The Big Bang Theory Essay Example | Topics and Well Written Essays - 750 words

The Big Bang Theory - Essay Example The big bang theory is yet another one of its kind that seeks to explain the origin of life and the existence of matter and the whole universe. The Big Bang theory is built on the foundation that in the very beginning, estimated like fifteen billion of years ago, the universe was in an infinite form. Nothing was in existence other than the plasma soup. Now, all the energy and the matter were compressed in just one place. Then (Hawking and Ellis 213), a tremendous explosion occurred, that kicked off the process of expanding the universe that forced the universe to take a definite shape. As a result, of this explosion, all particles of matter that were broken into extremely tiny microscopic particles were thrown about, away such that no any single one was close to each other (Hawking & Ellis 215). Thus, from when the big bang occurred, there has been an expansion of the universe endlessly in all directions, thus moving the galaxies to their present day position. The theory asserts that the universe was too hot in the subsequent period following the explosion. Thereafter, all the particles that were thrown all over began to cool down. The cooling down of these particles eventually started the long process of forming matter, by crumpling to each other. As the cooling process continued, it created a conducive environment for the matter to mature. The matter so formed started to decay, as the universe expansion continued. They eventually formed up the composite particles, commonly known protons, neutrons and electrons (Eastman and Missler 112). The composite particles, soon after, started reacting with each other, forming the hydrogen isotope. These are the basis of life, as we know it today. However, many misconceptions relate to this theory. While there is an argument that a massive explosion took place that sent off different particles of matter that are the beginning of life, there is also a counter argument that no actual explosions took place. The proponents of this view (Hawking & Ellis) argue that a series of endless expansion took place. According to them, the expansion created more space and altered the temperatures that initially existed in the universe. This change of temperatures allowed the cooling down of particles, thus creating a desirable condition for the elements of life to thrive. Another counter argument is that (Eastman and Missler 116), at the very beginning, space did not exist. It has developed over time, as does the rest of matter. With such a view, then we cannot know where the energy, matter and the plasma soup existed. The causes of this theory are highlighted by certain underlying opinions (Andreeva 24). First, there is a thought that the universe must have had a beginning (Eastman and Missler 118). Whichever it was, it is not satisfactorily put across. This only serves to seek an explanation for this beginning. Another reason for the establishment of this theory is the fact that the galaxies seems to keep moving away, a clear suggestion that the expansion of the universe does happen. That the elements of life, hydrogen and helium, are found in the universe further needs an explanation (Hawking and Ellis 230), that the big bang theory has sought to provide. The theory also stems from the ideology that some heat residuals should have remained in the universe. This is supported by the discovery of the cosmic microwave that occurred in 1965 (Eastman and Miss

India taj mahal mumbai terror Essay Example | Topics and Well Written Essays - 1250 words

India taj mahal mumbai terror - Essay Example The terrorists were reportedly seized an Indian boat from a fisherman after killing him to reach Mumbai. Moreover, they started their hotel operations after killing the Mumbai police chiefs who tried to block them. Even though many reasons were cited as the reasons for this attack, the major reason is believed to the destruction of the Muslim Mosque Babri Masjid by certain Hindu fundamentalists few years before. Moreover, Pakistani terrorist groups believe that the Indian frontier state Kashmir is part of Pakistan and India possesses it illegally. India and Pakistan engaged in two wars after the independence and the enmity between these two countries is a major threat for peace in South Asia. This paper briefly explains the Mumbai terrorist attack with the help of its cause and effect, culprits, possible prevention strategies etc BBC News (23 Nov 2009) has reported that the religious site where the Babri mosque was destroyed in 1992 in the northern Indian town of Ayodhya has been a flashpoint between Hindus and Muslims for years. India’s relationships with Pakistan have damaged a lot because of the destruction of Muslim Mosque Babri Masjid by certain Hindu fundamentalists. Hindu fundamentalists in India believe that the Babri Masjid was situated at their God Ram’s birth place, Ayodhya and former Mughal King Baber has captured that place and constructed the mosque without the permission from the Hindus. So they believe that Ram’s birth place is a sacred place and a temple should be constructed in that place for worshipping their God Ram. The result was the destruction of the existing mosque in 1992. The effect of the Babri Masjid was not visible immediately. Even thought the Muslim people all over the world were agitated by this act, most of them suppressed their displeasure at that time. India’s image as a secular democratic state in the eyes of the external world has severely damaged because of the above incident. Muslim

The Big Bang Theory Essay Example | Topics and Well Written Essays - 750 words

