...proper business ethics from employees, shareholders, board of directors, the CEO and the American people. I feel that all businesses need to promote accountability, transparency, and compliance, corporate governance systems and rely heavily on “gatekeepers”—corporate directors, in-house and outside counsel, and internal and external auditors. We need to revolutionize and rebuild trust and confidence again in the business world. Confidence in the character of the business world will enhance predictability, reliability, dependability, integrity, and regularity. Trust will give the business world a form of freedom. It will allow the business world to explore new directions, possibilities, and alternatives. Although trust always has its limits and always involves risk, trust frees the business institution from the need to continuously recheck, rethink, and reanalyze every decision and action they make. But we still need to have “gatekeepers” to keep executives from committing fraud again. Savings & Loan Scandal There have been many disappointments in my lifetime and that’s just in the past 30 years where the government has had to step in and provided some assistance at the expense of the American people. We can go back to the early 80’s when all the Savings & Loans went belly up and the government had to interfere and bail out all of them. The government spent billions of dollars to clean this mess. It was called the worse disaster since the Great Depression. Congress passed...
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...Consumer Information Guide 2015–2016 August 2015 Table of Contents Consumer Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 About University of Phoenix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Accreditation, Licensures, Reviews and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Federal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Regional Accreditation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 State and International Licensures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Program Accreditation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 School of Business/Business Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 College of Health Professions: School of Nursing . . . . . . . . . . . . . . . . . . . . . . . ...
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...Savings and Loan Association In 1978, Charles Keating, Jr. began focusing his time and energy on his business endeavours when he founded the real estate firm, American Continental Corporation (ACC). Six years later, ACC acquired Lincoln Savings and Loan Association, which was headquartered in Phoenix, although its principal operations were in California. In his application to purchase Lincoln, Keating pledged to regulatory authorities that he would retain the Lincoln management team, that he would not use brokered deposits to expand the size of the savings and loan, and that residential home loans would remain Lincoln's principal line of business. After gaining control of Lincoln, Keating replaced the management team; began accepting large deposits from money brokers, which allowed him to nearly triple the size of the savings and loan in two years; and shifted the focus of Lincoln's lending activity from residential mortgage loans to land development projects. On 14 April 1989, the Federal Home Loan Bank Board (FFILBB) seized control of Lincoln Savings and Loan, alleging that Lincoln was dissipating its assets by operating in an unsafe and unsound manner. On that date, Lincoln's balance sheet reported total assets of $5.3 billion, only 2.3 percent of which were investments in residential mortgage loans. Nearly two-thirds of Lincoln's asset portfolio was invested directly or indirectly in high-risk land ventures and other commercial development projects. At the time, federal authorities...
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...bank | The financial institution that manages the government's finances, controls the availability of money and credit in the economy, and serves as the bank to commercial banks. | | | | European Central Bank (ECB) | The central authority, located in Frankfurt, Germany, which oversees monetary policy in the common currency area. | | | | Federal Reserve System | The central bank responsible for monetary policy in the United States. | | | | Financial institutions | Firms, such as banks and insurance companies, that provide access to the financial markets, both to savers who wish to purchase financial instruments directly and to borrowers who want to issue them; also known as financial intermediaries. | | | | Financial instrument | The written legal obligation of one party to transfer something of value (usually money) to another party at some future date, under certain conditions. | | | | Financial market | The part of the financial system that allows people to buy and sell financial instruments quickly and cheaply. | | | | Financial system | The system that allows people to engage in economic transactions. It is composed of five parts: money, financial instruments, financial markets, financial institutions, and central banks. | | | | Information | A collection of facts. The basis for the third core principle of money and banking: Information is the basis for decisions. | | | | Markets ...
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...Fall 2012 [pic] ECO 212 – Macroeconomics Yellow Pages ANSWERS Unit 3 Mark Healy William Rainey Harper College E-Mail: mhealy@harpercollege.edu Office: J-262 Phone: 847-925-6352 Consumption and Saving Functions Y C S APC MPC APS MPS _____________________________________________________________________________________ 0 40 - 40 -- -- -- -- _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 100 120 - 20 1.2 .8 -0.2 .2 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 200 200 0 1 .8 0 .2 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 300. 280 20 .93 .8 .07 .2 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 400. 360 40 .90 .8 .10 .2 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 500. 440 60 .88 .8 .12 .2 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 600. 520 80 .87 .8 .13 .2 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ...
