The Symbiotic Relationship Between the United States and Britain Essay

The Symbiotic Relationship Between the United States and Britain - Essay Example The Second World War was initially fought on the European Continent and American role was marginal till it came under Japanese attack at Pearl Harbor in December 1941. The American masses were generally against participation in a Continental War. The British were facing a crisis of sorts as France was overrun and the Soviet Union came under the throes of the biggest threat ever, Churchill the British Prime Minister was left to Britain’s dogged determination to survive the critical days till America joined the war effort. The incidents leading to Pearl Harbor, America’s reaction to Japan’s surprise attack and British response denote that Churchill had foreseen the eventuality of this strike and declared war against Japan within 24 hours. It was a momentous event and Churchill could not hide his glee at finally drawing America into the Great War, as this tipped the balance in favour of the Allies. (Churchill: 1970). A key event which not only determines the course of the Second World War but also the post-war alliance was drafting of the Atlantic Charter. Churchill had developed a personal rapport with the American President, Roosevelt. Drafting of the Charter was a triumph of Anglo American cooperation. The declaration included provisions as no territorial aggrandizement or changes by the alliance partners, right of people to choose the form of government, fair and equitable distribution of resources and creation of peace and stability within nations as also on the high seas. (Churchill: 1970). The United Nations was thus formed after the war and a number of nations freed from colonial dominance.

Harriet Jacobs, Incidents in the Life of a Slave Girl, Written by Essay

Harriet Jacobs, Incidents in the Life of a Slave Girl, Written by Herself - Essay Example It is because in male dominated society, female slaves were the worst sufferers of male lust. Also since women’s financial contribution was equal to their male counterparts’, they were often neglected the allowances which were normally granted to the male slaves. In the narrative, Jacob upholds the fact that the nineteenth century society was, in the first place, very much discriminatory to women. On top of it, slavery would permit the male dominated society to exert their brutal desires over the female slaves to the fullest extent. Such brutal treatment would never hold them accountable. In the narrative, Jacob shows that the evil of slavery puts the despotic males at the control of humanly institutions like motherhood, womanhood, etc. Therefore, the slave-owners not only denied humanity by continuing slavery, but also reached the extent to oppose the most sacred institution of womanhood as well as motherhood. When Jacob says that â€Å"Slavery is terrible for men; bu t it is far more terrible for women†¦Superadded to the burden common to all, they have wrongs, and sufferings, and mortifications peculiarly their own† (Jacobs 23), she refers to a masculine but horrible face of slavery in the context of femininity. In addition to what the slaves, whether they are male and female, suffer from, a female slave has to suffer vehemently from a torrent of emotional anguish first as an object of lust and then as a mother. Different from other slave narratives, Jacob has used the scope to view slavery from a quite different angle. Jacob notes that most of the lave narratives of her era have a common pattern of depicting the graphic details of whipping, physical torturing, etc. Subsequently these narratives uphold a dangerous escape of their slave protagonists to the North. But Jacob depicts a quite different situation for a female slave. She shows that for a female slave, any attempt to escape from the slavery was more of a heart-piercing dilemm a because of their progenies. She could neither endure the torture nor leave their children behind and run away. So, their only way was to submit to their fate. But when other women would let themselves collapse under the crushing torture of slavery, Linda retains her mental strength to oppose Mr. Flint’s desire. Linda’s mental strength is evident in a speech: â€Å"When he told me that I was made for his use, made to obey his command in every thing; that I was nothing but a slave, whose will must and should surrender to his, never before had my puny arm felt half so strong† (Jacobs 46). Indeed, this simple comment of Linda tends to summarize the gist of the whole narrative as well as of the evil of slavery in American society during the early nineteenth century. It can be viewed from different perspectives and angles. As a mother, Linda violently fights against slavery. She wants to save her children from the evil of slavery. She plays hoax on Mr. Flints in ord er to attain freedom for her children, Benny and Elena. She had to spend innumerous sleepless night in the tight attic in which she can hardly stand. But her only pleasure is that she can see her run around her Aunt Martha’s house freely. Indeed, for any male reader, such sacrifice may seem to be something mere, but the pains, sufferings and angst she undergoes during those days of slavery are