The Big Bang Theory - Essay Example The big bang theory is yet another one of its kind that seeks to explain the origin of life and the existence of matter and the whole universe. The Big Bang theory is built on the foundation that in the very beginning, estimated like fifteen billion of years ago, the universe was in an infinite form. Nothing was in existence other than the plasma soup. Now, all the energy and the matter were compressed in just one place. Then (Hawking and Ellis 213), a tremendous explosion occurred, that kicked off the process of expanding the universe that forced the universe to take a definite shape. As a result, of this explosion, all particles of matter that were broken into extremely tiny microscopic particles were thrown about, away such that no any single one was close to each other (Hawking & Ellis 215). Thus, from when the big bang occurred, there has been an expansion of the universe endlessly in all directions, thus moving the galaxies to their present day position. The theory asserts that the universe was too hot in the subsequent period following the explosion. Thereafter, all the particles that were thrown all over began to cool down. The cooling down of these particles eventually started the long process of forming matter, by crumpling to each other. As the cooling process continued, it created a conducive environment for the matter to mature. The matter so formed started to decay, as the universe expansion continued. They eventually formed up the composite particles, commonly known protons, neutrons and electrons (Eastman and Missler 112). The composite particles, soon after, started reacting with each other, forming the hydrogen isotope. These are the basis of life, as we know it today. However, many misconceptions relate to this theory. While there is an argument that a massive explosion took place that sent off different particles of matter that are the beginning of life, there is also a counter argument that no actual explosions took place. The proponents of this view (Hawking & Ellis) argue that a series of endless expansion took place. According to them, the expansion created more space and altered the temperatures that initially existed in the universe. This change of temperatures allowed the cooling down of particles, thus creating a desirable condition for the elements of life to thrive. Another counter argument is that (Eastman and Missler 116), at the very beginning, space did not exist. It has developed over time, as does the rest of matter. With such a view, then we cannot know where the energy, matter and the plasma soup existed. The causes of this theory are highlighted by certain underlying opinions (Andreeva 24). First, there is a thought that the universe must have had a beginning (Eastman and Missler 118). Whichever it was, it is not satisfactorily put across. This only serves to seek an explanation for this beginning. Another reason for the establishment of this theory is the fact that the galaxies seems to keep moving away, a clear suggestion that the expansion of the universe does happen. That the elements of life, hydrogen and helium, are found in the universe further needs an explanation (Hawking and Ellis 230), that the big bang theory has sought to provide. The theory also stems from the ideology that some heat residuals should have remained in the universe. This is supported by the discovery of the cosmic microwave that occurred in 1965 (Eastman and Miss

Psychology and Conducive Learning Environment Essay Example for Free

Psychology and Conducive Learning Environment Essay Discipline is one of the basic requirements of a civilized life. Every society has to set certain norms for people to follow. Everything in this world is governed by a definite set of laws. If everything goes on in a definite routine and the discipline is maintained then there would not be any chaos anywhere. Discipline is the backbone of the national unity. Citizens of disciplined nations can work more smoothly and are filled with the spirit of unity, brotherhood and co-operation. However, discipline does not mean strictly, the withdrawal of personal liberty and authority: on the other hand it provides one with the guideline to use its freedom in a right manner. But that too is possible only if they do not take law in their own hands. Anywhere we go discipline is necessary in any institution whether it is an educational institution, or even in the political field, in social or religious matters, even on street and even while you are sitting in your own house. But unfortunately we note that discipline in our schools and colleges has perished. Students do not show respect to their teachers, misbehave in the classroom, organize strikes and try to take law in their hands. So an atmosphere of indiscipline is created which is a great setback not only to the individual, but to the nation also. Moreover, the teachers themselves do not show any discipline. They are also busy in strikes as to show their discontent against their pay scales, their posts and that affects their quality of teaching. Similarly discipline is an important component of political and social life. Until and unless everybody follows the rules and regulations proper satisfaction cannot be achieved. Anywhere you will find people out of their offices. Govt. employees busy in chatting, ladies busy in knitting at the hours of their duty. All workers show indifference to their duties and hence the work and unattended files keep on accumulating. So if each person imposes on himself or herself discipline and performs his or her duty with devotion, there will be no problem. Even in public places, people create chaos due to indiscipline behavior. People often show lack of law and order, while boarding buses etc. Black-marketing and hoarding and adulteration are also some of the examples of indiscipline. Eve-testing is another example of irresponsible behavior on the part of our youth. In the political sphere also, personal ambitions do come on the way and therefore they pose danger to the society. Discipline is important even in domestic life. If children are grown up in an atmosphere of love and brotherhood, they tend to be good citizens. It is the duty of parents to raise their children in an atmosphere conducive for everybody. The children from divorced parents and from broken homes are generally indiscipline. Therefore, parents should bring up their children in a disciplined manner. Discipline In School School discipline is the system of rules, punishments and behavioral strategies appropriate to the regulation of children and the maintenance of order in schools. Its aim is to create a safe and conducive learning environment in the classroom. A disciplined student is in compliance with the school rules and codes of conduct. These rules may, for example, define the expected standards of clothing, timekeeping, social behavior and work ethic. The term discipline is also applied to the punishment that is the consequence of breaking the rules. The aim of discipline is to set reasonable limits which protect students from harm and teach them what is safe and what is not. Discipline At Home Children are learning how to behave and need parents and caregivers to help them during that process. Because they are always learning, they will misbehave. Psychological studies show that behaviors are more effectively shaped by rewarding positive behaviors than by punishing negative ones. Spanking may have the short-term effect of stopping an