Summary and 3 learnings Essay Example | Topics and Well Written Essays - 250 words - 1

Summary and 3 learnings - Essay Example Israel and United States have worked jointly to advance Stuxnet in to an extent that it can infect computers. The U.S has developed implants out of Stuxnet that infect the â€Å"firmware†; an embedded software preparing a computer’s hardware before its operating system starts. The implants are beyond the reach of most security controls and existing antivirus products, making it virtually impossible to stop it. Equation Group has been active for approximately two decades. It uses techniques of cyber attacks that surpass anything known to be sophisticated and complex in the virtual environment of networks and computers. The group has managed to perform firmware attacks, giving it the power to control almost anything concerning nuclear enrichment plants of U.S adversaries (Perlroth and Sanger). There are three issues which I have learnt from the articles. The first one is that American government Agencies do not use security software products made by Kaspersky Lab. This is because the lab was founded by a person who once served the Russian military, which is closely watched by the American agencies. The second one is that it is difficult to perform a cyber attack on computers with an â€Å"air gap system†; a system that separates computers from the outside world and is mostly used by U.S adversaries. The last issue learnt from the article is that the U.S Equation Group has made an effort of mapping out the so- called air-gapped

The perception of the perfect body image Essay Example for Free

The perception of the perfect body image Essay It is only now she realises that she got favoured over the less attractive staff and got more pay rises than most people do. He didnt even know my cousin, but flirted with her constantly because of her outside appearance. This eventually grew until she could take no more. Unfortunately she had to leave her job as a consequence. All because she was the victim of the perfect body beautiful. He hadnt known what her personality was like, he just seen a woman and abused that fact. This too is becoming a huge problem, not only is it the ugly people being targeted but also, the beautiful people. So what is it better to be? There are problems on both sides of unwanted attention and heavy flirtation that can become overwhelming and a nuisance yet these women shouldnt have to suffer because of their appearance. There is no escaping this type of prejudice. How could this be allowed to surface in the first place? Yet again it shows how shallow our society has become, when is it going to stop? Will it ever stop? Has it gone to far beyond repair? Theres no doubt about the influence of the media on womens self-esteem and appearance. On ITV they had a program Make me Beautiful, this is added pressure of women feeling so insecure about themselves that they are prepared to undergo plastic surgery to see themselves as beautiful. The program in itself is wrong as it is recognising that women have an issue with beauty, but is letting them change their bodies to justify this and make the social image of the perfect body beautiful become acceptable. This is also against Christian beliefs but because it isnt recognised as such, it makes it hard to deem an act against Gods word. Nevertheless, women should not become reconciled to the medias pressure. They neednt stick to the artificial images, but instead try to be beautiful in their own way. Women even tend to diet often which can lead to serious illnesses that include eating disorders, this is because of the media attention that is given to attractive women. People are fooled into thinking that if they can be a size six they will be beautiful, but often this isnt the case, and when the result isnt pleasing. Depression slides into play. It is an evil downward spiral of deceit that comes from the media pressure of celebrities. As most celebrities themselves support a range of diets and are painfully thin. This can be seen my Lindsey Lohan, a well-known teen actress who has suffered from strain of the public eye and has became increasingly thin. Which is worrying, as she is a role model for teenage girls. Yet there are some magazines that acknowledge this, we open The Sun and go to Bizarre column and we see the latest gossip about who is too thin. Although this has been recognised, the media and society do nothing to follow through their findings. A womans beauty comes from the centre; it is where her heart lies, where her personality beams up her whole body, it can be her interests, or what makes her happy. Or it can be just her simple loving thought. Women are cheated of their right to happiness. It isnt fair but until the public address the seriousness of this situation, when eating disorders rise, when suicides from bullying rocket and when more and more women become depressed, it may make the world wake up. The government is solving the waste problem; it is solving the peace problem, even the health problem with the recent non-smoking ban. But when will the time come to solve the body image problem that plagues our streets and will become one of the worlds top killers, which has been proved by Anorexia Wastes Life Association. The time to act is now, but is it too little too late when the statistics show death? Two weeks later the woman in this picture aged 22, died of Anorexia. All because she too wanted the Perfect Body Beautiful. i i Stefanie Jameson Show preview only The above preview is unformatted text This student written piece of work is one of many that can be found in our GCSE Miscellaneous section.

