...acid which makes up the genes for all living things) is extracted from one organism to put it in another organism’s DNA, therefore it introduces in hereditary traits into the receiver organism (“How Stuff Works”). The nature and characteristics of all living things are determined by special combinations of genes that are carried in their cells, therefore the least changes or alteration can bring a major amount of changes in an organism and its offspring (“How Stuff Works”). Genetic Engineering does not only consist in plants, animal breeding and fertilization of crops it also includes polyploidy (organism which two sets of homologous chromosomes), mutagenesis (process in which the organisms genetic material is changed in sable manner that causes mutation), and cell fusion techniques which does not involve recombinant nucleic acid or genetically modified organism in the process (Wikipedia). Cloning and stem cells also do take a part in Genetic Engineering (Wikipedia). Advances in Genetic Engineering are also playing an important role for agricultural and economic welfare. GMO (Genetically Modified Organisms), the prospect of Genetic engineering amongst agricultural brought some benefits like increasing crop yields, reduction cost for food and drug manufacturing, moderates the needs for pesticides, improved the configuration of nutrients and food quality, great amount of food safety and provides medical benefits the world’s increasing population (“Nature”). Advances have also...
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...“What were the cause of the financial crisis of 2008 and 2009” The 2008 financial crisis led to a sharp increase in mortgage foreclosures primarily subprime leading to a collapse in several mortgage lenders. Recurrent foreclosures and the harms of subprime mortgages were caused by loose lending practices, housing bubble, low interest rates and extreme risk taking. Additionally, expert analysis on the 2008 financial crisis asserts that the cause was also due to erroneous monetary policy moves and poor housing policies. The federal government encouraged the expansion of risky mortgages to under-qualified borrowers. Congress pushed for the support of affordable housing through extended procurement of non-prime loans for applicants with low income (Zandi, 2008). The cutting down of interest rates to low levels to supplement for technology bubble of early twentieth century and the effects of Sept 11, a housing bubble was created. This move facilitated individuals with poor credit to obtain mortgages in high percentage when lenders created non-conventional mortgages by offering mortgages with extensive amortization periods, loans with interest and payment alternatives such as ARMs. Ultimately, interest rates rose again and many subprime borrowers stopped paying for their mortgages when their interest rate were reset to higher monthly payments. Subprime mortgage is simply defined as loan offered to someone with a weak credit history. Since the 2008 financial crisis had its source...
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...The sub-prime crisis of has led to a financial crisis in 2008-2009 that impacted many countries around the world. Discuss the cause of the sub-prime crisis and the major parties responsible. A number of parties were responsible for the sub-prime crisis during the period of 2008 to 2009. This essay will be discussing the parties responsible for the sub-prime crisis and how the individual party’s action causes the others to step deeper into the problem. As define by investopedia, sub-prime is “a classification of borrowers with a tarnished or limited credit history. Lenders will use a credit scoring system to determine which loans a borrower may qualify for. Subprime loans carry more credit risk, and as such, will carry higher interest rates as well.” The US subprime mortgage crisis was the catalysis of the finical crisis and subsequently cause the recession that began in 2008. The cause of sub-prime crisis arise from sub-prime loans or also know as sub-prime mortgage, the growth of this loan started expanding during the 1990s and such load is popularly seen in auto (car) loans, home equity (housing loans) and mortgage lending. Sub-prime loans are higher-risk loans labeled “B”, “C” and D credits, where “D” being the “worst”, resulting in a higher interest rate, which also mean a higher risk to the lenders. But it seem not to be a hindering problem, from the point of view of the finical institute who lend out the money, which will be explained later in this essay. In...
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...Introduction: This paper reviews macroeconomic causes of financial crisis in 2008. The economist had difficulty for seeing the systematic risk because of the unregulated new financial instruments such as credit default swap and derivatives securities. The Federal Reserve Bank was responsible for the financial crisis due to large amount of money flow in the United States. Thus, US needed to implement the monetary policy in order to overcome from the financial crisis. This paper drafted the causes of financial crisis analyzed by the macroeconomist and drafted by the American Bar Association. The Federal Reserve Bank kept the interest rates historic lows due to recession in 2000-2002. The low interest rates causes the unwanted money supply and this excess credit was invested heavily in the United States in the form of treasury securities and financial derivatives that leaded to bubble in commodities and houses prices. This paper examines the Federal Reserve monetary and fiscal policy during and prior to course of recession in 2008. The economy had faced at least three crises since 2008, fiscal crisis, financial crisis and unemployment crisis. These crises are interrelated. The unemployment crisis during 2008 has causes the fiscal deficit at the frightening level. The economy is still facing the unemployment and fiscal crises. The unemployment rate remains high in the world and the fiscal problem in Europe has not been fully resolved. The Fiscal Policy: The fiscal policy played...
