in improving the image of the company in association with clean environments. The company can also sponsor garbage collection companies collecting garbage in areas where littering from coca-cola products seems extensive. The company can be able to play a part in the cleaning of the environment through such a project. The company would be well placed using machines accepting only credit cards and no cash. As the company heads into the future, such machines would eliminate the problem of cash collectio n. Numerous incidents have been reported of employees being attacked after collecting money from machines. This would also reduce the losses incurred by the company when a machine is attacked. Losses in such scenarios would only be of the unsold drinks. In the current system, successful burglary of a machine results in the loss of the unsold drinks and the sales. Using electronic payments, the company can secure the sales in the event of a burglary act. Such machines can also ensure profitability as the pricing can be set using a single currency. This would ease the problem of converting sales affected by fluctuating rates of different currencies across the world. The company should seek to partner with distributors to provide security in machines located within an area allocated to the distributor. This shall immensely improve reduce cases of burglary of the machines. The machines can also be partly owned by the distributors to ensure the distribution of the risk between the compan y and the distributor. This shall reduce the amount of losses incurred on the company as parts shall be transferred to the distributor. Partnering with distributors can also ensure that the company locates the machines in convenient, strategic locations. The company can utilize the distributor knowledge of the area to identify the strategic positions to place the machines. Conclusion The coca cola company has adopted the use of vending machines to ease the supply of their products. The company continues to advance the technology by improving the machine to comply with modern technology (Peter Martin, 2010). The impacts of the machines on the company have both been negative and positive. With significant advancements and rectifications on the existing machines, the company can improve the profitability of the venture significantly. This would in turn increase the total returns for the company. References Dent, J. (2011). Distribution Channels: Understanding and Managing Channels to M arket (2nd Ed.). London: Kogan Page ltd. Peter Martin, G. H. (2010). Automation Made Easy: Everything You Wanted to Know about Automation and need to ask. New York: International Society of Automation. Philippine de TSerclaes, N. J. (2007). Mind the gap: quantifying principal-agent problems in energy efficiency. Paris: International Enegy Agency. The Coca-Cola Company. (2011). Goals Performance. Web.

The Purpose of the Order in a Rose for Emily Research Paper Example

The Purpose of the Order in a Rose for Emily Research Paper Example The Purpose of the Order in a Rose for Emily Paper The Purpose of the Order in a Rose for Emily Paper To the odder reader, this choice of organization may seems a little strange, but William Faulkner wrote in this way with the purpose of creating suspense, mystery, and sympathy. William Faulkner, in A Rose for Emily, takes a small town scandal and turns it into a heightening story holding the readers attention till the last sentence. Taking the reader from the present to the past creates the essence of mystery, to the reader, by the cleaver use of hermeneutic codes. Starting the story with Emily Gridirons death, cleverly, grabs the readers attention by presenting the question, How did she die? . Another example of Faulkner presenting questions is in one part of the story where the narrator goes back to an account of Miss. Emily banishing the taxes collectors from her house. See Colonel Sartor. , Miss. Emily replied, (Colonel Sartor has been dead almost ten years. ) l have no taxes in Jefferson. Toby! The Negro appeared. Show these gentleman out. So she vanquished them, horse and foot, Just as she had vanquished their fathers thirty years before about the smell. That was two years after her fathers death and a short time after her sweetheart- the en who we believed would marry her- had deserted her. (31 ) Once again, we see the use of hermeneutic codes, and the mystery Faulkner creates. Why cant Emily come to the realization Colonel Sartor is dead? What smell caused the men of the town to confront her? Who was her sweetheart? Why did he leave her? , each a question that increases the mystery within Emails story. Going hand in hand with the mysteriousness of Emily story, is the suspense building throughout the entire narrative. At the beginning of the narrative, the questions the reader falls on are not of the serious nature, Why doesnt she have any axes? , Why has no one been inside her homer, and so on; albeit, as the story progresses William Faulkner adds in the element of suspense. In one part of the story, the narrator refers back to a time when Emily goes to by arsenic. For what? As readers we do not know, Emily refuses to tell. Reading on we find the towns people rumoring about seclude. Is that how she addled The reader Is left hanging in the suspense, as William Faulkner continues his pattern of leaving the reader guessing by moving too different account of Emily life, only heightening the readers interest In the story. Along with suspense and mystery. William Faulkner, creates sympathy for Emily by telling the events of her life in this fashion. We start the story at her visitation. When she is buried, Faulkner does not say she is buried with her family, but with The ranked Ana anonymous graves AT Nylon Ana concentrate servers won Tell at ten battle of Jefferson. ( 30) As if to start the story by saying she is Just part of the past. Our next account of Emily is as an old lady, bitter and uncaught-up to the times, insistent of the fact that she does not have taxes and hardened to the realization of a Emily friends death, of nearly ten years. The next account of Emily is even earlier and we see the town gossiping about the smell of her home and the way she has her man servant clean the place. Later, it is speculated that Emily is considering suicide; no longer wanting to live in a world that is ageing around her, subjected to be the talk of the town, and abandoned by her lover. William Faulkner, tells the events of Emily life in an order that makes her sympathetic to the reader, which is why, when Faulkner finally comes back to the present and reveals that Emily is truly a cerographical homicidal psychopath, it hits the reader with a profound effect. Had William Faulkner told the events of Emily Gridirons life in chronological story would have lost its mystery and suspenseful effect on the reader. Also, it would have made it a lot more difficult to sympathize with Emily if we had heard of her life, the rich girl who had everything growing up, from start till finish. By telling the events of Emily life out of order, Faulkner, opens up the mind of the reader. Forcing the reader to draw conclusions, read deeper into the meaning of events, and ultimately causes the reader to be shocked by the ending.

Annotated Bibliography Example | Topics and Well Written Essays - 250 words - 2

Annotated Bibliography Example Notable discipline problems recorded in the article include but not limited to bullying, violence, vandalism and disruptive classroom behaviour. Such problems have been identified for creating unsafe academic environment, posing threats to entire population in the learning environment. As such the authors have emphasised on the need of reinforcing positive behaviour among the students to curb antisocial and indecent behaviour. This article is intended for instructors engaged in educating students. This article is highly important because it exposes school stakeholders to a new form of behaviour intervention strategy particularly Web-Based Behaviour Intervention. This piece of literature describes the rate at which the Web-based intervention is growing with respect to behavioural change. A review of the methodological issues pertinent to successful implementation of web based behavioural intervention has been widely covered by the authors. For instance the author covered methodological issues associated with the engagement, recruitment and social validity of the participants. The authors insist on appreciating the value of web based intervention from a broader perspective of behavioural change research. As such the authors suggested that web based needs to be applied in the public health to assist in dealing with behavioural disorders among adolescents and children. This article sheds light on the effectiveness of effective classroom management especially instruction strategies applied by teachers in influencing the behaviour of students to attain positive results. According to the authors, the ability of teachers to attain positive academic results relies heavily on their ability to organize classrooms and effectively manage student behaviour. The article also emphasises on the ability of the new teachers to remain in their career for long taking into consideration that resilience in teaching career is highly influenced by