Dubai Property Market Economic Theory

Dubai Property Market Economic Theory With this dissertation what I would like to achieve is the following: I will carry out extensive research on the economic theory behind booms and bursts. I will look at some of the booms and bursts throughout history. I will attempt to make my own economic model behind what caused a boom and its subsequent burst and see if this model can be applied to the economic situation of the property market in Dubai. If a number of variables existed that suggested a burst might be coming, why was nothing done to stop it? 1.2: A brief history of Dubai Thirty years ago almost all of modern Dubai was desert. In the mid 18th century a small nomadic group settled there and built a small town. This small towns underlying asset being pearls. The pearl trade attracted people from all over the middle east, all with dreams of prosperity. The town was named Daba after a local locust that consumed everything it encountered. This rapidly growing town was soon acquired by the Gunships of the British army. Britain maintained control of the area until 1971(The Independent2009). In 1971 Dubai and five surrounding sheikhdoms (Abu Dhabi, Al Fujayrah, Ajman, Umm al Qaywayn and Sharjah) agreed on a federal constitution and became The United Arab Emirates or UAE. In February 1972 a seventh Sheikhdom, Ras al Khaymah joined the UAE. At this point Sheikh Zayid Ibn Sultan Al Nuhayyan of Abu Dhabi became the first president of the UAE. The ruler of Dubai, Sheikh Rashid ibn Said Al Maktum was named vice president, and his eldest son, Sheikh Maktum ibn Rash id Al Maktum, the prince of Dubai, became prime minister. In 1990 Sheikh Maktum succeeded his father as ruler of Dubai and as vice president and prime minister of the UAE (Library of Congress2007). It was around 1971, as the British were leaving that oil was first discovered. However to say that Dubai relied on oil for its growth would be wrong. Dubai had very little oil relative to its neighbouring emirate Abu Dhabi. So Sheikh Maktum had to diversify. He used oil revenues to create something he thought sustainable. Israel used to boast it made the desert bloom; Sheikh Maktum resolved to make the desert boom (The Independent 2009). It became a hub for tourism and financial services, Attracting capital and expertise from all over the globe. He invited the world to come tax free, and people came in their millions. A city seemed to descend from the heavens in thirty years. Would it be sustainable? (Source : The Independent, The Dark side of Dubai, 7 April 2009) (Source: Country Profile : UAE. Library of Congress Federal Research division, July 2007) 1.3: From Boom to bust over night. I arrived in Dubai in 2007 at a point when it was said that a third of the worlds construction equipment was in Dubai. It was the second fastest growing city in the world (second to Moscow) and appeared to be one big construction site. Skyscrapers were appearing over night to cater for increases in demand in property. However, a large part of this demand for property was merely speculatory. Investments in property appeared to be highly attractive and beneficial, especially to foreign investors earning in non dollar currencies. I say this because the dirham is pegged to the dollar (3.75 dhms per US Dollar). It was around late 2007 early 2008 that the dollar reached its weakest point making property in Dubai cheaper to people earning pounds for example. People also assumed that the dollar would one day appreciate; therefore giving investors that extra incentive. Dubais popularity was rapidly increasing and it was booming in the true definition of the word. However in September of 2008 things changed. See the following line graph of average residential sales prices to appreciate the extent of the crash. Figure 1 Residential sale prices (AED/ft2) Source: Landmark Advisory Board 2010. As you can see in Q408 both the average price of apartments and villas plummet from a mutual peak of 1500 AED/ft2 to around 900 AED/ft2 from one month to the next. This is a massive average decrease of 40 percent. I will attempt to demonstrate why this rapid increase in residential prices occurred and its subsequent decline and decide whether the boom and bust can be considered a bubble bursting in its true economic definition. Literature Review The Economic Theory and History behind Bubbles 2.1 An introduction to bubbles Essentially an economic bubble is an increase in the price of an asset or stock above its fundamental value and its subsequent decrease in value and implosion on the bubble is referred to as a burst. When asset prices increase speculators are overwhelmed by a sense of euphoria, chasing short term capital gains. A phenomenon that former chairman of the federal reserve Alan Greenspan memorably called irrational exuberance (Nial Ferguson, The Ascent of Money). Contrarily, when speculators primitive instincts turn from greed to fear, the bubble created by the initial irrational exuberance can burst with astonishing abruptness; almost overnight. Charles Kindleberger defined a bubble as a sharp rise in price of an asset or a range of assets in a continuous process, with the initial rise generating expectations of further rises and attracting new buyers generally speculators interested in profits from trading in the asset rather than its use or earning capacity. The rise is usually followed by a reversal of expectations and a sharp decline in price often resulting in financial crises (Bubble, Bubble, Wheres the Housing Bubble?) The initial boost in augmentation of the economy acts as a catalyst for both lenders and investors optimism about the future and asset prices rise swiftly. Nial ferguson refers to investors as an electronic herd, happily grazing on positive returns one moment, then stampeding for the farmyard gate the next (Nial Ferguson, 2008, 2009). 