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...2008 FINANCIAL CRISIS Name Course Date 1. Background The financial crisis commenced in August 2007 after the preceding inflation. The crisis became more defined throughout 2007 and gained momentum in 2008. This took place even after the financial regulators and the central banks’ tireless attempts to tame the situation. It is alleged that the main factors that influenced its manifestation include corruption, fraud, speculation, greed, bankers and bankers’ bonuses. However, the academic discourse, politics or media has been unable to solve the mystery surrounding the main causes of the crisis[1]. The mystery is academically relevant to the world of research just like the Great Depression, whose causes are still being discussed. Other sources believe that the crisis might have been as a cause of human failures especially following the refusal to bail out the Investment Bank Lehman Brothers. The housing bubble was the immediate trigger of the 2008 financial crisis. The following were the triggers under the housing bubble. I. Subprime lending A subprime mortgage is the mortgage that is readily acceptable without imposing strict measures of standard on it. Before the 2008 financial crisis, there existed a fierce competition between mortgage lenders. The competition between the mortgage lenders ensued from the struggle for market share and revenue. It also took place in tandem with limited supply of creditworthy borrowers which put unconditional stress...
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...2008 FINANCIAL CRISIS Name Course Date 1. Background The financial crisis commenced in August 2007 after the preceding inflation. The crisis became more defined throughout 2007 and gained momentum in 2008. This took place even after the financial regulators and the central banks’ tireless attempts to tame the situation. It is alleged that the main factors that influenced its manifestation include corruption, fraud, speculation, greed, bankers and bankers’ bonuses. However, the academic discourse, politics or media has been unable to solve the mystery surrounding the main causes of the crisis[1]. The mystery is academically relevant to the world of research just like the Great Depression, whose causes are still being discussed. Other sources believe that the crisis might have been as a cause of human failures especially following the refusal to bail out the Investment Bank Lehman Brothers. The housing bubble was the immediate trigger of the 2008 financial crisis. The following were the triggers under the housing bubble. I. Subprime lending A subprime mortgage is the mortgage that is readily acceptable without imposing strict measures of standard on it. Before the 2008 financial crisis, there existed a fierce competition between mortgage lenders. The competition between the mortgage lenders ensued from the struggle for market share and revenue. It also took place in tandem with limited supply of creditworthy borrowers which put unconditional stress...
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...the Inside Job video, the term Global Economic Crisis of 2008 or Global financial Crisis that I understood is where a period of time, there was a great depression on workers, consumers, producers and the peoples due to major losses that happened globally between investment banks, insurance company, Audit firms, financial services firms and other multinational corporations. What are the causes that these entire gigantic firms led to major losses? This economic crisis had cost ten millions of people lost their savings, their jobs and their homes. The first part of the video was about Iceland country. Iceland is such a beautiful country with fresh air, foods, efficient operations of geothermal and hydroelectric and where the economic was stable in marketing before the crisis happen. Iceland is one of the high standard living countries. In 2008, the population is very high about 320,000 and the GDP of the country was $13billion, the bank had major losses about 100billions. During the year of 2008, Iceland banks collapses due to borrowers unable to settle their debts from lenders. Unemployment triples in 6 months. The three banks in Iceland which are Iceland’s banking, Kaupping and GLINTR had borrowed money which is three times the economics of Iceland. Government had financial deregulation. The government could not able to protect the citizen during this crisis. Collapses of major bank in US and Iceland are main causes to this crisis The major Investment banks which are Lehman...