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...During this time, banks were not subject to any special regulations which resulted in the number of banks growing from 25 in 1800 to over 1300 by 1860. The result of this nonregulated banking explosion was the use of fraudulent activity by the banks toward the public. Due to this activity, the National Bank Act of 1863 and 1864 was passed which provided for a system of banks to be chartered by the federal government. The way in which banks have functioned over that time period to the present, has been determined by events that have occurred in the financial arena. In the late nineteenth century, the U.S. Treasury was unwilling to issue additional bank notes to some eastern national banks. As a result, some states resorted to allowing local banks to print their own currency and in the 1890’s, when depositors attempted to withdraw funds, they were informed that their money was not on hand and not available. This later led to the passage of the Federal Reserve Act in 1913 which created the Federal Reserve Bank...
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...The Federal Reserve’s duties are to maintain the stability of the financial system, supervise and regulate banking institutions, conduct monetary policy and provide financial services to the government, such as operating the nation’s payments system. The establishment of the Federal Reserve System and how it conducts monetary policy, through interest rate variance, reserve requirement, money supply and several other programs, is fundamental to understanding the economy as a whole. The Federal Reserve Act, also known as the Glass-Owen Bill, was passed December 23, 1913 under President Woodrow Wilson (Goodseek.com). The Federal Reserve was born from the National Monetary Commission which proposed that the country needed an institution to deal with a poorly regulated banking system that was responsible for economic downturns (WFHumel.net). The original 1913 bill stated that the original act was “to have succession for a period of twenty years” and yet there have only been minor adjustments to the bill since that time (Goldseek.com). Federal Reserve is comprised of 3 divisions: the Board of Governors (BOG), the Regional Reserve Banks, and The Federal Open Market Committee (FOMC). The BOG guides the Federal Reserve’s policy actions, studies trends in the economy, and helps forecast the economic future, In addition, the BOG also participates in monetary policy-making on the FOMC, and is responsible for bank regulations and overseeing the operations of the Reserve Banks (Goodseek...
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...The Federal Reserve controls the economy of the United States through a variety of tools. They use these tools to shape the monetary policy of the United States in order to promote economic growth and reduce the rate of inflation and the unemployment rate. By adjusting these tools, the Fed is able to control the amount of money in the supply. By controlling the amount of money, the Fed can affect the macro-economic indicators and steer the economy away from runaway inflation or a recession. The Federal Reserve uses three main tools in order to control the money supply. The first tool is open-market operations. These operations consist of the buying and selling of government bonds to commercial banks and the public. Open-market operations are the most important tool that the Fed can use to influence the money supply (Brue). By buying bonds from the open market, the Federal Reserve increases the reserves of commercial banks which in turn will increase the overall money supply in the country. The opposite is true if the Fed sells bonds on the open market. By doing so, the Fed reduces the reserves of banks and, in turn, takes money out of the system. By being able to control how much money the commercial banks can lend, the Fed has a very powerful tool to adjust the economy. The second tool the Federal Reserve uses is the adjustment of the reserve ratio. The reserve ratio is the ratio of the required reserves the commercial bank must keep to the bank’s own outstanding checkable-deposit...