Coca Cola and their Marketing techniques Case Study

Coca Cola and their Marketing techniques - Case Study Example In recent years due to increased competition the company has involved itself in ownership of franchises all over the world. The coca-cola company produces a wide range of products, including: soft drinks (Coke, Fanta, and Sprite), Mineral water (Dasani), non-carbonated beverages (PowerAde sports beverage, flavored tea Nestea). In general the Coca-Cola Company (TCCC) only produces syrup concentrate which is then sold to various bottlers throughout the world who hold a Coca-Cola franchise. Coca-Cola bottlers, who hold territorially exclusive contracts with the company, produce finished product in cans and bottles from the concentrate in combination with filtered water and sweeteners. The bottlers then sell, distribute and merchandise the resulting Coca-Cola product to retail stores, vending machines, restaurants and food service distributors. The Coca-Cola Company offers nearly 400 brands in over 200 countries, besides its namesake Coca-Cola beverage. Diet Coke was introduced in 1982 to offer an alternative to dieters worried about the high number of calories present in Classic Coke.2 The Company also introduced new soft drinks to satisfy a widening spectrum of tastes. Born in Germany, Fanta was introduced in the United States in 1960; today the Fanta family of flavored soft drinks has become one of the best-selling brands in the world. Sprite, a lemon-lime drink, followed in 1961, and in 1963 the Company introduced TAB, its first low-calorie beverage. In 1960 the Minute Maid Corporation merged with the Company, adding frozen citrus juice concentrates and ades under the trademarks Minute Maid and Hi-C to the Company's array of beverages. The Coca-Cola Company offers nearly 400 brands in over 200 countries, besides its namesake Coca-Cola beverage. This includes other varieties of Coca-Cola such as Diet Coke (introduced in 1982 ), which uses aspartame , a synthetic phenylalanine -based sweetener , to eliminate the sugar content of the drink; Caffeine-free Coke ; Cherry Coke (1985); Diet Cherry Coke (1986 ); Coke with Lemon (2001 ); Diet Coke with Lemon (2001); Vanil la Coke (2002 ); Diet Vanilla Coke (2002); Coca-Cola C2 (2004 ); Coke with Lime (2004 ); Diet Coke with Lime (2004 ); Diet Coke with Splenda (2005 ), Coca-Cola Zero (2005), Coca-Cola Black Cherry Vanilla (2006) , Diet Coca-Cola Black Cherry Vanilla (2006), and Coca-Cola Black Tab was Coca-Cola's first attempt to develop a diet soft drink, using saccharin as a sugar substitute. Introduced in 1963, the product is still sold today, however its sales have dwindled since the introduction of Diet Coke. The Coca-Cola Company also produces a number of other soft drinks including Fanta (introduced circa 1942 or 1943) and Sprite. Fanta's origins date back to World War II

Changing the Legal Drinking Age in Michigan Essay

Changing the Legal Drinking Age in Michigan - Essay Example As defined by Cambridge International Dictionary, alcohol is an item for consumption produced when manufacturing wine, beer and liquor. People who drink these products tend to have behavioral change causing them to do inappropriate acts. Â  Alcohol contains substances that can affect a human body especially its way of thinking and act on things. It is said that people under the influence of alcohol became fearless in saying their feelings toward another person; they also tend to be bold on doing things. They think that when they take alcohol it makes them better and boosts their self-esteem. Â  Legal age as defined by the dictionary is the right age wherein an individual enters adulthood wherein lawful rights and responsibilities should be followed. The legal drinking age in Michigan - a state in the East North Central United States that consist two peninsulas separated by water was 21 years old. Â  In this research, a variety of facts and opinions will be discussed so as to oppose the minimum legal drinking age (MLDA) also known as the Uniform Drinking Age Act of 1984 wherein the MLDA will be 21 years of age. On the other hand, certain facts will also be given to support the 21 years of age as the legal drinking age. The research was done to present both sides of the issue regarding on changing the legal drinking age; considering 18 years of age as the legal age. ... Â  A person who reached his/her legal age is therefore according to the law allowed to vote, to have a license and to apply for a job. Â  Undeniably, age is one of the many factors to be considered in selling alcoholic beverages but to look into a larger picture, 21 years of age is old and mature enough to be responsible in his/her action/s. The law says a citizen can vote at the age of 18 because maybe they believe that this age, teenagers are responsible enough to know the laws and policies of the country and yet they are not allowed to drink. If we are to compare voting and drinking, I personally think that voting requires more knowledge and maturity compared to drinking. Another fact is that manufacturers of these products did not lack anything to their consumers for they have warning/s on their advertisements like the famous tagline of beer, "Drink Moderately." Â  According to an article, on an Amethyst Initiative - an effort done by McCardell wherein a number of college presidents were called, college presidents signed a statement saying, "Twenty-One is Not Working." In lieu with the statement here are the reasons supporting the statement (1) a society of risky, clandestine binge-drinking has been made and is usually done outside the campus (2) there was no positive behavioral change with the students.

Database Logic and Management questions Module 2 Article

Database Logic and Management questions Module 2 - Article Example However, we still need a logical design for the reason that building a physical design without logical design is similar to building a house without blueprints. In fact, the basic purpose of building a logical database design is to ensure that all the entities and their possible relationships required by the database are entirely and exactly identified and described. In view of the fact that logical database design is built using easy to understand symbol and language, hence it can be easily examined and validated as accurate by the end-users. As discussed above, this logical database design works as a guide that is to be followed by the database developers to use as a "blueprint" for developing the physical database model. In this scenario, the information provided in the logical database model is utilized to describe the relational tables, entities, stored procedures, primary and foreign keys, and triggers (Liberty University, 2013). In the past few years, the use of information systems in the healthcare industry has raised to a huge extent. In this scenario, organizing and administrating healthcare resources has turned out to be a challenge in opposition to time, for the reason that having control over the expansion of the disease is now as significant as treating it. Additionally, computerization and automation of clinical firms through information systems containing large databases offers a large number of benefits. In addition, in many researches authors have emphasized on the need to be aware of the situational aspects that force individuals’ comfort with receiving and distributing healthcare information in an electronic arrangement. In this scenario, one suggestion is to investigate severer rule of medical information, for instance, to make sure that stakeholders evidently recognize who they are, for what reason they will collect and distribute the data, what kind of data they will take and even to pose any limitations and restrictions

Discussion Week 5 New Product Development and The Product Life Cycle Assignment

Discussion Week 5 New Product Development and The Product Life Cycle - Assignment Example that would initially enhance product awareness and sustain efforts for product recall; and (2) maintaining an effective competitive pricing strategy that would affirm the product’s core competencies and advantage over its competitors through time. An effective and well sustained advertising and promotional campaigns would ensure that the target market would be aptly aware, persuaded to purchase, and affirm loyalty to the product. Likewise, through these efforts, loyal customers would also invite others to purchase the product. On the other hand, maintaining a competitive pricing strategy would assist in confirming that customers would prefer purchasing their product due to other features, in conjunction with their competitive prices, as compared to those charged by competitors. As such, by not pricing the product way above competition or way below, customers would acknowledge preference to their product over their product life cycle. 2. From the e-Activity (Video) located at bottom, imagine you are on the marketing team for the Smart Car Company, which is looking to expand its current automobile offerings. First, propose one (1) possible new product or extension that your team could offer to either Smart Car Company’s existing target or a new target market. Next, formulate one (1) strategy for marketing your product to your selected market. Justify your response by comparing your strategy to the current Smart Car market and the challenges it is strategically facing. A possible new product extension that could be offered to a new target market for the Smart Car Company (Chapter 8: New Products, n.d.) is focusing on offering this to young professionals who are just beginning to exhibit professional growth. Due to the extremely good price which is considerably low, young professionals could be targeted as potential new clients who could easily afford to buy this. After defining this new target market, the strategy to market this product would be designed as