Determining the Status of an Independent Contractor and Taxes Essay

Determining the Status of an Independent Contractor and Taxes - Essay Example Avoiding taxes is not the primary goal of an independent contractor but they know if they are classified as employees they suffer some consequences. Some of the consequences one suffers are that they might not be hired by the hiring firm since they these firms will be forced to pay additional expenses of treating them as employees. The aims of the firms to maximise their profit and to ensure they achieve their goals, they have to ensure that they minimise their operational expenses. For this case, if an independent contractor is classified as an employee he will never be hired by the hiring firms. (Fishman, 2006) The other reason as to why the independent contractors do not need to be classified as employees is because they will add additional tax burden to themselves by being subjected to tax. Their pay will be deducted, something they would not be experiencing if they were independent contractor. (Fishman, 2006) According to Fishman (1997), the U.S Bureau of Labour Statistics shows that in U.S.A alone, there are eight million independent contractors and in the next ten years, this number is expected to double. The use of independent contractors is beneficial companies that cannot afford to hire permanent employees especially small and medium ones. This is especially so for those companies that can not be able to employ a permanent employee for specialized function. For instance, a company engaged in international commerce can hire an attorney who has specialized in international trade as an independent contractor to provide international legal advice. This staffing approach is more affordable than employee a permanent employee and for this case due to the fact that this attorney's salary will not be taxed, then it does not mean he want to avoid paying the tax. 1 Permanent employees have been given a great deal of job security by European laws and because of these laws, the economic uncertainty has forced employers to use short-term contracts than using permanent employment. These short-term contracts are the use of independent contract and statistics shows that this tread is on the increase. In every five employees in France, one is on part-time contract; 30 percent of workforce in Britain is on temporary employment; in Spain, for every ten jobs created, seven of them are on temporary basis; and the ban on private temporary employment agencies has been lifted in Germany. These statistics shows that there is great rise in the use of independent contractors in many European countries. The use of independent contractors has become popular since it reduces costs and legal requirements imposed on termination or lay off of employment in Europe. Due to the fact that the temporary employees hired by companies under temporary employment does not mea n that they are avoiding paying taxes since they employment is being dictated by circumstances. (Templeman, 1996) Independent contractors results in cost savings which include: reduced book keeping and payroll preparations costs, avoidance of taxes, reduced fringe benefits, elimination of worker's compensation benefits, elimination of overtime pay, decreased administrative burdens and reduction in capital and maintenance costs if the independent contractors provides their own tools and equipment. (Bureau of National Affairs, 1994; Stalnaker, 1993). Even though independent contr

Music and no music condition Essay Example for Free

Music and no music condition Essay The use of music seems to be a good way of operationalising the IV as many people do learn to the sound of music so therefore the difference between the music and no music condition should be marked. Also, getting the participants to write down the words is a good way of measuring the DV as it means it is easy to collect and analyse the data.  The study itself was quite simple and it seemed to measure what effects music has on learning. The independent variable was manipulated in such a way that it was hard for there to be anyway the results could have been affected significantly. Also because the measurement method was very simple there isnt a chance that the results could be interpreted in the wrong way. As the study was a laboratory experiment it doesnt have as high validity as a field experiment. Although the participants were not in a strange environment, the fact that they knew they were being studied may lower the ecological validity of the study.  