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...Abstract The United States is going through one of the most serious financial crisis’ since the 1930’s. As a result, many people are losing their jobs and some companies are filing for bankruptcy. There are many causes that may have led to this financial crisis. Some include Bush’s investment in the Iraq war, subprime lending awards mortgages to people with poor credit, defaults on loans force banks to raise equity, but most importantly, greed. Not only is there a crisis going on in the United States, but there is a crisis occurring globally also. Bush and his investment in the Iraq war could be a cause to this financial crisis. Prices of everything have gone up and people have to spend more money on items so this causes them to be unable to pay off debts of loans to the banks. When that occurs, banks take a low blow because they miss out on the money. So many people are losing their houses due to lack of income banks. They have to pay the remaining money to the town/government. So after paying the houses of so many people, the banks go bankrupt. If banks go bankrupt, there wouldn’t be anyone to lend money to businesses. There wouldn’t be any jobs if there aren't any businesses. This all leads to no income. The war in Iraq increased oil prices, which increased service prices because everything needs to be delivered in cars or trucks so people have to pay more for goods. But they aren't getting paid more money so they end up losing money. This graph is showing the real...
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...A period of economic difficulty that consumers and markets are experiencing world-widely is known as global financial crisis (BusinessDictionary, 2015). It occurs when there is an increase in asymmetric information coming from disruptions in financial system that is interrupting the funds from channelling efficiently between savers and households as well as preventing firms from having productive investment opportunities (Mishkin and Eakins, 2012, pp. 204). The recent global financial crisis began in the year of 2007 and the intensity increased in the subsequent year. Global financial crisis in 2007 happened as result of a number of factors such as government mandated subprime lending, imprudent mortgage lending, housing bubble, securitization and a few other more factors, which will be discussed. Causes The government mandated subprime lending has contributed to the financial crisis by promoting affordable housing under Community Reinvestment Act (CRA) as well as Fannie Mae and Freddie Mac. Through affordable housing, banks were encouraged to participate in imprudent mortgage lending as mandated by the federal in order to help low-income borrowers, which imprudent mortgage lending is another cause that contributed to the global financial crisis (Jickling, 2009). As a result of mortgage lending, low-income families are able to purchase houses that they are not be able to afford to purchase without the policy. The loans require low or no down payments and limited documentation...
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...economic crisis that struck the world between 2008 to 2009 had such resounding adverse impacts that brought even the mightiest economies to its knees. Even at present, the far-reaching effects of the crisis remain almost palpable and may be seen in high unemployment rates, economies still in recession and seemingly insurmountable national deficits. The United States, where the crisis had its beginnings continues to suffer from the recession even if it is gradually recovering. The present problems in the Euro zone may be partly attributed to the recession of 2008. Because of these, many scholars, economic analysts, researchers and businessmen continue to endeavor up to now to discern what the real cause of the economic crisis was in the hopes that it will not happen again. Many people attribute the global economic meltdown to the collapse of the subprime sector in the United States. To put it simply, the mortgage sector was blamed for the crisis because of how many financial instruments were collateralized by mortgages of people who had bad credit histories. When too many of them failed to meet their obligations, it began a series of defaults that ultimately collapsed not only the mortgage industry but the financial industry as well. All those that have investments in both sectors, local and foreign entities, also became affected as they lost what they have invested. However, a crisis of such scale as that which took place in 2008 to 2009 could not be attributed to one cause alone...
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...Derivative triggered the financial terror Jiho Jang Warren Buffett already said the derivatives “financial weapons of mass destruction.” It’s not surprising. The derivative products have triggered the most destructive financial crisis since the stock market crash in our history. The causes of financial crisis in the late 2000s are still controversial. Some assert that it is just the financial system, and regulation failure and the other insist that resulted from the financial engineering failures. The explosive growth in derivative contracts occurred after 1999 when the Glass-Steagall Act was repealed, which allowed banks to operate as brokerage. Glass-Steagall, adopted in 1933, separated brokerages and banks to ensure banks would no longer be involved in risky transactions. And credit rating agencies were slow to downgrade the credit rating of the securities. Because the rating agencies did not disclose the downgrades in time, many investors were misled to think that securities were still safe to invest in, and it accelerated the market crisis uncontrollably. The initial intention of derivatives was to defend against risk and protect against the losses and downside. However, derivatives were the most important tools to trigger the financial market collapse. Those tools usually used to take on more risk to maximize profits and returns rather than to defend against risk and to protect against the losses. All kinds of financial products are transferred to the...