Database Logic and Management questions Module 2 Article

Database Logic and Management questions Module 2 - Article Example However, we still need a logical design for the reason that building a physical design without logical design is similar to building a house without blueprints. In fact, the basic purpose of building a logical database design is to ensure that all the entities and their possible relationships required by the database are entirely and exactly identified and described. In view of the fact that logical database design is built using easy to understand symbol and language, hence it can be easily examined and validated as accurate by the end-users. As discussed above, this logical database design works as a guide that is to be followed by the database developers to use as a "blueprint" for developing the physical database model. In this scenario, the information provided in the logical database model is utilized to describe the relational tables, entities, stored procedures, primary and foreign keys, and triggers (Liberty University, 2013). In the past few years, the use of information systems in the healthcare industry has raised to a huge extent. In this scenario, organizing and administrating healthcare resources has turned out to be a challenge in opposition to time, for the reason that having control over the expansion of the disease is now as significant as treating it. Additionally, computerization and automation of clinical firms through information systems containing large databases offers a large number of benefits. In addition, in many researches authors have emphasized on the need to be aware of the situational aspects that force individuals’ comfort with receiving and distributing healthcare information in an electronic arrangement. In this scenario, one suggestion is to investigate severer rule of medical information, for instance, to make sure that stakeholders evidently recognize who they are, for what reason they will collect and distribute the data, what kind of data they will take and even to pose any limitations and restrictions

Effective vs. Ineffective Language Essay Example | Topics and Well Written Essays - 250 words - 1

Effective vs. Ineffective Language - Essay Example Ineffective language happens as a result of failure of attainment of certain goals set, as a result of stress and pressure in the process of work. Such stress leads to use of a communal language that develops in the setting where there is stress. Language and euphemism develop in form of group terms from group thinking such as ‘credibility and cultivating a ‘you attitude.’ In organizations, the jargon is useful for developing motivation among workers to work toward a certain cause and goal. It is an effective language in creating motivation among workers. Such jargons are useful for stirring self-drive in places of work. They are especially effective where users and learners of language are involved. Creating a ‘you attitude’ may serve in more than one field as means of development. Use of language like this and jargon among a group of people creates a communication platform for the workers and new users of a language to develop unity and understanding among themselves. The jargon develops into other modes of language that acts like the first language for the group involved. It provides authenticity and as sense of belonging and extends further to the use of aid in achieving communication through language different from the norm but which is understood among peers, colleagues or other groups that need to communicate amongst