Leading on from the fact that the study might have bad ecological validity, there is also the problem of the study having bad participant reactivity. Seeing as they know they are being studied and they know they have to learn the list of words given to them, they may try much harder than they normally would in their everyday life. There is the factor of social desirability and how some participants may deliberately try to recall fewer words. Improving Validity  Although it would be very difficult and expensive it could be possible to take the study outside the laboratory to increase the ecological validity of the study. You could monitor the participants while they are learning for something at home and while they are playing their own music in their rooms. They could then be tested unknowingly at school by one of their reachers.  However, even if these changes were made, the results would probably still stay the same. It has been proved before by numerous studies done by different scientists that music does help when trying to learn. This is why students are encouraged to listen to wordless music when revising for exams. These changes would also help improve participant reactivity if they are studied in a familiar environment. It would give them a sense of security and the need to look cool is not needed anymore and there is no extra pressure put on them to learn because they dont have the feeling they are being examined.  So, these changes could actually change the results slightly if only with a few participants. It might be found that there is higher recall in both conditions though but the difference may still stay the same. Reliability  The study is very easy to replicate as there is many references to other studies similar to it. Also because the study is quite simple in itself and very cheap to do there are very rarely any problems in recreating it for different purposes.  One possible confounding variable was introduced by the fact that there were four researchers in the room at the time of the study and they all knew the hypotheses. They may have tried give the participants help in recalling the words by giving hints and clues so that the results were more conclusive. This may have led to unreliable comparisons between conditions. As the study was a laboratory experiment it meant the researchers had good control over the study. The words that were chosen were all unambiguous so the participants would not have interpreted them in different ways. Also the test had been severely standardised. The words were shown on an over head projector so they were all looking at the same thing when learning was taking place. Also the testing was completed in the same room and at the same time of day for each condition so the participants were not feeling more tired in one condition than the other. Improving reliability  The only possible way to improve reliability was to keep researcher contact to a minimum or have a person in the room that was unaware of the hypothesis so they couldnt alter the study in any way. This would be difficult though because once they are in the room it does become quite obvious what the study is about.  This could be controlled for by using an outside civilian to be the one person giving the participants instructions on what they have to do. There could be one person chosen for each condition so that they dont guess what the study is about.  Even if these changes did increase the reliability of the study the only difference they might make to the results is to decrease the differences found between the two conditions.

Education Essay Essay Example for Free

Education Essay Essay Education is a vital part of growing up. Without it, our potential cannot be utilized. We use education to make decisions, interact with others, and survive in general. In order for society to improve as a whole, we must use our education to improve on the knowledge we have already attained. Public education gives American citizens the chance to become critical thinkers, prepare for work, and compete in a global marketplace. Public education has transformed into a corrupt system. A system centered around the GPA. Getting a good percentage is the only thing that seems to be important in school. The only thing students care about is how they can pull off a 4.0. Even the teachers’ focus is on the grades. Teachers are rated based off how their students did on standardized tests and their grades. There is almost no focus on the pure attaining of knowledge. Once a student finishes a class, about 90% of the information they learned is lost. There is almost no importance on retaining knowledge after they finish testing on it. Students only about care their grades because that is what colleges look at. Everyone strives for that 4.0 GPA so they can get into their dream school. Once students get to college, their focus goes from learning to get a good grade to learning to prepare for their job. College students have to truly understand and retain the information they learn because it is important to their potential career paths. Although many problems can be found in public education, there are few that can actually be solved. Public education cannot be easily changed without disrupting the foundations of what public education does for students. If we change our focus from grades to pure learning, colleges would have no way of judging a student. It is the nature of the beast.