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...303 Money and Banking Final Exam Spring Quarter 2014 Prof. Giorgio Canarella PART 1. Problem on M1 Money Supply Determination. Show your work. Use a bluebook Assume that on January 1 2013 the Federal Reserve has determined that following parameters characterize the US economy: a) C/D = 0.2 b) ER/D = 0.3 These ratios have been defined in class and are assumed constant. c) MB = USD 12000000 d) Required reserve ratio on checkable deposits = 0.10. Find: 1) the M1 money multiplier 2) the M1 money supply 3) total reserves 4) required reserves 5) excess reserves 6) currency 7) demand deposits. On June 1 2013 the Federal Reserve increases the monetary base by USD 1000000. Find: 1) the new M1 money multiplier 2) the new monetary base 3) the new M1 money supply 4) the new total reserves 5) the new required reserves 6) the new excess reserves 7) the new currency 8) the new demand deposits. On October 1 2013 the Federal Reserve reduces the required reserve ratio on checkable deposits by 5%. Find: 1) the new M1 money multiplier 2) the new monetary base 3) the new M1 money supply 4) the new total reserves 5) the new required reserves 6) the new excess reserves 7) the new currency 8) the new demand deposits On January 8 2014 the Federal Reserve increases the required reserve ratio on checkable deposits by 15% and increases the monetary base by USD 2000000. Find: 1) the new M1 money multiplier 2) the new monetary base 3) the new...
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...Complexities of the Financial System Brandi Humphrey Professor Joseph Arbeiter Finance 100 January 15, 2014 Financial markets are defined as locations or electronic forums that facilitate the flow of funds among investors, businesses, and governments. There are four types of financial markets and they are; debt securities markets, equity securities markets, derivative securities markets, and foreign exchange markets. Financial markets are also known to facilitate the transferring of previously issued debt and equity securities from existing to new investors. Financial markets are where traders buy and sell stocks, bonds, derivatives, foreign exchange and commodities. U.S. financial markets impact the economy because it can influence prices, whether they increase or decrease. For instance when there is too much money in the real estate market, interest rates plummet. This caused peopled to take out loans, even if they were considered ineligible buyers thus creating unacceptable risks to investors who began selling them to get rid of them. This causes a crash in the real estate market and also leaves the investors high and dry. Finance is one of the most important functions of any business. Companies are financed in one or two ways; debt or equity. The definition of debt is the amount owed or that one is bound to pay to or perform for another and equity is defined as the funds supplied by the owners that represent their residual claim on the firm. Debt financing is a negative...
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...The Federal Reserve acquires its unique powers through its ability to issue money. Open your wallet or your purse and take a look at some bills. At the top, you will see the words “Federal Reserve Note.” In the past, many banks issued their own bank notes, which were used as money. But today the money we use in the United States is provided by just one bank, the Federal Reserve. Thus, the Federal Reserve has the power to create money—an awesome power that forms the centerpiece of this chapter. The Fed doesn’t have to literally print money. It can, as we shall see in more depth later in this chapter, also create money “by computer” by adding reserves to bank accounts held at the Fed. This new money can be given away or lent out in a way that increases aggregate demand. If the Federal Reserve is a bank, who are its customers? The Fed is both the government’s bank and the banker’s bank. As the government’s bank, the Fed maintains the bank account of the U.S. Treasury. When you write a check to the IRS to pay your taxes, the money ends up in the Treasury’s account at the Fed. In addition to receiving money, the U.S. Treasury also borrows a lot of money and the Fed manages this borrowing—that is, the Fed manages the issuing, transferring, and redeeming of U.S. Treasury bonds, bills, and notes. Since the U.S. Treasury is by far the world’s largest bank customer—it has more income and it also borrows more than any other bank customer—the Federal Reserve is a large and powerful bank...
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...Money, Banking, and the Financial System, 2e (Hubbard/O'Brien) Chapter 1 Introducing Money and the Financial System 1.1 Key Components of the Financial System 1) The financial system is primarily a means by which A) funds are transferred from savers to borrowers. B) money is put into circulation. C) the government puts into operation its plans for the economy. D) business firms distribute their goods. Answer: A Diff: 1 Page Ref: 4 Topic: financial system Objective: Identify the key components of the financial system AACSB: Reflective Thinking 2) Which of the following is NOT a financial asset? A) a bond issued by Google B) Wells Fargo Bank C) a home mortgage loan D) a certificate of deposit Answer: B Diff: 1 Page Ref: 2 Topic: financial assets Objective: Identify the key components of the financial system AACSB: Reflective Thinking 3) If you buy a bond issued by Intel, the bond is a(n): A) liability to Intel and an asset to you. B) liability to you and an asset to Intel. C) liability to both you and Intel. D) asset to both you and Intel. Answer: A Diff: 2 Page Ref: 4 Topic: financial assets Objective: Identify the key components of the financial system AACSB: Reflective Thinking 4) Which of the following forms the largest share of household holdings of financial assets? A) corporate equities B) bank deposits C) pension funds reserves D) life insurance Answer: C Diff: 1 Page Ref: 9 Topic: financial assets Special Feature: Making the Connection...