Financial Crisis Recovery Essay Example for Free

Financial Crisis Recovery Essay 1997-1998 Financial Crisis The weaknesses in Asian financial systems were at the root of the crisis that caused largely by the lack of incentives for effective risk management created by implicit or explicit government guarantees against failure. The weaknesses of the financial sector also were masked by rapid growth and accentuated by large capital inflows, which were partly encouraged by pegged exchange rates. In the mid-1990s, a series of external shocks began to change the economic environment the devaluation of the Chinese Renminbi and the Japanese Yen, rising of U. S. interest rates which led to a strong U.S. dollar, the sharp decline in semiconductor prices; adversely affected their growth. The crisis began in Thailand when the Thai baht collapse of in July 1997 with a series of speculative attacks on the baht extended after quite a few decades of outstanding economic performance in Asia. As the U.S. economy recovered from a recession in the early 1990s, the U.S. Federal Reserve Bank under Alan Greenspan began to raise U.S. interest rates to head off inflation. This made the U.S. a more attractive investment destination relative to Southeast Asia, which had been attracting hot money flows through high short-term interest rates, and raised the value of the U.S. dollar. For the Southeast Asian nations which had currencies pegged to the U.S. dollar, the higher U.S. dollar caused their own exports to become more expensive and less competitive in the global markets. At the same time, Southeast Asias export growth slowed dramatically in the spring of 1996, deteriorating their current account position. Many economists believe that the Asian crisis was created not by market psychology or technology, but by policies that distorted incentives within the lender–borrower relationship. Impacts of the crisis to the South East Asia Most of Southeast Asia and Japan having currency depreciation, devalued stock markets and other asset prices, and a precipitous rise in private debt. It were resulting large quantities of credit became available generated a highly leveraged economic climate, and pushed up asset prices to an unsustainable level. These asset prices eventually began to collapse, causing individuals, financial institutions and corporations in the affected countries were bankrupt. A change in market sentiment could and did lead into a violent of currency depreciation, insolvency, and capital outflows, which was difficult to stop. In the year after collapse of the baht peg, the value of the most affected East Asian currencies fell 35-83% against the U.S. dollar (measured in dollars per unit of the Asian currency), and the most serious stock declines were as great as 40-60%. Lenders led to a large withdrawal of credit from the crisis countries, causing a credit crunch and further bankruptcies. Foreign investors attempted to withdraw their money; the exchange market was flooded with the currencies of the crisis countries, putting depreciative pressure on their exchange rates. As a result, short-term economic activity has slowed or contracted severely in the most affected economies like inflation and rising in unemployment. It impossible that the government doing nothing when the crisis happened to their country. To prevent currency values collapsing, countries governments raised fiscal spending in domestic interest rates to exceedingly high levels (to help diminish flight of capital by making lending more attractive to investors) and to intervene in the exchange market, buying up any excess domestic currency at the fixed exchange rate with foreign reserves. But when interest rates were very high, it can be extremely damaging to an economy that is healthy, wreaked further havoc on economies in an already fragile state, while the central banks were hemorrhaging foreign reserves, of which they had finite amounts. As a strategy to maintain competitiveness, policies to strengthen the country’s balance-of-payments account were pursued. For example, exports were encouraged and imports were discouraged, the latter through an increase in import taxes on certain goods and services. Measures to increase exports for providing handouts directly to people affected included reducing the cost of doing business through such means as tax incentives to boost the manufacturing, agriculture, and services sectors. In the case Malaysia for example, there are policies regarding 1997 crisis: Denial and hesitation, the Malaysian government denied that there was a crisis in the first place; Tight fiscal and monetary policies, and restructuring the banking system; Government proposed to use regional currencies instead of the US dollars in inter-ASEAN bilateral trade; and Financing the recovery programs with the total cost of all measures was RM62 billion. While in the case of Indonesia, the government providing assistance to the poor like efforts to shield poor and vulnerable sections of society from the worst of the crisis, by deepening and widening social safety nets and devoting substantial budgetary resources to increasing subsidies on basic commodities such as rice; measures to increase transparency in the financial, corporate, and government sectors; and steps to improve the efficiency of markets and increase competition. Another example of helping the poor and needy, government must be fair and redistribute the wealth equally to them according their basic necessities of life. In Malaysia, the practicing of zakat system and waqaf contribution to help the poor and needy indirectly will benefit the society. Moreover, Bank Rakyat and ar-rahnu market on Islamic pawn-broking will help the small and medium enterprise to expend their business. Government also must allocate the budget expenditure for subsidizing mainly on education, healthcare and housing for the people. The International Monetary Fund (IMF) is an international organization that provides financial assistance and advice to member countries. It was created out of a need to prevent economic crises like the Great Depression. With its sister organization, the World Bank, the IMF is the largest public lender of funds in the world. It is a specialized agency of the United Nations and is run by its 186 member countries. Membership is open to any country that conducts foreign policy and accepts the organizations statutes. The IMF is responsible for the creation and maintenance of the international monetary system, the system by which international payments among countries take place. A core responsibility of the IMF is to provide loans to member countries experiencing actual or potential balance of payments problems. This financial assistance enables countries to rebuild their international reserves, stabilize their currencies, continue paying for imports, and restore conditions for strong economic growth, while undertaking policies to correct underlying problems. Unlike development banks, the IMF does not lend for specific projects. It thus strives to provide a systematic mechanism for foreign exchange transactions in order to foster investment and promote balanced global economic trade. To achieve these goals, the IMF focuses and advises on the macroeconomic policies of a country, which affect its exchange rate and its governments budget, money and credit management. The IMF will also appraise a countrys financial sector and its regulatory policies, as well as structural policies within the macroeconomic that relate to the labor market and employment. In addition, as a fund, it may offer financial assistance to nations in need of correcting balance of payments discrepancies. The IMF is thus entrusted with nurturing economic growth and maintaining high levels of employment within countries. The large financial packages which the IMF has arranged for countries affected by the Asian crisis and its result have stimulated a debate both among policy-makers and academics as to their costs and benefits. The IMF’s role in providing financial assistance to its members in overcoming short-term balance-of-payment difficulties generally has been evident. Advantages and disadvantages of IMF The IMF offers its assistance which it conducts on a yearly basis for individual countries, regions and the global economy as a whole. However, a country may ask for financial assistance if it finds itself in an economic crisis, whether caused by a sudden shock to its economy or poor macroeconomic planning. A financial crisis will result in severe devaluation of the countrys currency or a major depletion of the nations foreign reserves. In return for the IMFs help, a country is usually required to embark on an IMF-monitored economic reform program, otherwise known as Structural Adjustment Policies (SAPs). An IMF loan provides a cushion that eases the adjustment policies and reforms that a country must make to correct its balance of payments problem and restore conditions for strong economic growth. Supporters argue that the IMF can also impose necessary reforms on an economy. Reforms such as privatization, fiscal responsibility, control of Money supply, and attacking corruption. These policies may cause short term pain, but, are essential for preventing future crisis and long term development. Substantial financial advantages are attached to IMF credits because debtor countries benefit from lower debt service costs. Moreover, commercial banks often demand agreement with the IMF before lending is resumed and generally will charge lower interest rates to countries with an IMF program. The benefits attached to the IMF loan can be regarded as a compensation for the policy adjustments which the debtor countries carry through. At the same time, thanks to the unique role the IMF can play, the costs involved for the creditor countries seem to be rather limited, as the opportunity costs of forgoing the proceeds of alternative investments are relatively small. By temporarily providing finance and at the same time fostering adjustment, member countries could overcome external problems without overly detrimental measures either for their own population or for other countries. The interest rates charged by the IMF in normal circumstances can be relatively low, because the special role of the IMF in the international financial system reduces the risks for the IMF itself as well as for the creditor countries which have provided the resources. Because of its special position the IMF can mitigate the risks attached to its loans. Helped by its low funding costs, the IMF can charge debtor countries lower interest rates than private sector participants which have to charge high