Impact of interest rate changes on bank profitability

Impact of interest rate changes on bank profitability Over the years, banking system in Pakistan shown enormous growth and potential. The performance and stability indicators showed significant improvement in the profitability of banking system. But now a days banking sector going under pressure. Such as liquidity crunch and solvency problem have significant impact on the performance of banking sector and economy. The financial institution could have managed the situation without any trouble if they have sufficient amount of liquidity available to fulfill their obligation. Since they are operating in very tight market conditions. So, they are forces to pay attractive rates to depositors to attract liquidity. Although the State Bank of Pakistan reduced the Cash Reserve Requirement (CRR) and Statutory Liquidity Requirement (SLR) on demand and Time Liabilities to ease the liquidity in the market. The governments instead of developing their own recourses empower banks to generate money and then borrow from banks. The huge amount of borrowin g from banks by the government its disturbing the economy. The government not only curtails its borrowing from banks but also put some sort of check on power of money. All these factors have combined to set a stage where lending rates are high and having great amount of burden on banks financials. The amount of non performing loans increased at rapid speed despite of heavy amount of provision created by the bank in recent years. The increasing asset quality concerns would force the banks to book heavy provisions for non performing loans (NPLs). The stability of the banking system is conditional upon the stability of overall economy. A stable macroeconomic environment contributes to effective and efficient growth of saving and investment decision. Appropriate macroeconomic measures should support the functioning of the banking system more specifically in the areas of financial stabilization, transparent fiscal policy and monetary policy. The major contributor role of effective and efficient growth in the economy is played by the State Bank of Pakistan and provides guideline to the financial institution to play their role in the development by mobilizing the resources of the economy and facilitating the investors. The success of a bank also depends on the ability to forecast and avoid risk, to cover the losses brought about by the arisen risk. Profit is the important requirement of a competitive banking institution and the cheapest source of funds. It is essential to see it not simply as a result, but also a necessity for successful banking in a growing competition on financial market. These important facts together are the reason for this to focus on the current topical issue of banks profitability. We will highlight problems which are influencing on banks effectiveness and efficiency to manage their portfolio such as assets and liabilities in aiming at to achieve profitability and identify the areas where it might have possible room for raising the bank profitability. Banks assets are grouped into two categories earning assets and non earning assets. Earning assets means those on which banks earns interest income and non earning assets means those which used for the purpose reserve requirem ent, fixed assets to run day to day operational activities. In this study we have focus on earning assets. This included Placement and lending to financial institution, investment in securities and loan advances. These assets are the major source of income for bank. Therefore, it is apparent that average income generation ability of these assets has a decisive influence on the banks profitability. As financial intermediary, banks play a vital role in the operation of most economic development. The efficiency of financial intermediation can also affect the economic growth. Banks are different from other firms in that they provide financial services, the reward to which is an interest rate, and the most of the funding are financed by the deposits or borrowing, the expense of which is also an interest rate. Interest margin, the difference between what a bank has earns on its earning assets and what is paid to depositor. It has been on upward trend during the last decade. An increase in the spread would affect the depositor or the borrower or both stand loose at same time. The lack of alternate avenues of financial intermediation aggravates the adverse impact of spread. For example, if the State Bank of Pakistan based on the monetary policy change the interest rate. Then the change in the interest rate influences the cost of capital that in turn affects the level of consumption an d investment decision. If the increase in the spread is due to decrease the rate to depositors then this discourage the saving, and alternatively if due to increase the rate it would have adverse impact on investment. Therefore, these changes in the interest rate have important implication on the economy. Banks are more sensitive to interest rate changes than most of the other institutions. The effect of interest rate changes on banks profitability has been an important issue for banking system. It has been argued that bank exposure to interest rate risk perhaps the most important issue in participating the saving and investment crises. 1.2: Problem Statement The impacts of interest rate changes have a significant impact on the bank profitability. When interest rate changes it would result in increase or decrease in the interest income of the bank and also have adverse affect on depositors saving and borrower investment decision. 