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...International Threats The impact of the global financial crisis on the world economy A Review of the Literature Foundation Year, BSc (Hons) in Banking and Finance Valikhujaev Voriskhon CA2394385 Group #112 Gerson Lapid, Mirzahidov Mirsodiq November 28, 2009 Abstract Two years have passed since the most severe global financial crisis launched in the USA. During this short period of time a lot has been made by the governments of the countries that suffered from the crisis. Yet, it is still expected that they need to implement more in order to eradicate the negative impacts from the crisis. Only the time will show which country or countries really succeeded in overcoming the crisis and which still need to learn. This paper focuses on how the crisis started, discusses its the main causes, analyses what made it spread to other countries and how much it cost to countries involved in international trading. The impact of the global financial crisis on the world economy A Review of the Litearture The beginning of the 21st century was marked by the start of one of the severest financial crisis that affected dramatically almost all countries of the world. Launched in the USA, in 2008 due to the failure of Lehman Brothers investment bank, it spread out quickly to other countries destroying...
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...Banking Academy | City University of Seattle | CORPORATE FINANCE THE GLOBAL FINANCIAL CRISIS 2008 Group’s member:Nguyễn Như Nam (C)Phan Thu AnNguyễn Thùy DungHoàng Bá SơnNgô Thị Ánh TuyếtDate: 28/11/2014 | AbstractIn 2008 the world was fell into the worst financial crisis since the Great Depression of 1929-1933. Although this crisis has gone, however, its consequences for the economy of many countries is very serious, even now many nations are still struggling to escape difficulty. Just in a short period, the crisis originating from America has spread to all continents. It led to a series of serious consequences such as the falling in stock markets, increasing in unemployment rates, large financial institutions had been collapsed or bought out, and governments in many strong countries had to come up with rescue packages to bail out their financial systems. So why does it have tremendous destructive power? What are its causes and its development? What are the consequence it bring to the world? And what are the lessons drawn from this terrible event? Derived from these questions above, this paper will generalize about the global financial crisis 2008. | Table of Contents Abstract i 1. Background 1 2. Reasons 2 2.1 The housing bubble 2 2.2 Fed had lower interest rates for a long time. 2 2.3 The subprime boom 3 2.4 Securitization (MBS, CDO) and Credit default swaps (CDSs) 3 2.5 The credit rating companies. 5 2.6 Structured investment vehicle...
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...Financial Crisis By Hisham Al Rawashdeh Under supervision of PhD Muna Al Muallah Financial Management Petra University Jan 2016 Table of contents:- • Definition • Types of Financial crisis • Financial Crisis Causes • Theories • Financial Crisis of 2008 • Implications of Financial Crisis of 2008 on the emerging market. • Next Financial Crisis. • References Definition The term financial crisis is applied broadly to a variety of situations in which some financial assets suddenly lose a large part of their nominal value. In the 19th and early 20th centuries, many financial crises were associated with banking panics, and many recessions coincided with these panics. Other situations that are often called financial crises include stock market crashes and the bursting of other financial bubbles, currency crises, and sovereign defaults. Financial crises directly result in a loss of paper wealth but do not necessarily result in changes in the real economy. Financial crisis and Economic Crisis • Financial Crisis usually occurs in specific sectors, unlike the economic crisis which affect the entire economy. • If left unchecked, the financial crisis implications can lead to an economic crisis. In early 2008, many felt that this financial crisis would be limited to the banking sector and the housing market. However, the shortage of credit has had a very powerful impact on the real economy. Because banks are not lending, investment...
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...Global Lessons from the Recent Financial Crisis: Need for Reforms Jason Khan – 212857264 Yiwen Shen – 212828810 Alexander Grynszpan – 212811618 Xueyan wu - 212828380 INTRODUCTION Mortgage Backed Securities Lack of Regulations in the Banking System Lack of Regulations in the Credit Rating Agencies Subprime Mortgages Financial Crisis of 2007-2009 Lack of Regulations of over-thecounter derivatives Introduction to the Financial Crisis Causes of the Financial Crisis Reforms introduced International response Conclusion Cause: Subprime Mortgage - Housing prices were on the rise à More difficult for consumers to purchase - Investment banks purchased the mortgages from individual lenders, re-packaged them, and sold them to an even larger quantity of small and large investors - Borrowed money to magnify the outcome à Created collateral debt obligations (CDO) - Mortgages were sometimes given without down payments, or assurance of repayments - When the housing bubble “popped”, investment banks held massive debts without means of paying them à led to declaration of bankruptcy Introduction to the Financial Crisis Causes of the Financial Crisis Reforms introduced International response Conclusion Cause: Mortgage backed securities - Important players in the Crisis: Federal National Mortgage Association (FNMA), and the Federal Home Loan Mortgage Corporation (FHLMC), or as known as Fanny Mae ad Freddy Mac - Through mortgage backed...
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