spreads because of the sovereign risks involved. Over time, the IMF has been subject to a range of criticisms, generally focused on the conditions of its loans. The IMF has also been criticized for its lack of accountability and willingness to lend to countries with bad human rights record. On giving loans to countries, the IMF makes the loan conditional on the implementation of certain economic policies. These policies tend to involve: * Reducing government borrowing Higher taxes and lower spending * Higher interest rates to stabilize the currency. * Allow failing firms to go bankrupt. * Structural adjustment. Privatizations deregulation, reducing corruption and bureaucracy. The problem is that these policies of structural adjustment and macroeconomic intervention make the situation worse. For example, in the Asian crisis of 1997, many countries such as Indonesia, Korea and Thailand were required by IMF to pursue tight monetary policy (higher interest rates) and tight fiscal policy to reduce the budget deficit and strengthen exchange rates. However, these policies caused a minor slowdown to turn into a serious recession with mass unemployment. The IMF have been criticized for imposing policy with little or no consultation with affected countries. Jeffrey Sachs, the head of the Harvard Institute for International Development said: In Korea the IMF insisted that all presidential candidates immediately endorse an agreement which they had no part in drafting or negotiating, and no time to understand. The situation is out of hand. It defies logic to believe the small group of 1,000 economists on 19th Street in Washington should dictate the economic conditions of life to 75 developing countries with around 1.4 billion people. Because the IMF lends its money with strings attached in the form of its SAPs, many people and organizations are vehemently opposed to its activities. Opposition groups claim that structural adjustment is an undemocratic and inhumane means of loaning funds to countries facing economic failure. Debtor countries to the IMF are often faced with having to put financial concerns ahead of social ones. Thus, by being required to open up their economies to foreign investment, to privatize public enterprises, and to cut government spending, these countries suffer an inability to properly fund their education and health programs. Moreover, foreign corporations often exploit the situation by taking advantage of local cheap labor while showing no regard for the environment. The oppositional groups say that locally cultivated programs, with a more grassroots approach towards development, would provide greater relief to these economies. Critics of the IMF say that, as it stands now, the IMF is only deepening the rift between the wealthy and the poor nations of the world. Indeed, it seems that many countries cannot end the spiral of debt and devaluation. The relatively low interest rates charged by the IMF can lead to moral hazard behavior on the part of the debtor countries. This is largely reduced through the tough policy measures which the IMF imposes as a condition for its programmers. In practice, most countries do not turn to the IMF if not forced by adverse circumstances. Decisions about which countries may borrow money are made by rich countries. Poor countries have little say about loans and the conditions attached to them. The IMF will only lend money to countries if they agree to certain conditions. These conditions increase poverty. The livelihoods of people in poorer countries are destroyed by unfair competition from foreign goods and services. The IMF does not give good financial advice. Countries have suffered by following it. IMF East Asia Case The IMF was involved in one of the worst East-Asian economic crises thus far. Everything started when Thailand was experiencing difficulties in meeting foreign liability obligations so the IMF intervened by suggested to devalue the Baht. The same suggestion was made to Indonesia, Korea and the Philippine. Soon, South Korea and Taiwan jumped in the trend and Hong Kong and Singapore dollars faced speculative attack. The crisis spread all the way to South America where Brazil and Argentina currency came under attack, but they both stood their grounds and refused to devalue which might have prevented a global financial crisis. Other aspects of the handling of the case that were looked down upon were the issue of the bail-out and the political situation of the borrowing country had once again been ignored. Thailand had already borrowed from the IMF and they were bailed-out very publicly which gave an incentive for surrounding countries to follow very risky projects or decisions, believing that the IMF would be a safety net as opposed to a lender of last resort. This is what happened in South Korea when large, unprofitable investment projects were undertaken, largely due in part to the conglomerates of businesses that are close to the bureaucracy but more importantly, sponsored by the IMF. Likewise, Fund officials protested that many East-Asian countries needed a reform in the banking system and governance, where bad banking, nepotism and corruption do not help create stable and efficient economies. During August December 1997, the International Monetary Fund signed three emergency lending agreements with Thailand (August), Indonesia (November), and Korea (December). These programs established packages of international financial support at an unprecedented cumulative sum of approximately $110 billion, based on the financing commitments. During the period August to December, the IMF programs failed dramatically to meet the objective of restoring market confidence. In all three countries, the exchange rate was expected to stabilize, but in fact quickly depreciated far below the targets set in the program, and this despite a very sharp increase in interest rates. Foreign investors remained unconvinced about the debt servicing capacity of the private debtors despite the announced availability of IMF loans, and continued to demand the repayment of short-term loans as they fell due. The IMF programs failed to achieve their goal of maintaining moderate economic growth in the Asian countries. The programs also failed on several intermediate goals, including the preservation of creditworthiness, the continuation of debt payments, and the stabilization of the exchange rate at levels that prevailed upon the signing of the original lending agreements Indonesia was deeply affected by the 1997–1998 crises, more so than its East Asian neighbors. Its economic contraction was deeper and more prolonged. It was the only one to experience a (temporary) loss of macroeconomic control. Eight years have passed since the collapse of Suharto’s New Order regime on the heels of the economic crisis of 1997–1998. During that time, Indonesia’s economy contracted by over 13% in 1998 alone. This followed three decades of virtually uninterrupted rapid economic growth and led to deep social and political crises. Although countries such as South Korea and Thailand were able to overcome their economic crises in a few years, Indonesia’s crisis resolution has been complicated by political instability, at least until 2004, and by a slower recovery. Indonesia was formally under International Monetary Fund management from 1997 to the end of 2003. But the presence of the IMF actually increased the severity of the Indonesian economy, not more than one year after that; there were capital flight out of the country that led to massive unemployment, compounded by the drastic decline in the exchange rate. At the end of 1998 more than 50% of Indonesias population lives below the poverty line. One of the IMFs policy prescriptions is to close 16 banks and it caused the anger of people and withdraws their money in national banks and some foreign banks. In May 1998, due to an agreement between the IMF and Suharto, the government revoked subsidies for food, and raises the price of oil and electricity. This policy had a strong opposition from the people and not long after that, Suharto regime fell. During Megawati regime, in August 2003 the government finally decided not to continue the IMF program and choose to enter the post-program monitoring. The government option raises the consequences that are not much different. IMF can still continue to dictate economic policy in Indonesia because the government still had to consult every economic policy that will be taken with IMF. The Indonesian government announced that they would pay the remaining debt to the IMF, totaling U.S. $ 7.8 billion, within 2 years. It seems to be the correct political decision to break away from the economic policy interventions that has continued since the crisis in 1997. 2008 Financial Crisis Triggered by events in The US and EU The cause or trigger of the 2008 global financial crisis was the boom of the United States housing bubble which peaked in approximately 2005–2006. Since banks began to give out more loans to potential home owners, housing prices began to increase. The increase in house price and improvement of construction activity started around 1992. At that time the Federal Reserve was holding its policy interest rate at an unusually low level by the standards of the past few decades. The good times lasted until 2005, when monetary policy was tightening after another spell of low interest rates. Over that period, construction activity contributed 1/5 percentage points annually to the growth rate of real GDP, and the share of employment in construction and finance, out of the total workforce, rose from 10 ¼ percent to 11 ¾ percent. That is, over this period, of the 27.4 million people added to work rolls (which ended 2006 with a total of 136 million), 4.8 million were directly related to construction and fifi nance. Finally, the nation was left with an excess stock of housing. A contraction in construction transpired to wind down the inventory overhang, which is often a feature of economic slowdowns and recessions. In addition to that, easy lending standards also contributed to the Real estate bubble. Loans of various types (e.g., mortgage, credit card, and auto) were easy to obtain. As part of the housing and credit booms, the number of financial agreements called mortgage-backed securities (MBS) and collateralized debt obligations (CDO), which derived their value from mortgage payments and housing prices, greatly increased. That kind of financial innovation attracted institutions and investors around the world to invest in the U.S. housing market. As housing prices declined, major global financial institutions that had borrowed and invested heavily in subprime