1.3: Objective This research aims to study the impact of interest rate changes on banks profitability based on the following variables directly affecting the banks profitability Interest rate Balances with other banks Deposits accounts Lending to Financial Institution Investments Loan Advances 1.4: Research Scope and Limitation The scope of this research is to find out the impact of interest rate changes on banks profitability. There are few limitation involved in the study. The sample selection consists of five major banks. Which covers the 57% market share of the Pakistan banking industry. The basis for calculation of income is KIBOR rate. The banking system starts using as benchmark as KIBOR rate from 2002 onward. Therefore, our study period is 2003 2008. 1.6 Chapter Summary The banking sector shown enormous potential in previous years. Banking sector achieved high profitability and economy was stable. But from 2008 onward banking sector going through a financial crises such as liquidity and solvency problem. To control the uncertain condition of the country. The central bank reduces the Cash Reserve Requirement and Statutory Liquidity Requirement. So, banks have more liquidity to fulfill their obligations. On the other hand Central Bank increases the discount rate to control the money supply in the market. Which result in higher interest rates. Due to the increase in interest rate and financial crises borrowers default ratio increase and financial institution suffer large amount of losses during the period. This increasing amount of asset quality concerns would force the bank to book heavy provision for non performing loans (NPLs). The stability of the banking system is dependant on the economy. A stable macroeconomic condition will contribute to effect ive and efficient growth of saving and investment. Banks play as role of financial intermediary in the development of economy. If the central bank made any change in the monetary policy it will affect the performance of financial institution. Then the changes in the interest rate will affect the saving and investment. If the spread increases due to decrease in the rate to depositor then it will discourage the depositor and alternatively if due to increase in the rate to borrower then it will affect the investment decision. Therefore, banks are more sensitive to interest rate changes then the other institution. The effect of interest rate has been todays most important issue for banking sector. Chapter 2: Literature Review The study of Flannery, (1981) showed that large banking organizations (1978 assets greater than $2 billion) are well hedged against interest rate fluctuations. The large banks made necessary adjustment to avoid interest rate fluctuation by revising the repayment schedule rate as per the agreement with customer to minimize their interest rate risk. The some of the borrower pay quarterly, half yearly and annual payments. So, as per the agreement schedule bank revise the rates which minimize the risk of bank. When market rate change, the large banking organization made necessary adjustments to avoid interest rate volatility in revenue and cost. The mostly organization have mis matched balance sheet such as they borrow from customer and financial institution at shorter period or maturity and give lending to customer and financial institution at longer period. It would create mis match between balance sheet. Therefore, banks are exposing to interest rate risk and liquidity risk. To avoid the liquidity risk the banks develop relationship with financial institution to overcome their liquidity problem on immediate basis and for interest rate they minimize the risk by revising the interest rate of the contract as per the agreement. The finding of this article suggests that most bank posses a sufficient range of assets and liabilities choices to avoid the risk. This study employs annual data from the federal Reports of Income and Condition on individual insured banks in continuous existence from 1960 through 1978. Twelve banks were chosen at random from the national population in each of five asset size categories (based on year-end 1978 assets): less than $25 million, $25- 25-49.9 million, $50-99.9 million, $100-299.9 million, and greater than $300 million. Holding company subsidiary banks were excluded from the first four size million, $100-299.9 million, and greater than $300 million. Holding company subsidiary banks were excluded from the first four size groups; 3 banks above $300 million were included regardless of their subsidiary status, since large independent banks may not be representative of the population Flannery, (1983). In this study data collected from the federal report of income and condition f rom 1960 to 1978. Population of Twelve banks randomly chosen for analysis and break into 5 different assets size categories on the basis of 1978 assets: less than $25 million, greater than $25 and less than $49.9 million, greater than $50 and less than $99.9 million, greater than $100 and less than $299.9 million and greater than $300 millions. In this study holding companys subsidiary excluded from first four groups and greater than $300 million includes the subsidiary banks of holding company and regression techniques had been used in the analysis. The result of the study showed that commercial banks groups are substantial exposed to interest rate risk and individual bank choose alternatives to avoid such risk. Bank possess sufficient amount of funds available in the form of assets and liabilities to minimize those risk and try to get productive results. The study of Barajas et.al (1999) showed that a key variable in the financial system is the spread between lending and deposit interest rates. When it is too large, it is generally regarded as a considerable impediment to the expansion and development of financial intermediation, as it discourages potential savers with low returns on deposits and limits financing