undesired behavior, but it may have long-term consequences. Spanking by parents or others may cause harm by teaching children to use violence and by showing them that those who should love and protect them have the right to physically hurt them. The best way for parents to prevent challenging behaviors is to support positive behaviors. How can they do this? Use any opportunity as a teachable moment to talk about simple rules about behavior Put those rules into action. Follow through with praise for following instructions or consequences for disobeying. Discipline is the training of the mind and character; the exercise, development and control of the character, intended to produce obedience and orderly behavior. The definition above is apt enough for the type of discipline intended for the young people at school. The need for disciplining young people cannot be over-emphasized. A wise saying goes â€Å"Spare the rod and spoilt the child†. An undisciplined child becomes a spoil child. The disciplining does not necessarily involve the use of cane. It should normally take the form of corrections by the educators through the setting of good examples and verbal corrections. It is the repeated and deliberate tendencies to incorrigibility that should involve punishments from the educator. These punishments should also be corrective and directly related to the offence. The question then arises; who is to discipline the child, the school or the home? The unequivocal answer is both the school and the home. The efforts of these two agencies to direct the life of the child should be complementary. The all-round development of a person cannot be achieved if one of the parties withdraws its own contribution. Before a child is of school age the discipline is solely the business of the home. At that stage, a child is already in the preparatory stage of being potentially bad or good child. The mind of the new born child being so flexible has had certain impressions made on it. The child learns to act and behave mainly through imitation. These picked-up acts and behaviour which a child goes to the school will form the foundation upon which the school is to be built. Hence the school either inherits a light or a heavy job in this regard. Some schools are lucky to have under their care children who are already good natured and the school only needs to build and improve upon this good foundation. On the other hand the school may inherit other types of children who are real problems. For them â€Å"Please use a soft voice†, instead of â€Å"Stop yelling! † Discipline is a must at home and in school. So in todays society, it is very essential to live with co-operation, and brotherhood amongst each-other. Absence of discipline may lead to failure and backwardness of nation. But one can overcome these problems if everyone follows a personal code of conduct and maintain self-discipline for prosperity of the nation.

Impact of Commercial Paper in the Indian Money Market

Impact of Commercial Paper in the Indian Money Market In todays competitive environment, firms find themselves in a perpetual race to acquire the cheapest source of finance to leverage their companies and gain a competitive advantage. All this is undertaken by companies to satisfy their masters – the shareholders. Finance is a very scarce commodity. A company can satisfy its funding needs generally through two sources namely, equity and debt. It is common practice to use a mix of both in the capital structure. Further the company may rely on two sources of finance – long term sources and short term sources. Long term sources of finance typically include – Shares, debentures, venture capital, public deposits, government grants, mortgage, retained profits, loans from financial institutions, loans from commercial banks etc. Whereas, short term sources of finance include – Overdraft, trade credit, factoring, cash credit, loans advances, discounting of bills, commercial paper etc. A very interesting segment of finance to note is that of money markets. It is an important component of financial markets and is a short term market with maturity period of 1 year or less. The most common instruments traded in the money markets include –treasury bills, certificates of deposits, repurchase agreements, commercial paper (CP) etc. Commercial paper is a short-term debt instrument of the money market. It is an unsecured promissory note with a fixed maturity of 7 to 365 days. It is issued at a discount and redeemed at par. The origin of commercial paper can be traced back to the late 19th century when it grew rapidly as a source of corporate financing until 1920s when it all but disappeared during the Depression. Momentum picked up after the Second World War and a notable incident in the commercial paper market was the Penn Central  [1]  failure which shook the market and temporarily halted its growth (Calomiris, Himmelberg, Wachtel, 1994). Commercial paper as a source of short term funds to Indian corporate sector was introduced from 1990 by the then government in the process of continuing reforms. The direct objective of commercial paper was to improve the short-term liquidity. That is by releasing the pressure on bank funds for medium sized borrowers and enabling companies with high credit ratings to rais e funds directly from the markets (Reddy, 1999). Commercial paper can be further categorized into financial and nonfinancial commercial paper. Nonfinancial commercial paper is issued by nonfinancial corporations, typically large industrial or service firms and utility companies. Financial paper on the other hand is issued by financial companies such as banks (Shen, 2003). From the investors point of view, commercial paper carries with it a great many advantages like low risk due to issuance by prime rated companies, limited reinvestment risk because the commercial papers are generally issued for a short time horizon thereby protecting the investor from large interest rate fluctuations. Investors are also keen on the fact that commercial paper gives higher yields when compared to other short-term investments such as treasury bills or certificate of deposits (Standard Poors, 2008). On the flip side commercial paper is not absolutely risk free, there are certain risks attached to commercial paper – credit risk in that the company may be unable to pay the investors on maturity though this is an extremely rare event, interest rate risk which arises due to the changes in the market interest rates. This risk is mitigated because most commercial papers are issued for short term and most of the investors hold onto