MBS reported significant losses. While the housing and credit bubbles were expanding, US Government was going a process called financialization. US Government policy from the 1970s onward has emphasized deregulation to encourage business, which resulted in less oversight of activities and less disclosure of information about new activities undertaken by banks and other evolving financial institutions. Thus, policymakers did not immediately recognize the increasingly important role played by financial institutions such as investment banks and hedge funds, also known as the shadow banking system. These institutions, as well as certain regulated banks, had also assumed significant debt burdens while providing the loans described above and did not have a financial cushion sufficient to absorb large loan defaults or MBS losses. These losses impacted the ability of financial institutions to lend, slowing economic activity. The U.S. Financial Crisis Inquiry Commission reported its findings in January 2011. It concluded that the crisis was avoidable and was caused by: 1. Widespread failures in financial regulation, including the Federal Reserve’s failure to stem the tide of toxic mortgages; 2. Dramatic breakdowns in corporate governance including too many financial firms acting recklessly and taking on too much risk; 3. An explosive mix of excessive borrowing and risk by households and Wall Street that put the financial system on a collision course with crisis; 4. Key policy makers ill prepared for the crisis, 5. Lacking a full understanding of the financial system they oversaw; and systemic breaches in accountability and ethics at all levels.[35][36] Table 1 The Causes and Impacts of Global Financial Crisis Taken from Takatoshi Ito â€Å"Comparison of the Financial Crises: Japan and Asia in 1997-1998 vs. U.S. 2008-09† The Collapse of World Trade Although the crisis is originally from financial sector, trade had great implication that hit countries around the world. Exports collapsed in nearly every major trading country, and total world trade fell faster than it did during the Great Depression. From a peak in July 2008 to the low in February 2009, the nominal value of world goods exports fell 36 percent; the nominal value of U.S. goods exports fell 28 percent (imports fell 38 percent) over the same period. Even a country such as Germany, which did not experience their own housing bubble, experienced substantial trade contractions, which helped spread the crisis. The collapse in net export in Germany contributed to the decline in their GDP which put the country into recession. In the fourth quarter of 2008, Germany’s drop in net exports contributed 8.1 percentage points to a 9.4 percent decline in GDP (at an annual rate); Japan’s net exports contributed 9.0 percentage points to a 10.2 percent GDP decline. Real exports fell even faster in the first quarter of 2009. The Decline in Output Around the Globe The financial crisis was rapidly transmitted to the real economy. The financial disruption was so strong and swift in most countries so that their confidence level in economy fell as well. Confidence levels are measured in different ways across countries, but they were generally falling throughout 2008 and reached recent lows in the fall of 2008 and winter of 2009. As noted, world GDP is estimated to have fallen roughly 1.1 percent in 2009 from the year before. In advanced economies, the crisis was even deeper; the IMF expects GDP to have contracted 3.4 percent in advanced economies for all of 2009. For OECD member countries, GDP fell at an annual rate of 7.2 percent in the fourth quarter of 2008 and 8.4 percent in the first quarter of 2009. Despite the historic nature of its collapse, the U.S. economy actually fared better than about half of OECD economies during those quarters. The decline in industrial production across major economies, each of these economies in January 2009 was more than 10 percent below its January 2008 level, and Japan faring far worse relative to the other major economies. Impact on Developing Countries The impact of the crisis on developing countries will affect different types of international resource flows: private capital flows such as Foreign Direct Investment (FDI), portfolio flows and international lending; official flows such as development finance institutions; and capital and current transfers such as official development assistance and remittances. The World Association of Investment Promotion Agencies foresees a 15% drop in FDI 2009. FDI to Turkey has already fallen 40% over the last year and FDI to India dropped by 40% in the first six months of 2008. FDI to China was $6.6 billion in September 2008, 20% down from the monthly average in year 2008 so far, and mining investments in South Africa and Zambia have been put on hold. The crisis has led to a drop in bond and equity issuances and the sell-off of risky assets in developing countries. The average volume of bond issuances by developing countries was only $6 billion between July 2007 and March 2008, down from $ 15 billion over the same period in 2006. Between January and March 2008, equity issuance by developing countries stood at $5 billion, its lowest level in five years. As a result, World Bank research suggests some 91 International Public Offerings have been withdrawn or postponed in 2008. However, not all developing countries were effected tremendously by 2008 financial crisis. In South East Asia we may take a look Indonesia performance towards the 2008 financial crisis. Indonesia experienced a significant macroeconomic shock at the end of 2008. But, of course, Indonesia was not on its own. Indeed, Indonesia was one of the least affected countries in South East Asia. Although GDP growth slowed markedly to 4.4% in the first quarter of 2009, it did not experience the collapse in growth experienced by countries such a Korea, Thailand and Malaysia. Indonesia’s growth in recent years has been driven predominantly by non-tradeables rather than tradeables, and, although the crisis reduced growth across the board, sectors such as transport and communications, and utilities have continued to grow in double digits. At the same time, the tradeable sector which has performed best is agriculture, which, at 4.8%, has experienced its strongest growth since the East Asian crisis, helping to compensate for the effects of the crisis. Indonesia has learnt from 1997 crisis so that they can manage 2008 financial crisis well. The Role of International Institutions of The G-20 The G-20, which includes 19 nations plus the European Union, is the the main nations of much of the coordination on trade policy, financial policy, and crisis response. Its membership is composed of most of the world’s largest economies and makes up nearly 90 percent of world gross national product. The first G-20 leaders’ summit was held at the peak of the crisis in November 2008. At that point, G-20 countries committed to keep their markets open, adopt policies to support the global economy, and stabilize the financial sector. The second G-20 leaders’ summit took place in April 2009 at the height of concern about rapid falls in GDP and trade. Leaders of the world’s largest economies pledged to â€Å"do everything necessary to ensure recovery, to repair our financial systems and to maintain the global flow of capital.† Furthermore, they committed to work together on tax and financial policies. Perhaps the most notable act of world coordination was the decision to provide substantial new funding to the IMF. U.S. leadership helped secure a commitment by the G-20 leaders to provide over $800 billion to fund multilateral banks broadly, with over $500 billion of those funds allocated to the IMF in particular. In September 2009, the G-20 leaders met in Pittsburgh. They noted that international cooperation and national action had been critical in arresting the crisis and putting the world’s economies on the path toward recovery. They also recognized that continued action was necessary, pledged to â€Å"sustain our strong policy response until a durable recovery is secured,† and committed to avoid premature withdrawal of stimulus. They launched a new Framework for Strong, Sustainable, and Balanced Growth that committed the G-20 countries to work together to assess how their policies fit together and evaluate whether they were â€Å"collectively consistent with more sustainable and balanced growth.† Further, the leaders committed to act together to improve the global financial system through financial regulatory reforms and actions to increase capital in the system. It set up emergency lines of credit (called Flexible Credit Lines) with Colombia, Mexico, and Poland, which in total are worth over $80 billion. These lines were intended to provide immediate liquidity in the event of a run by investors, but also to signal to the markets that funds were available, making a run less likely. In each of these countries, markets responded positively to the announcement of the credit lines, with the cost of insuring the countries’ bonds narrowing (International Monetary Fund 2009b). The IMF also negotiated a set of standby agreements with 15 countries, committing a total of $75 billion to help them survive the economic crisis by smoothing current account adjustments and mitigating liquidity pressures. IMF analysis suggests that this program discouraged large exchange-rate f in fluctuate in these countries (International Monetary Fund 2009). These actions as well as the very existence of a better-funded global lender may have helped to keep the contraction short and to prevent sustained currency crises in many emerging nations. The Government Responses The U.S. executed two stimulus packages, totaling nearly $1 trillion during 2008 and 2009. The U.S. Federal Reserves new and expanded liquidity facilities were intended to enable the central bank to fulfill its traditional lender-of-last-resort role during the crisis while mitigating stigma, broadening the set of institutions with access to liquidity, and increasing the flexibility with which institutions could tap such liquidity. United States President Barack Obama and key advisers introduced a series of regulatory proposals in June 2009. The proposals address consumer protection, executive pay, bank financial cushions or capital requirements, expanded regulation of the shadow banking system and derivatives, and enhanced authority for the Federal Reserve to safely wind-down systemically important institutions, among others. The response of the Federal Reserve, the European Central Bank, and other central banks was taken shortly and dramatic. During the last quarter of 2008, these