for potential borrowers, thus reducing feasible investment opportunities and therefore the growth potential of the economy. The key point of financial institution is the spread between Loan and deposits rate differences. When the lending rate is high and deposits rate is low then which results in higher the profitability for the financial institution but on the other hand it will discourage the depositor. Because the depositors getting low return on their savings and also discouraging for the borrowers because the financial institution charging high interest rate. If the financial institution doing the same then it would red ucing the saving confidence on depositor and borrower will try to avoid to borrow from financial institution. Which resulting in reducing the investments opportunities because the saving money not contributing to the economy. Financial system of developing countries showing larger spread difference as compare to the developed countries. Based on the balance sheet and profit loss information the author derived two data base. One data base developed on basis of quarterly data from 1974-1988 and other on the basis of monthly data from 1991-1996. In the period 1974-1980 the spread between loan and deposits increasing steadily and then start decreasing during the period 1981-1988 reached to 19 percent and again decreased during the period of 1991-1996. The evidence provided by the author clearly suggest that the during 1974-1980 spread increased and then during the 1981-1990 significantly decreased. This showed that the loan quality during the period remained stable and reserve ratio re quirement decreased and consistent spreads and cost lower the productivity of the state bank. A study of Maisal, Robert (1978) showed that financial markets is the degree and rapidity with which financial institution react to new information and shift funds among asset and liability classes so as to equalize marginal cost and returns. Many analysts assume that markets are efficient, that transaction and information costs are negligible or unimportant, and that borrowing and lending hedging and arbitrage are simple and available at or close to risk free rates. As a result, they believe that they can successfully predict the results of all types of markets actions and reactions without concern for institutional forces. The financial markets are so efficient that they get rapidly information and on the basis of information they are making quick decision regarding the fund management such as assets, liability, cost and income. When all the information readily available then it reduces the cost and increase efficiency of transaction such as hedging and arbitrage without taking any risk on the basis of available information analyst predict their results of any market without considering the forces. The study conducted by author on the basis of cost and revenue of cross section banks during the period 1962-1975 estimation made on the basis of net rate of income and cost of book value of assets. The net rate is the difference between the gross revenue from assets minus cost of asset and rates are net of servicing, processing and overhead cost. The result showed that major shift occurred during the period of 1970-1975. Net returns of assets considerably differ when computed on the basis of average. The study of Demirgà ¼Ãƒ §-Kunt, Harry (1999) showed the differences in interest margins and bank profitability reflect a variety of determinants: bank characteristics, macroeconomic conditions, explicit and implicit bank taxation, deposit insurance regulation, overall financial structure, and underlying legal and institutional indicators. A larger ratio of bank assets to gross domestic product and a lower market concentration ratio lead to lower margins and profits, controlling for differences in bank activity, leverage, and the macroeconomic environment. Foreign banks have higher margins and profits than domestic banks in developing countries, while the opposite holds in industrial countries. Also, there is evidence that the corporate tax burden is fully passed onto bank customers, while higher reserve requirements are not, especially in developing countries. The study showed that variation between spreads and profitability comprised of various determinants. Such as economic condi tions, regulations and financial structure. As the banks have a high ratio of asset with respect to gross domestic product and have small profit margin and banks profits. Because of debts and economic conditions. Foreign banks usually have greater margin of profits as compare to the local or domestic bank in the developing countries and different outcome for industrial countries. This study also evidence that corporate tax had a direct burden on the bank customer because bank transfer the tax burden to their customer while reserve requirement of central bank doesnt not have a significant effect on banks. The data collected at the level of banks for 80 institutes and period comprised of 1988-1995 on the size and decomposition of banks spreads and profits. Regression technique had been used to find out the determinate of interest rate spreads and banks profitability. Taxation and regulation have big impact on bank customer and overall bank position. The banking system varies from coun try to country around the world in size and composition and structure. All banks have different influence of macroeconomic conditions, regulation and market conditions. Several countries data had been used for analysis to find out the bank characteristics and conditions which affect the banks performance such as interest margins and profitability. Some variable have positive relationship with each other and some of them have a negative relationship with each other i.e. reserve ratio to