the paper until maturity thereby they are unaffected by price movements. Rollover risk is also present because most papers are retired by the companies by making a fresh issue. This risk is also minimized by securing a bank line of credit. The major risk facing commercial paper is liquidity risk which affects the market as a whole. The whole market turns hostile, interest rates rise and the issuer becomes unable to rollover or make fresh issues (Standard Poors, 2008). To guide the investors in making rational and informed decisions, it is mandatory for the commercial paper issue to gain a credit rating from recognized agencies. Ratings give an idea as to the risk attached to the commercial paper and the overall picture of the firm. A substandard rating implies that the firm is extremely risky and there is probability that the firm may default on its payment. In U.S., the recognized credit rating agencies include Standard Poors, Moodys, Fitch, A.M. Best etc. In the commercial paper rating mechanism practiced by Standard Poors, a rating of ‘A1+ is the highest possible score meaning that the firm is creditworthy and there is no risk of default whereas a rating of ‘A3 and below notifies that the instrument is speculative or junk. In India, Credit Rating Information Services of India Ltd. (CRISIL) and Investment Information and Credit Rating Agency of India Ltd. (ICRA) are the reputed rating agencies. The other notable agencies operating in India are FITCH ratings and Credit Analysis and Research Ltd. (CARE). According to the RBI, for a commercial paper to be issued in India the company must have a minimum credit rating of P-2 as per the CRISIL rating scale or its equivalent. Rating is extremely important as the regulations laid down specify that money market funds can invest only in commercial papers having the minimum rating of P-2. Commercial paper scores over bank line of credit or short term loans in many aspects. A company that has high credit ratings enjoys many privileges – they can access lower cost commercial paper, flexible maturity periods to match their cash flow stream. Commercial paper in essence is an unsecured promissory note. Thereby, there is no lien created on its assets. Moreover, there is no limitation on the end-use of funds generated through commercial paper issue. They are traditionally favored as they are cheaper when compared to bank loan, as low as 3.5 % for three months 5.6 to 5.75 % per year. Banks cannot match this rate since their cost of funds itself works out to almost 6% (Pathak, 2009). Money market funds are the largest holders of commercial paper (Standard Poors, 2008). The other investors in commercial paper include trust funds, retirement and pension funds, insurance companies and other large firms having extra funds to invest in them. Individual investors find it difficult to deal in this market because commercial papers are usually sold in very large denominations. To overcome this, they invest in it through money market mutual funds. In India commercial banks were the subscribers of almost 80% of all commercial paper issues but that trend has been declining and as in the U.S., mutual funds are becoming the prominent investors. The recent financial crisis affected almost all the major economies around the globe. The U.S. was the epicenter of this financial earthquake. The recession had far reaching effects many companies folded, investment houses lost their prominence and were absorbed by larger entities and banks were bailed out by the government to avert an economic disaster. The commercial paper market first felt the effects of the crisis on August 2007 when the market contracted sharply as a reaction to the subprime crisis (Shrivastava, 2008). The crisis deepened during September 2008 beginning with the default of Lehman brothers. A large money market fund, the Reserve Primary Fund announced that it had suffered losses to the tune of $785 million as a result of holding Lehman Brothers commercial paper. This spread shockwaves through the entire market and investors were in a hurry to redeem their holdings. In a space of one month the total value of commercial paper outstanding reduced by 15% from $1.76 trillion to $1.43 trillion (Kacperczyk Schnabl, 2009). The Indian economy is intimately tied to the global economy; as such any fluctuations in the global market will have repercussions in the Indian financial market also. Global financial crisis manifested itself in India on January 2008 resulting in the crash of the Indian stock market caused due to the fleeing of FIIs (foreign institutional investors). The Indian commercial sector found itself in a race to acquire funds due to the drying up of several avenues of fund notably, external commercial borrowing. To counter this, bank finance in the form of investments in shares, bonds, debentures, commercial paper etc. expanded more than the previous year (Joseph, 2009). So on a contrast with the commercial paper market of America, the commercial paper market in India was on a rise during 2007. In the U.S., the Federal Reserve undertook unprecedented steps to stabilize the commercial paper market. Federal Reserve of New York introduced the Commercial Paper Funding Facility (CPFF) whereby the Federal Reserve would buy the paper directly from eligible issuers (Federal Reserve, 2008). In early January 2009 the Federal Reserve was the single largest purchaser of commercial paper and accounted to having almost 22% of the market. The facility purchases the commercial paper and holds onto it till maturity and the returns received upon maturity are utilized to pay off Federal Reserve of New York which had provided the capital to initiate the facility. At its peak the Federal Reserve held almost $357 billion worth of commercial paper, that holding was gradually reduced over the years and at the time of the withdrawal of the facility during February 2010, the amount had dwindled down to $3.94 billion (Zumbrun, 2010). In India, the commercial paper market is extremely healthy and as p er the latest outstanding figures it is 1,03,915 crores. 1.1 Aim of the project To understand the role of commercial paper in the Indian money market along with the changes in risk return and also the total outstanding during the period of financial crisis. 