central banks purchased US$2.5 trillion of government debt and troubled private assets from banks. The governments of European nations and the USA also raised the capital of their national banking systems by $1.5 trillion, by purchasing newly issued preferred stock in their major banks. In October 2010, Nobel laureate Joseph Stiglitz explained how the U.S. Federal Reserve was implementing another monetary policy —creating currency— as a method to combat the liquidity trap. By creating $600,000,000,000 and inserting this directly into banks, the Federal Reserve intended to spur banks to finance more domestic loans and refinance mortgages. However, banks instead were spending the money in more profitable areas by investing internationally in emerging markets. The bank bailout, more formally called the Troubled Asset Relief Program, failed to achieve the ultimate goal. The goal of these bailouts from the perspective of the largest financial institution is billions of dollars in taxpayer money allowed institutions that were on the brink of collapse not only to survive but even to flourish. The legislation that created TARP, the Emergency Economic Stabilization Act, had far broader goals, including protecting home values and preserving homeownership. Congress was told that TARP would be used to purchase up to $700 billion of mortgages and to obtain the necessary votes, Treasury promised that it would modify those mortgages to assist struggling homeowners. However, almost immediately, as permitted by the broad language of the act, Treasury’s plan for TARP shifted from the purchase of mortgages to the infusion of hundreds of billions of dollars into the nation’s largest financial institutions, a shift that came with the express promise that it would restore lending. Treasury, however, provided the money to banks with no effective policy or effort to force the extension of credit. There were no strings attached: no requirement or even incentive to increase lending to home buyers, and against our strong recommendation, not even a request that banks report how they used TARP funds. It raised the issues on accountability in providing the bailouts. Lesson Learnt from 2008 Crisis There are several lessons that can be learnt from 2008 financial crisis. Those lessons are stated below : 1. Aggregate volatility is part of market system. There is a need to have more depth study of aggregate volatility. 2. Long lived large firms (such as financial institutions) may not be fully trusted. We should rethink the role of reputation of firms in market transactions. In addition, we need to revisit the key elements of the economy of organization so that reputation should be derived from the behavior not merely from the asset. 3. Economic growth will only take place if there is real increase in the real commodities not financial commodities. 4. People mistakenly equated free markets with unregulated markets. 5. Policy makers should be flexible in their policies and guided by overall national objectives. 6. All trading countries should diversify both their exports composition as well as export destination. 7. World financial system is becoming fragile so that there is a need to reform the current financial system. Islamic based economy system has great opportunity to alter the existing financial system. Islamic perspective From Islamic perspective, the approach that most suitable which is providing handout to the poor and directly to people affected by financial contracts. There were horrible gaps between the rich and the poor all over the world, which remained existent all the time, even after the fall of the planned economy. It goes without saying that the position in developing and under developed countries is even worse. This uneven and unjust system of distribution needs to be reformed on a conceptual basis. The entire world today is crying on the present financial crisis, but few people have realized that this is basically a crisis of rich people who were playing with loads of wealth, and all of a sudden, their income faced a steep fall. So far as poor people are concerned, they have been living in perpetual crisis all the times, but no one care for them, The present crisis should not be examined within the relatively narrow confines of debt; rather, it is fundamentally a question of social justi ce, a concept that is paramount in Islam. Social justice includes three aspects, namely a fair and equitable distribution of wealth; the provision of basic necessities of life to the poor and the needy; and protection of the weak against economic exploitation by the strong. The debt burden, however, is increasing inequality between rich and poor countries and is tantamount to exploitation. It also means that poor countries are often unable to provide the most basic services for their citizens. The huge debt that currently burdens poor countries has arisen from loans that have charged interest and have not shared risk between the lender and the borrower and have, therefore, contravened the two most fundamental principles of Islamic finance. Islamic commands to refrain from charging interest and to share financial risk seek to avoid the concentration of wealth and the economic exploitation of the weak and thereby prevent situations such as the current debt crisis from arising in the first place. The core belief in Islamic finance is that money should not in itself be an earning asset; therefore, Islam prohibits any and all forms of interest. There are also other systems which prevent an economic crisis of pandemic proportions to arise; contractual relationships in business, finance or trade must be based on trust and familiarity of networks of common experiences (takaful) which implies that debts cannot be repackaged and resold as assets globally to faceless investors while profit must be redistributed directly to the poor (zakat) in the Holy month of Ramadan to build and strengthen social safety nets through institutions of charity welfare and education. Over and above zakat, all Muslims pay zakat fitrah to the poor, during the month of Ramadan, either through state collection centers or direct contributions to the poor. There is a trend within rural areas to identify destitute families and the disabled within the underserved rural areas of the State where they reside. Over the last few years, increasing realization of a topic poverty during an economic crisis creating the new poor among the Muslim working classes and a bnormally high repayment rates through unlicensed loan-sharks and licensed money-lenders have made national banking institutions which serve the poorer rural communities shift their services to the Ar-Rahnu market or Islamic pawn-broking market. Currently four Islamic financial institutions, Bank Rakyat (The People’s Bank); the Yayasan Pembangunan Ekonomi Islam Malaysia (Islamic Foundation of Economic Development, Malaysia); Permodalan Kelantan Bhd (Kelantan Investment Co.); and the Agro bank offer such services to the rural and urban working classes. It has established an Ar-Rahnu X’Change Franchise Network, where it plans to provide an Ar-Rahnu franchise throughout the country, managed by reputable cooperatives of the working classes. Given the acute dependency of the working classes on ready cash in times of emergency and the high rates of interest in regular pawn-broking market, there seems to be few alternatives except to expand the Ar-Rahnu market among Muslims and non-Muslims and charge the poor for ‘safekeeping’ services, rather than interest. Despite the fact that loan disbursements of Bank Rakyat alone is among the services which have contributed to Bank Rakyat’s amazing rise as a successful national cooperative bank, giving out higher than normal dividends to its share holders, loan sharks are virtually setting up desks outside flats and apartment buildings of the Muslim poor in towns and cities to offer cash and carry’ facilities to the desperately poor. This lucrative market speaks volumes of the rise of atopic poverty among those on or below the poverty line, the inadequacy of zakat and disbursements of zakat, the high dependency on regular income earners among the middle classes for welfare driven services and products and unclear nature of the rising wealth of the Muslim and non-Muslim upper classes in Malaysia The Islamic finance can bring on significant gains in money released into public capital and infrastructure. The redistributive mechanisms of surplus are instituted into welfare based institutions such as free or subsidized education, health and child care, education, and even publicly directed employment. Its principles may differ from modern welfare economics except the gains at the far end of the redistributive machinery are similarly directed towards the poor. The policies of the New Economic Policy in Malaysia, state welfares in Brunei, or publicly instituted employment as in MENA countries are more Islamic than regul ar, except they are part of the post-colonial ‘reformist’ policies of Muslim states which preceded the modern up-beat drive towards Syaria’ah compliant finance. Islamic finance, however, has not demonstrated a clear connectivity with redistributive justice as in the post-colonial political economy except through instituted deductions of zakat from dividends of shareholders. Profits from credit or financial corporations are not necessarily redistributed through zakat. Furthermore, for borrowers, the appreciated value of assets and services as forecasted and built into systems and rates of repayments which compensate for the lack of interest and, in reality, repayment rates may even out with the regular—rates are generally fixed in advance unlike regular interest rates which are more flexible, varying according to market conditions. However, it does allow more capital to be released into projects immediately, allowing a more extensive amount of goods and services to be produced, without the worry of serving loans. One, however, has to be assured of significant productivity even in the early stages of the loan but payments of zakat accruing from successful investment, from the financier or production from the borrower are fixed at a low rate of 2.5%. It is also consensual rather than forced (as in income taxation) and Muslim countries in general pur sue income tax collections as the more important thrust of national revenue. There are generally two disparate systems at work in Muslim countries Islamic finance and post-colonial welfare instituted economics. The welfare inputs in Islamic countries which are operational today proceed whether or not there are institutions of Islamic finance in the country. In