profitability. The study of Samuelson Paul A, (1945) showed that the banking system as a whole is not really hurt by an increase in the whole complex of interest rates. It is left tremendously better off by such a change. If a bank were a university, nobody would doubt that it would be made better off by an increase in the interest rate. At worst, it could continue to hold all existing gilt-edge securities to maturity and be no worse off. As these matured, the proceeds could be invested at higher rates with a resulting increase in income. It would be better off in the sense that ceteris paribus it could hire more teachers per year, spend more money on buildings and stadia, and engage in more research. The only exception would be in the limiting and unrealistic case where all its money was invested in perpetuities. But even here it would be no worse off. In every other case it would be better off. The increase in the interest rates usually not affects the performance of bank, its actual effect on th e borrower. When the interest rate increases then borrower will bear the effect of increase interest rate. But it would not affect the bank performance .The reason is that the bank pay low return to depositors and charge more to borrower as interest rate increases. So, both depositor and borrower will bear the cost. In this article author taken the example of university. If this loan given to the university it certainly impact on the university performance because of increase in the interest rates. As the interest rates increases it would become more costly for the university and difficult to pay to the bank on time. The increase in the interest rates would not hurt university as its decreases capital value. This change would have a better impact on university. The study of Coleman George W, (1945) showed that the banking system would recover these losses over a period of time, the length depending upon the maturity distribution. During that period, it would be frozen in to a given maturity pattern. The earnings of the banking system upon the existing portfolio would increase. He states that immediately after interest rates have risen and capital values have scaled down, all parts of the portfolio, old as well as new, began to earn the higher rates. The rise in the interest rates bank can come up with some loss on the portfolio such as investing in the securities of longer period. The bank can recover this cost over the period of time and get desired returns and also increase in the capital of the bank. When the investment is carried at cost then it would amortize cost. It means banks amortize the investments over the period of agreement until it becomes zero. When the interest rate rise it would have immediate effect and bank re-prices the portfolio on the current interest rate and gets benefit of the opportunity. The objective of the study to find that increase in interest rate would not a sufficient impact on banks. Its directly influence on the saver or borrower. Which ultimately result in decrease in saving and investment. The management of bank continuously monitoring and updating their portfolio policies to minimize such risk. The study of Khawaja, Musleh, (2007) showed that Interest spread of the Pakistans banking industry has been on the rise for the last two years. The increase in interest spread discourages savings and investments on the one hand, and raises concerns on the effectiveness of bank lending channel of monetary policy on the other. The interest rate spreads in banking sector on the upward move. When the interest rate increases its discourages the depositor and borrower. Such as saving and investments. Banks giving low returns to depositors which results in discouragement and getting high return from borrower by charging high interest rates inclusive of spreads. Spreads are much high in Pakistan. When spreads taken into account ultimately the interest increase and banks gets high returns on lending and investments. The depositor not has any other option to save his money and also the strict requirement of SBP capital requirement. The industry has rapidly merger and acquisition. This results in decrease in the option for saving. In this study author used data of 29 banks. Variant model had been used to check variables relationship. The results showed that inelasticity in deposits supply have positive impact on interest rate spreads. To lower the spread margin central bank play a vital role to reduce the spread and other alternative would be the financial intermediary which lower the spreads. The study of Chirwa, Montfort, (2004) highlighted the importance of financial liberalization in facilitating economic development and growth. While there is no complete agreement on the removal of financial repression, usually characterized by control of interest rates, imposition of credit ceilings, and credit rationing, leads to significant amelioration of growth prospects, the dominant view is that financial liberalization and growth usually go together. Financial liberalization had a great influence on improving the economy and increasing growth. There is no certain agreement made on the financial repression. The management made certain tool and polices to control the interest rate impact on credits. Such as by applying tool of checking limits and there purpose of credit extension. The good control over the interest rate would have a significant on the performance of economy and growth of the country. Financial liberalization and growth of the economy work to gather and run head to head and boost the development of economy. The determinants of interest spread and bank profitability have been often used in the model. In portfolio choice bank trying to maximize their good portfolio. This maximizes the profitability of the banks. Bank