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...Federal Reserve Report Federal Reserve Report Background The central bank in the United States is called the Federal Reserve System. The Federal Reserve System serves several purposes. Some of the purposes that the Federal Reserve serves include controlling monetary policy, overseeing financial institutions, banking for the government, distributing money, loaning money as last resort, and provide banking for commercial banks. The Federal Reserve is made up of 13 banks. The first 12 banks have their own region. The 13th bank is the headquarters located in the capital, Washington D.C. The Federal Reserve is independent of the government it is not part of the Department of Treasury. In some countries, like England, the central bank is part of the government (Colander, 2010, p.341). The Federal Reserve has a leadership group called the Federal Open Market Committee or FOMC. The major function of the FOMC is to select monetary policies. The FOMC is made up of a group of governors that are appointed by the president. The Discount Rate The discount rate is an interest rate. When commercial banks borrow money from the Federal Reserve it is just like when a normal citizen borrows money from a bank, the loan is paid bank with interest. The discount rate is “the rate of interest the Fed charges for loans it makes to banks” (Colander, 2010, p.348). The discount rate is controlled by the how commercial banks borrow. The Federal Reserve is a last result bank, this means they only want...
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...Complexities of the U.S. Financial System Briefly describe one (1) way the U.S. financial markets impact the economy, one (1) way the U.S. financial markets impact businesses, and one (1) way the U.S. financial markets impact individuals. Companies sell stock to raise money. Once a stock begins trading in the secondary market, its change in price has no direct effect on the company that issued it. Regardless of the wavering of the stock price, the issuer would still have the money raised to fund their company. Without a doubt, every company wants to see their stock prices rise. Despite mixed opinions, there is a strong positive relationship between financial market development and economic growth. The markets help to efficiently direct the flow of savings and investment in the economy. Credit-rating agencies are known to be influenced by stock prices, and their decisions have a large effect on the availability of credit to the firm. Regulators, who take actions that affect firm cash flows (most prominently, in the case of banks), follow market prices very close. Business owners with good ideas are constrained by the amount of capital they can raise. Although they can use their own money and borrow from their family and friends, these are limited sources of capital. Eventually, as they desire to grow their companies or reach their potential, they have seek to fund-growth using other people’s money. They can borrow from fellow citizens under a contractual obligation to pay...
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...FEDERAL RESERVE • In 1913 the Federal Reserve Act was passed, establishing reserve requirements for those commercial banks that chose to become members. • There are 12 Districts across America • It earns most of its income in the form of interest on its holding on US. Government securities as well as providing services to financial institutions. • The income earned is transferred to the Treasury • It regulates commercial banks and conducts monetary policy, adjusting the money supply to achieve full employment and price stability ( low inflation) • Has five major components o Federal Reserve District Banks o Member Banks o Board of Governors o Federal Open Market Committee o Advisory Committees Federal Reserve District Banks • Federal Reserve District Cities: o 1. Boston, Massachusetts o 2. New York, New York (Most important District City) o 3. Philadelphia. Pennsylvania o 4. Cleveland, Ohio o 5. Richmond, Virginia o 6. Atlanta, Georgia o 7. Chicago, Illinois o 8.St. Louis, Missouri o 9. Minneapolis, Minnesota o 10. Kansas City, Kansas o 11. Dallas, Texas o 12. San Francisco, California • Commercial banks that become members must purchase stock in the FED • Each District has 9 members o 6 are elected by member banks in which 3 are professional bankers and 3 are engaged in business o The remaining 3 are appointed by the Board of Governors o All nine directors appoint their Fed district bank president • District banks facilitate...
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