1.2 Need of the study India is the second fastest growing economy in the world. The policy makers aspire to attain double digit growth rate. During our review of literature we came to understand that no significant study had been undertaken to understand the effect of the financial crisis on the returns of commercial paper in India. Moreover, studies concerning commercial paper on a global level are also limited. We attempt to fill this knowledge gap. There is wide literature in the form of articles regarding the effects of the financial crisis on the American commercial paper market. We are attempting to understand if the effects of recession on the American commercial paper market have also affected its Indian counterpart. 1.3 Objectives of the study The following are some the objectives that we hope to accomplish during the course of our study. a. To understand the role of commercial paper as an instrument in Indian Money Market. b. To understand risk return movement of commercial paper in India during the financial crisis. c. Comparative analysis of risk return between American Indian commercial paper. d. Understand the changes in commercial paper outstanding of both American and Indian commercial paper market during the financial crisis. 1.4 Hypothesis There is a positive correlation between Indian U.S. discount rates. Indian U.S. commercial paper outstanding have decreased during the period of financial crisis. 1.5 Methodology The study is quantitative in nature. We will be relying exclusively on secondary sources of data, significantly the reports generated by the Reserve Bank of India. Statistical tools such as measures of central tendency, measures of variation and correlation will be used. 1.6 Limitations of the project The major problem being faced is scarce information regarding the Indian commercial paper market. Time constraint will limit the extent depth of the study. The data regarding commercial paper rates for both India and U.S. has been published only up to November 2009 at the time of study. 1.7 Chapter Plan The following is a brief summary of the chapters within the project. Chapter 1: Introduction – Provides a brief insight into the history, role and functioning of commercial paper as a money market instrument. This is followed by the aim, the need, objectives and a brief overview of the methodology followed by the limitations of the study. Chapter 2: Literature review – A broad review of literature which was deemed relevant to the study. The literature mainly comprise of empirical studies undertaken by various researchers. Chapter 3: Methodology and the methods – The data source, statistical tools are highlighted in this chapter. Chapter 4: Analysis and Interpretation of the data collected. Using the techniques mentioned in the methodology, a thorough analysis of the data is conducted. A brief interpretation is also provided. Chapter 5: Conclusion – Concludes the study with a summary of our findings. Chapter 2: Literature Review 2.1 According to Saurabh Ghosh and Narayan Chandra Pradhan (2009) The authors have tried to understand the determinants of WADR (weighted average discount rate) and how these determinants have affected their movement over the past 5 years after adjusting for seasonal fluctuation. The real and financial variables considered for the study were: Index of industrial production (IIP), Amount of CP issued, Cut-off yield 364 days, Call/Notice money, Sensex, Indian Rupees – U.S. Dollar exchange rate bank credit. A close movement and dependency was found out between WADR and the call rate the 364 day treasury bill yield. Although initially there wasnt much co-movement between WADR and the BSE Sensex, co-movements were noticeable after December 2005.The empirical results indicate that there has been an increase in the average monthly issuance, WADR and volatility of WADR over the years. However, around 80% of the commercial paper issued by companies over the last five years was from ‘Prime-rated companies. 2.2 According to Matthias Kahl, Anil Shivdasani Yihui Wang (2008) Firms access commercial paper market to enhance their financial flexibility. Firms use it to fund investment when attractive projects arise and they have insufficient internal funds. Another way in which commercial paper may be used to increase a firms financial flexibility is as bridge financing. They argue that commercial paper borrowing in positively correlated with investment expenditures and negatively correlated with cash holdings. 2.3 According to Pengjie Gao and Hayong Yun ± (2009) The collapse of Lehman brothers was followed by a virtual closing of the commercial papers market, followed by which a number of firms drew excessively on their remaining lines of credit out of fear that weakened banks would reduce their loan commitments. Aggregate commercial paper borrowing declined 15% after the collapse of Lehman brothers, but the effect was concentrated among firms with high default risk. High risk borrowers that were negatively impacted by the decline in the commercial paper market after Lehmans default substituted commercial paper with lines of credit. Low risk borrowers remained as they were. 2.4 According to Charles W. Calomiris, Charles P. Himmelberg Paul Wachtel (1994) The authors arrived at three conclusions. Firstly, there is a flight to quality during a downturn. Firms with strong balance sheets exploit this demand to reduce their cost of short-term borrowing. Secondly, firms in strong financial condition issue commercial paper during downturns in order to extend credit to other firms which may include customers of the firm. As the economy weakens, customers pay their bills more slowly and firms may extend more trade credit as a means of financing their customers short-term credit needs. There is evidence that commercial paper is used to finance trade credit. Finally, increased commercial paper issuance is used to finance inventories. Further, they established links between growth of commercial paper in relationship between the paper market and the commercial bank portfolios. At various times the growth of the commercial paper market was attributed to – (i.) Banks with weak loan demand that were searching for an alternative asset. (ii.) Regulatory constraints that made bank deposits unattractive. (iii.) Market conditions that made bank loans relatively expensive. 2.5 According to John P. Judd (1979) The researcher argues that commercial paper market has replaced the banking sector as the primary source of short-term funds for large financially sound nonfinancial firms. Banks can compete effectively only if the value of the intermediate services that they provide to the lenders/borrowers is greater than the spread between the lending and borrowing rates that they must charge to cover the costs of doing business and absorbing risk. However, it was found that the value from the intermediate services were relatively small and hence the switch over to commercial paper. 