usually made feasible choice of assets and liabilities with respective tenor interest rate. This study used monthly panel data from banking system between 1989-1999.the findings of that study showed that the after liberalization the interest rate significantly increased. The main cause of that increase was the increase in nonfinancial cost, provision for doubtful debts, taxation and variation in the inflation rates. The study of Marisel Peter, (2002) showed that in the world of endogenous money, the central banks role in monetary policy is reduced to the setting of a very short term official rate of interest, which indicates the price at which it will make liquidity available to the banking system. However; it is changes in market rates that affect behavior; and so the ability of the central bank to influence anything at all depends, first, on the interaction between official and market rates. In this paper, we use a vector autogressive error correction model to explore the response to changes in the central bank rate of three short-term market rates that have been featured previously in this journal in debates about the demand for endogenous money. The main responsibility of the state bank is to control or reduce the rates which affect the price and liquidity of the banking system and affect the availability of liquidity of the banking organizations. The fluctuation in the market interest rates will affect the function of the banking system and as well as the behavior of the consumer and economy. In this study autoregressive correction model had been used by the author to find out the responses of interest rates changes and its effect. When spread between Corporate Government bond increases then the market assume that the risk on the bond increases. When they see then they try to predict the coming slowdown and recession in the economy. After testing they have found that it would have a positive effect on the economy. They have used the Autoregressive model to test the fluctuation in prices and interest rates. The result of the paper showed that the short term interest rates have a significant impact on the banking system as compare to the long term interest rates. Short term interest rates were the major instrument of the monetary policy of the central bank. In monetary policy central bank advice the interest rates which would affect the banking system as well as the ov erall economic activities of the country. 2.1: Chapter Summary The impacts of interest rate changes have a significant impact on the bank profitability. When interest rate changes it would result in increase or decrease in the interest income. The Pakistan banking industry use Karachi Interbank Offered Rate (KIBOR) for earning assets to find out the interest income. The major portfolio reprice on 6 M KIBOR. Bank is exposing to interest rate risk. But usually bank hedge against interest rate risk to minimize its impact on bank performance. The major impact of interest rate changes would affect the depositors and borrowers. Because when interest rate changes it would discourage the saving and investment decision.

Education in a Sociological Sense: Article Summaries Essay -- Sociolog

I have chosen two articles in relation to education. The first article determines whether education plays a vital role in religion in Scotland, whereas the second article attempts to present a connection between educational attainment and cultural capital. This assignment will summarise the articles I have chosen to read, which will provide me with a wider understanding of education in a sociological sense as opposed to my original common sense. The first article I will examine concerns educations role in religion within Scotland. ‘The relationship among religion, education and opportunity has been a recurrent theme in debates about Scottish social policy since the 1920’s’ (Paterson 2006). The article commences by addressing a certain aspect of this frequent debate, if and to what extent certain religious groups have experienced social mobility and educations role within this experience. Paterson goes onto explain that to back up this theory she will analyse the results of the Scottish Household Survey conducted in 2001 to ascertain if ‘social mobility differs between the three largest groups in Scotland, and what, if any the role of education might be in that’. The three largest groups to which she refers are, ‘no religion’, ‘Church of Scotland’ and ‘Roman Catholic’. She attempts to uncover religious differences in mobility patterns, the role of educat ion and if these conclusions are somehow varied by gender. Paterson moves on to outline the surveys process and to illustrate the questions asked within the survey. She attempts to point out minor faults within the survey that may alter the reliance of specific results, ‘the survey asked all respondents only about their current religion, not about their religion of upbringing’. ... ... GCSE attainment’. In conclusion, from reading the two articles my knowledge on education when looking at it in a sociological sense has deepened and I am now more aware of the role that education plays in topics I never paired it with. For example, prior to reading the article involving religion and education, I had never thought of religion aiding my educational credentials. I had also never looked at cultural capital and how that the lack of awareness of certain aspects of culture may hinder my educational credentials and therefore my occupational desires. Works Cited Paterson, L & Iannelli, C (2006) Religion, social mobility and education in Scotland. The British Journal of Sociology. Vol 57, No.1, pp353-375 Sullivan, A (2001) Cultural Capital and Educational Attainment. The Journal of The British Sociological Association. Vol 35, No.4, pp893-911