Malaysia, Brunei, and the MENA countries discussed in this paper, components of welfare economics in heavily subsidized education, health, housing, farming, and welfare for the poor, are part of a post-colonial legacy of social reform to institute economic parity across groups and classes. In these Muslim nations, the public sector has played an important role in employment for Muslim or indigenous citizens, often acting as a social safety net in times of economic crises. However, these welfare driven policies are subject to much criticism since they favour the poor, encourage low productivity, and a non-competitive public sector. As Islamic institutions of welfare catch on with progressive social educa tion through media and networks and become an alternative system of welfare for poorer Muslims through zakat and other contributions, welfare increasingly becomes a social responsibility of the Muslim middle classes. There is hardly any data on how the profits earned by larger corporations of Islamic finance actually become instituted into a system of welfare economics based in Islam. Private investment trusts of political elites or national trusts controlled by them. In a properly instituted system of redistribution, through wages, salaries, educational, and health subsidies and so on, there should be very little wealth differential between the owners of political Capital and citizens but economic disparities are significant in these Muslim countries and it has been shown how gains among the lowest 20% may be offset by higher or equivalent gains among the top 20% income earners of these nations. The production of stable professional middle classes in these nations has led to an enrichment of social capital and welfare driven redistributive institutions through social networks but Islamic conscientisation had sometimes moved this ‘spiritual gain’ as an objective reality. The belief i n ibadah or ‘to do good’ may outweigh the call for greater transparency in the use of national collections of zakat and so on. Many Muslims in Malaysia pay both income tax and zakat, rather than ask for exemption from income tax. They also maintain Islamic voluntary organizations with personal funds, donate to mosques and charities, and make endless food contributions to orphans and the poor. There is very little data gathered on the actual amounts paid privately or anonymously and state-directed contributions, although increasing, are not reflective of actual payments contributed by the middle classes towards Islamic charitable institutions. On the other hand, Muslim based banking and financial institutions are obscure in their social responsibility towards the poor, including their own clients who may be victims of topic poverty during times of economic crises. In conclusion, Islamic institutions of trusts which are state directed or privately administered by banking and credit agencies contain more humanistic principles of investment and redistribution of profits except that there is a missing component—between the principles of redistribution of surplus or profits in Islam finance and the actual mechanisms to provide welfare to the people who are not share-holders or stake-holders. In Malaysia, Brunei, and the MENA countries of the Middle East and North Africa, state agencies assume trusteeships over compulsory collections like the zakat but do not have any institutional mechanisms to enforce private corporations local or foreign to contribute towards the welfare of the poor. Conclusion The first Financial crisis was began in July 1997 when the Thai baht collapse with a series of speculative attacks on the baht extended after quite a few decades of outstanding economic performance in Asia and most of Southeast Asia and Japan having currency depreciation. There some approach to help financial recovery, It is impossible that the government doing nothing when the crisis happened to their country. To prevent currency values collapsing, governments raised fiscal spending in domestic interest rates to exceedingly high levels. And last approach Government providing handouts directly to people affected and providing assistance to the poor like efforts to shield poor and vulnerable sections of society from the worst of the crisis The International Monetary Fund (IMF) is an international organization that provides financial assistance and advice to member countries. It was created out of a need to prevent economic crises like the Great Depression. The large financial packages which the IMF has arranged for countries affected by the Asian crisis and its result have stimulated a debate both among policy-makers and academics as to their costs and benefits. However, IMF has also been criticized for its lack of accountability and willingness to lend to countries with bad human rights record Debtor countries to the IMF are often faced with having to put financial concerns ahead of social ones The cause or trigger of the 2008 global financial crisis was the boom of the United States housing bubble which peaked in approximately 2005–2006. The impact of the crisis on developing countries will affect different types of international resource flows: private capital flows such as Foreign Direct Investment (FDI). However, not all developing countries were effected tremendously by 2008 financial crisis, Indonesia was one of the least affected countries in South East Asia. The G-20, is the the main nations of much of the coordination on trade policy, financial policy, and crisis responses. The first G-20 leaders’ summit was held at the peak of the crisis in November 2008. The bank bailout, more formally called the Troubled Asset Relief Program, failed to achieve the ultimate goal From Islamic perspective approach that most suitable which is providing handout to the poor and directly to people affected by financial contracts the present crisis should not be examined within the relatively narrow confines of debt, rather it is fundamentally a question of social justice, a concept that is paramount in Islam. The practicing of zakat system and waqf contribution to help the poor and needy indirectly will benefit the society. And this is the best approach that government should do by providing help directly to the poor and people affected by financial contract namely firms and banks. If government reduced the amount tax to be paid, cost of production will decrease level of employment and production will increase. Meanwhile, banks will bail out to save company and people indirectly reduced the worry of public causing the level of borrowing and consumption raises. So, as a result, it can stimulate the capital investment of the economy to increase the economic growth and level of GPD. References Fadillah Putra, â€Å"Economic Development and Crisis Policy Responses in Southeast Asia (Comparative study of Asian Crisis 1997 and Global Financial Crisis 2008 in Malaysia, Thailand and the Philippines)† (2008), Public Administration Department, Brawijaya University Federal Reserved Bank of San Francisco Economic Letter †What Caused East Asia’s Financial Crisis?† 98-24; August 7, (1998) Hussein Alasrag, â€Å"Global Financial crisis and Islamic finance† (2007) http://www.muftitaqiusmani.com/index.php?option=com_contentview=articleid=41:present-financial-crisis-causes-and-remedies-from-islamic-perspective-catid=12:economicsItemid=15,retrieve on 11 November 2012 http://www.academia.edu/1133515/Global_Financial_Crisis_An_Islamic_Perspectiv e, retrieve on 4 November 2012 http://en.wikipedia.org/wiki/Financial_crisis_of_2007%E2%80%932008#cite_note IMF_Loss_Estimates-31, retrieve on 4 November 2012 Mohamed Ariff, Syarisa Yanti Abubakar,†The Malaysian Financial Crisis: Economic Impact and Recovery Prospects† (1999) The Developing Economies, XXXVII-4: 417–38 Reinhart, V. (2011). A year of living dangerously : The Management of the Financial Crisis in 2008. Journal of Economic Perspective.25 (1). Pg 71-90. Ibid Recovery from the Asian Crisis and the Role of the IMF, IMF Staff (2000) http:// www.investopedia.com/articles/economics/09/international- monetary-fund imf.asp#axzz2EQhoHzz9, retrieve on 4 November 2012 http://www.nrcc.org/default/Issues2012/2012_Issues_Book_Chapter_Financial_Crisis_Bailouts_and_Financial_Reforms [ 1 ]. Federal Reserved Bank of San Francisco Economic Letter: What Caused East Asia’s Financial Crisis? 98-24; August 7, 1998 [ 2 ]. Federal Reserved Bank of San Francisco Economic Letter: What Caused East Asia’s Financial Crisis? 98-24; August 7, 1998 [ 3 ]. www.wikipedia.com [ 4 ]. www.wikipedia.com [ 5 ]. www.wikipedia.com [ 6 ]. Federal Reserved Bank of San Francisco Economic Letter: What Caused East Asia’s Financial Crisis? 98-24; August 7, 1998 [ 7 ]. www.wikipedia.com [ 8 ]. Mohamed Ariff, Syarisa Yanti Abubakar, (1999) The Malaysian Financial Crisis: Economic Impact and Recovery Prospects: The Developing Economies, XXXVII-4: 417–38 [ 9 ]. Economic Development and Crisis Policy Responses in Southeast Asia (Comparative study of Asian Crisis 1997 and Global Financial Crisis 2008 in Malaysia, Thailand and the Philippines) Fadillah Putra, Public Administration Department, Brawijaya University [ 10 ]. Recovery from the Asian Crisis and the Role of the IMF, IMF Staff (2000) [ 11 ]. http://www.investopedia.com/articles/economics/09/international-monetary-fund-imf.asp#axzz2EQhoHzz9 [ 12 ]. http://www.twnside.org.sg/title/sick-cn.htm [ 13 ]. Reinhart, V. (2011). A year of living dangerously : The Management of the Financial Crisis in 2008. Journal of Economic Perspective.25 (1). Pg 71-90. [ 14 ]. Ibid [ 15 ]. Ibid [ 16 ]. Ibid [ 17 ]. Wikipedia. Financial Crisis 2007. Taken from http://en.wikipedia.org/wiki/Financial_crisis_of_2007%E2%80%932008#cite_note-ssrn-8 [ 18 ]. Wikipedia. Financial Crisis 2007. Taken from http://en.wikipedia.org/wiki/Financial_crisis_of_2007%E2%80%932008#cite_note-IMF_Loss_Estimates-31 [ 19 ]. Ibid [ 20 ]. Greenspan-We Need a Better Cushion Against Risk. Financial Times. March 26, 2009. Taken from http://www.ft.com/cms/s/0/9c158a92-1a3c-11de-9f91-0000779fd2ac.html. [ 21 ]. FCIC Report-Conclusions Excerpt-January 2011. Taken from http://c0182732.cdn1.cloudfiles.rackspacecloud.com/fcic_final_report_conclusions.pdf [ 22 ]. CRISIS AND RECOVERY IN THE WORLD ECONOMY. Taken from http://www.whitehouse.gov/sites/default/files/microsites/economic-report-president-chapter-3r2.pdf [ 23 ]. Ibid [ 24 ]. Ibid [ 25 ]. Ibid [ 26 ]. Ibid [ 27 ]. Ibid [ 28 ]. Velde, D. W. (2008). Effects of the Global Financial Crisis on Developing Countries and Emerging Markets. Policy responses to the crisis. INWENT/DIE/BMZ conference in Berlin, 11 December 2008. [ 29 ]. Ibid [ 30 ]. Ibid [ 31 ]. Ibid [ 32 ]. Ibid