2.6 According to Pu Shen (2003) Before the current drop in commercial paper outstanding there was a past occurrence in 2002 when the market for nonfinancial paper declined rapidly. The author tries to understand the factors that led to the unusual decline. To achieve this he considered the factors that could have reduced the supply of credit as well as factors that could have reduced the demand in the commercial paper market. On the basis of this analysis, a conclusion was reached that both demand and supply contributed to the decline. Supply in this context means willingness of the investors to participate in the market. Willingness can be reduced by two factors – Actual or perceived deterioration of the creditworthiness of borrowers and general reduction in investors tolerance for risk. On the demand side, two factors reduce the need for corporations to borrow in the commercial paper market. One factor is decline in inventories which reduces companies short-term financing needs. The other factor is a switc h by firms from borrowing short-term in the commercial paper market to borrowing longer in the bond market. 2.7 According to Dan Covitz Chris Downing (2002) A model is created to explain the relationship between short term and long term yield spreads. Short term spreads cannot be explained by insolvency model because of large spread. Many a times short and long term spreads are negatively correlated. Their explanation for observed risk spreads rests on a distinction between the fixed and liquid assets of a firm. A simple model was proposed in which a firm with a low level of liquid assets may be forced to turn to outside sources of funds to meet its short-term obligations. Funds raised from outside can bring in delay in payments to creditors, which can affect the short term creditors more than long term creditors. Variety of insolvency-risk and liquidity-risk proxies were used and was found that liquidity risk help explain short-term spreads during periods of market stress, but explains very little about long-term spreads. Their empirical findings indicated that while liquidity is an important determinant, the credit risk is the dominant determinant of Commercial Paper credit spread. A literature survey regarding Asset Backed Commercial Paper (ABCP) was conducted, but was disregarded as it was not relevant to the research at hand. A working group has recommended that ABCPs be introduced to deepen the commercial paper in India. Following this the RBI issued the draft guidelines on securitization of standard assets on April 4, 2005. Chapter 3: Methodology Research basically means a quest for knowledge. The primary purpose for applied research is discovering, interpreting and the development of methods and systems for the advancement of knowledge on a wide variety of scientific matters (Wikipedia.com).In this chapter the methodology and methods to be used for analyzing the commercial paper market are briefly discussed along with the problems encountered and the steps that were taken to overcome them. 3.1 Types of Data There are broadly two types of data that are available at the disposal of a researcher. 3.1.1. Primary Data We may rely on primary data if the research calls for raw data that has been collected at the source and has not been subject to any manipulation. Primary data can be qualitative or quantitative. The core benefit of this type of data is that the researcher can exercise a high degree of control over the method and tailor the data collection methods to suit the needs of his research. 3.1.2. Secondary Data Primary data collected by one person may become the secondary data of another. Secondary data has many benefits that make it very appealing. The most obvious advantage is that the data is very economical since the cost of collecting it is usually very little when compared to primary data. It also saves the time of the researcher which would otherwise have been spent on the data collection process. Another key advantage is that in the process of searching for data relevant to the problem, the understanding of the researcher of the problem is improved and there can be changes in the idea in light of the secondary data collected (Beri, 2003). That is not to say that there are no limitations to it. The major risk undertaken by the researcher when collecting secondary data is that the accuracy of the data is compromised. Subsequent problems may be the availability, relevance and sufficiency. Our research relies on secondary data specifically the commercial paper rates published by the Reserve Bank of India and The Federal Reserve. Since these institutions are the apex central banks of India and United States of America respectively, we assume that the data provided by them is highly accurate and can be safely used in our study. Internet Research. As the name implies, it is the practice of using the World Wide Web for research purposes. After identification of our topic, we had to undertake an internet research to gain more background information about it and further our understanding of the topic. Several newspaper articles published on the internet was used to draw a rough chronology of the events in both the Indian U.S. commercial paper markets during the period of study. 3.2. Time Period The financial crisis was well underway during the early half of 2007 due to subprime mortgages default. We have divided the time period of our study into two distinct frames to analyze and draw logical conclusions. 3.2.1 First Time Period (November 2007-October 2008) We have selected November 2007 as the initiation point of the first time period our study due to the fact that the stock markets in America was in turmoil and falling rapidly. Leading up to this point there were certain major market developments, the LIBOR (London Interbank Borrowing Rate) reaches its highest level since 1998. Northern Rock collapses and receives emergency support from Bank of England. Major Banks such as UBS and Citigroup announce losses numbering in the billions due to subprime mortgage defaults. September 2008 was a very dynamic and crucial month in the context of the financial crisis. U.S. government bails out mortgage lenders Freddie Mac Fannie Mae, which hold almost half of all outstanding mortgages in the U.S. Bank of America proposes to take over Merrill Lynch for USD 50 billion. Lehman brothers files for bankruptcy making it the biggest corporate bankruptcy ($ 639 billion) in the history of U.S.A. Morgan Stanley Goldman Sachs loses their status as investment banks. They become traditional commercial banks (Mauro F. Guillà ©n, 2009). The first time period concludes on October 2008. The reason we have selected this particular month is that in the aftermath of Lehman Brothers bankruptcy, the commercial paper market contracted severely. Investors lost their confidence and companies were finding it difficult to make fresh issues of commercial paper. 3.2.2 Second Time Period (November 2008-November 2009) For companies that use commercial paper as a short-term funding mechanism, a sudden stoppage of access to the market will push them to the brink of bankruptcy. The Federal Reserve recognized this and initiated the Commercial Paper Funding Facility towards the end of October 2008. The major objective was to stabilize the commercial paper market and provide the necessary funding to the companies. Our second time period picks off from this point and continues till present. 3.3 Statistical Techniques Statistics is termed as the science of making effective use of numerical data. It deals with all aspects of it including collection, analysis and interpretation of such data collected. To facilitate our analysis, we had to rely on certain statistical tools and the software SPSS. 3.3.1 Measures of Central Tendency The most commonly used tool for understanding ‘averages is the arithmetic mean. A single value which is a representation of the entire mass of data taken into calculation. It is neither the highest nor the lowest value in the data set. It takes into account all the values in the study. It is in essence a single value around which the other variables in the study tend to cluster. The arithmetic mean is also laden with a certain disadvantage namely the tendency of the mean to get unduly affected by the presence of extreme values. 3.3.2 Measures of Variation Using mean will only supply us with a single figure representing the entire data. We cannot understand the dispersion of the values from the mean. To overcome this obstacle, we need to use a measure of variation. We have decided to study the variation utilizing the tool ‘standard deviation. Standard deviation helps us to measure the risk associated with commercial paper. Standard deviation will be equal to zero when all the numbers in the sample are very close to one another. The more dispersed they are the greater will be the standard deviation. 3.3.3 Correlation Mean and standard deviation does not allow us to compare two different variables. In such a scenario we may use correlation to understand if any relation exists between two variables. If relation is proved, correlation further helps us to judge to what degree the relation is present and the significance of it. The correlation coefficient ‘r ranges from -1.0 to +1.0. The closer ‘r is to either poles, the higher the correlation. Towards +1 indicates a positive correlation whereas closer to -1 is an indicator of negative correlation. 3.3.4 Simple Bar Diagrams/ One-dimensional Bar diagrams Simple bar diagrams are considered to be the most commonly used diagrammatic representation of data. Only the length of the bar matters, the width of a single bar is present only for drawing attention to the figures and making clear cut conclusions. We have used bar diagrams to depict the trend of commercial paper outstanding in both the Indian U.S. commercial paper markets over the period of study. 3.3.5 Times Series Graphs We have utilized time series graphs to chart the movement of risk across the time period of study. The reason for the selection of this technique is due to its usefulness in giving a quick idea about the trend of the variable over a period of time. The other added advantage is that it allows a comparison of two variables also across the time period. Chapter 4: Findings Analysis 4.1 Introduction In this chapter, we attempt to make a systematic analysis of the secondary data that we have collected from Reserve Bank of India Federal Reserve System. The raw data was transferred to Microsoft Excel software after proper scrutiny. The data was analyzed by using the statistical tools present in the Microsoft Excel SPSS programmes. As we have described earlier in the methodology, descriptive statistics like standard deviation, arithmetic mean and inferential statistics like correlation were used to analyze the data. Data presentation tools like Simple bar diagram and Time series graphs were utilized to present the data logically and in an understandable manner. The discount rates provided by RBI consisted of low high rates. The average of the discount rates was calculated to make a meaningful analysis and enable comparison with the U.S. commercial paper discount rates, since the Federal Reserve provides only a single rate. Moreover in the U.S. the commercial paper market is sub-divided into two broad strata, i.e. financial and non-financial commercial paper. Both of these were taken into account to enable the study to be more comprehensive and significant. The U.S. commercial paper outstanding amounts were converted into Indian rupees on the basis of foreign exchange rate prevalent in the time period of study. This was conducted on a month wise basis from November 2007 till November 2009. 4.2. Analysis of Data The following section contains an analysis of the data. 4.2.1 The first analysis conducted was to trace the movement of discount rate in India during the first time period. Table.1. Mean Standard Deviation of Indian Discount Rate during November 2007- October 2008 Mean 10.9242 Std. Deviation 1.70208 Interpretation 68% of the time, the average discount rate shall vary between 9.6 and 12.6. That means for nearly 8 months of the study period, the rate of return of commercial paper in India will be between 9.6 12.6 95% of the time, the discount rate shall vary between 7.5 and 14.3. The overall trend from the observed figures indicates forward direction. The cause behind this trend maybe the accelerated inflation rate. The investing communitys confidence levels are weakened, as a result the expected levels of discount rate also increases. Another reason may be that the investors are worried about the exposure of Indian banks to U.S. subprimes. For instance ICICI exposure to Citibank Asset backed securities is one important reason behind uncertainty in Indian money market segment. Graph.1. Movement of discount rate during Period 1 Interpretation Until December 2007, the discount rates did not undergo much fluctuation. From January 2008 till April 2008, the rates were subject to wide changes the average rate reached heights like 11.88 and depths of 8.73. In March, the market on expectations of a promising RBI credit policy announcement has shown an upward surge. But the RBI maintained the status quo, the bank rate, the repo rate and the reverse repo rate were unchanged. Following this the returns show a decline and thereafter it has shown a rising trend till October 2008. Corresponding to this period, the inflation rates in India had also been growing at an accelerated pace. The inflation in India during March was 5.11%, this shot up to 12.63% in August and declined to just 10.72% by October end. If the inflation rate increases, the nominal interest rates also increases, as a result commercial paper discount rate is also showing an increase. The discount rate rose to an all time high of 14.23 in October 2008.This abnormal rise in discount rates may be linked to Lehman Brothers declaring bankruptcy in U.S.A. on September 15, 2008. Because of the bankruptcy, the investors have lost their confidence on money market instruments. This event might have triggered investors in the Indian commercial paper market to seek higher discount rates on the Indian commercial paper. As a result pushing up the discount rates on commercial paper issued by the Indian corporate sector. 4.2.2 This analysis deals with the movement of discount rate in

Global Warming is Here. Now What? Essay -- Climate Change, Synthesis E

Global warming denial and unprogressive energy outlooks are all products of not seeing the full picture. The evidence is clear, even in nature. Plants are blooming earlier, animals are waking up from hibernation earlier, birds are migrating farther north, and populations of animals have already gone extinct due to global warming. Yet, some still stay stern in denying its reality. That being said, even honest open-minded people can fall prey to misleading notions and statistics. To truly uncover the truth, we need to see the full picture. While researching climate change, with the mountains of false or cherry-picked data out there, you certainly learn to be skeptical of a source's creditability. You also, learn the importance of getting the full picture, rather than just a partial one. Heres a few examples, of what I'm talking about. A while back many were convinced that because CO2 follows global surface temperature increase by about 800-1000 years, that CO2 as a cause of global warming was disproved. Which made sense; how can a cause follow a result? It seemed to go against the basic order of cause and effect. Al Gore even strengthened the argument, by mistakenly telling the audience in his video An Inconvenient Truth, that CO2 lead temperature. So when that statement turned out to be false, many people came to the conclusion that climatologists were wrong about CO2, and if they were wrong about a major cause than maybe they were wrong about global warming all together. However, unknown to most of those people at the time, climatologists were already very aware of CO2's lag behind temperature. The complexity of the process was already known. It isn't a straight forward cause and effect ordeal. The initiator is... ...ance of the greenhouse effect. Information I will use to explain the greenhouse effect. "FORD PLANNING NEW ELECTRIC, HYBRID AND PLUG-IN VEHICLES IN NEXT 4 YEARS." Ford Motor Company. N.p., n.d. Web. 13 May 2010. Information on the Ford Focus electric car. I could use the Ford Focus electric car as an example. Paddock, Barry. "Nissan Leaf vs. the Chevrolet Volt: Electric car war heats up New York International Auto Show." NY Daily News. N.p., 1 Apr. 2010. Web. 13 May 2010. Information on both the Nissan Leaf and Chevy Volt electric cars. Both cars can be used as example, and to show the difference in models. Edwards, Ross. "Electric Car Battery Swapping Station Launched in Japan." PriceWheels.com. N.p., 30 Apr. 2010. Web. 13 May 2010. Contains information on the Electric car replacement stations. Vital in explaining why electric cars are the future.

Letter from Birmingham Jail by Martin Luther King, Jr. Essay -- Essays

Letter from Birmingham Jail by Martin Luther King, Jr. â€Å"Hence, segregation is not only politically, economically, and sociologically unsound, it is morally wrong and sinful.†Ã¢â‚¬ ¦ Martin Luther King, Jr., one of the greatest speakers in all of history wrote these words in his letter from Birmingham Jail (King 48). His great use of rhetoric affected largely the freeing of an entire race. During his work in the Civil Rights Movement, he visited a small town called Birmingham in Alabama, and wrote one of his most rhetorically compelling letters there. In this letter, he used historical evidence, scriptural references, descriptive vocabulary, and great organization of points to respond to grievances raised against his movement: that he should wait, that he was breaking laws, that his peace brought on violence, and that his activities were extreme. Time will heal all wounds†¦right? This is what was thought by desegregationists. Martin Luther King, Jr. was told that he should just wait, and in time, African Americans would receive their rights. King wrote this in response: â€Å"Human progress never rolls in on wheels of inevitability; it comes through the tireless efforts of men willing to be co-workers with God, and without this hard work, time itself becomes an ally of the forces of social stagnation.†(King 51) King knew that if he didn’t fight, this wound wouldn’t be healed. He used historical evidence in order to prove his point. He said, â€Å"Just as Socrates felt that it was necessary to create a tension in the mind so that individuals could rise from the bondage of myths and half-truths to the unfettered realm of creative analysis and objective appraisal, so must we see the need for nonviolent gadflies to create the kind of te... ...see tears welling up in her eyes when she is told that Funtown is closed to colored children, and see ominous clouds of inferiority beginning to form in her little mental sky;† He uses historical and biblical evidence to support his arguments. He organizes his arguments perfectly in order to persuade in the most effective way possible. King knew rhetoric. At the end of his letter, he finished up by showing his true reason for fighting his fight. He said, â€Å"If I have said anything in this letter that overstates the truth and indicates an unreasonable impatience, I beg you to forgive me. If I have said anything that understates the truth and indicates my having a patience that allows me to settle for anything less that brotherhood, I beg God to forgive me.† Works Cited King, Martin Luther Jr. Letter from Birmingham Jail. Massachusetts: Heinle &Heinle, 2003.