2.2 Bubbles in History The big ten economic bubbles (Charles P Kindleberger, Robert Z Aliber 2005) 1. The Dutch Tulip Bulb Bubble 1636 2. The South Sea Bubble 1720 3. The Mississippi bubble 1720 4. The late 1920s US stock price Bubble 1927-29 5. The increase in bank loans to Mexico and other developing countries in the 1970s 6. The bubble in real estate and stocks in Finland, Norway and Sweden 7. The bubble in real estate and stocks in Thailand, Malaysia, Indonesia and several other Asian countries 1992-97 8. The bubble in real estate and stocks in Thailand, Malaysia, Indonesia and several other Asian countries 1992-97 9. The increase in foreign investment in Mexico 1990-93 10. The Bubble in over the counter stocks in the United States 1995-2000. Also known as the .com bubble Over and over again asset, security and stock prices have reached unsustainable highs and subsequently come crashing down. From boom to bust, this process is consistently associated with ruthless insiders exploiting asymmetries of information attempting to make a profit at the cost of first time investors. In Dubai, every three months or so Emaar one of the big real estate developers (of which it is alleged that the absolute ruler of Dubai, Sheikh Mohammed has a thirty percent stake) released property for sale at increasing prices, almost instigating the bubble themselves very similar to what John Law (a convicted murderer and gambling addict) did with shares of the joint stock company named Company of the West (Compagnie dOccident) which resulted in the Mississippi bubble of 1720(Nial Ferguson, 2008, 2009). All these bubbles in History have followed similar paths; Nial Ferguson believes it possible to dissect all bubbles into five stages. 2.3 Nial Fergusons Five Stage Model (Nial Ferguson, 2008, 2009) 1. Displacement: An incident or innovation in the economy that generates new and lucrative possibilities for investors/speculators. Kindleberger refers to this as the expansion stage of the business cycle (Charles P Kindleberger, 2005). In the cases of the Dutch Tulip Bulb, The South Sea and Mississippi Bubbles this displacement was the creation of the Joint Stock Company. In the case of the US .com bubble the displacement or expansion was innovations in technology like the internet. In Dubai It could be argued that the displacement stage of the bubble was when developments were open for sale to foreign investors as opposed to previously when only locals could purchase land and property. This initial process causes a rise in spending which leads to inflated prices and increased consumption which combined translate to economic growth. 2. Euphoria/overtrading: Rising expected profits induce the appreciation in value of assets and shares. Investment soars because credit is in abundance. In Japan in the eighties Japanese investors had access to mountains of credit made available by nave bankers that didnt even contemplate a crash and the Japanese went on an investment spree. In the US in the 1990s, during the time preceding the crash .dom companies had access to almost infinite funds from venture capitalists with distorted perceptions of the future profitability of these firms (Charles P Kindleberger and Robert Z Alibir). Dubai was the same pre crash credit was very accessible; I will asses this further in my analysis segment of the dissertation. 3. Mania/bubble: The anticipation of rapid, easy capital gains entices first time investors and unscrupulous, esoteric brokers cater for this demand, in a ruthless attempt to sell assets and shares before a crash, which a seasoned broker is capable of predicting. 4. Distress: Insiders become aware that prices of assets and shares exceed their fundamental values and exploit the asymmetries of information by selling at profit. 5. Revulsion/discredit: prices begin to plummet and the electronic herd stampedes to exit the market causing the bubble to implode. The value of commodities bonds, stocks, land, buildings and houses decline to levels that are 30 to 40 percent below peak prices (Charles p kindleberger and Robert Z . Aliber, 2008, 2009), this adheres perfectly to residential duelling prices in Dubai (refer to figure 1). (Nial Ferguson, 2008, 2009). The Fundamentals behind this model are asymmetric information, availability to rapid, relatively cheap credit and the capability of capital to flow freely over geographical borders. This five stage model is accurate but basic. I will now progress to more specific models in detail behind the creation and existence of economic bubbles. 2.4 The Hyman Minsky model of instability in the supply of credit. This model created by Hyman Minsky can be used to explain financial fragility in economies. Minsky focuses on changes in the availability of credit. During periods of growth the supply of credit increases and during economic slowdowns this supply decreases. In times of growth, usually following an economic displacement like mentioned in Nial Fergusons model, investors feel more confident about the profitability of a number of investments and seek to finance these investments with credit. In the meantime, lenders become more enthusiastic about providing credit, even for investments, that prior to the expansion, had appeared too risky they become far less risk averse, reducing minimum down payments, minimum margin requirements. For individual lenders the cost of borrowing has to remain competitive too to maintain market share. However, when the mood changes, the economy slows down and fear kicks in, investors act much more cautiously. Lenders react similarly and their risk averseness increases and they supply less credit. Minsky believed that these cyclical changes in the availability of credit are a major catalyst to financial instability and are a factor in causing bubbles (Charles p kindleberger and Robert Z . Aliber, 2008, 2009). I am certain that minskys model was apparent in Dubai and definitely a defining factor of the recent burst. I will go on to prove this in the critical analysis part of the dissertation. Minsky also mentions an over-estimate of prospective returns, or excessive leverage (Charles p kindleberger and Robert Z . Aliber, 2008, 2009) during the euphoric period. Speculation suggests the acquisition of assets for the capital gain from expected surges in their value as opposed to income generated by one of these assets or for their use. The income generated by an asset or the use of an asset is considered to be the fundamental value of an asset and in bubbles the prices of assets fluctuate far from their fundamental values. This point is made clearer in the next part of the literature review. Minsky also states that a sense of euphoria or depression in one country maybe contagious in another country. I believe that the recent housing bubble in the United States and its subsequent burst influenced the real estate bubble in Dubai and was a significant cause of the crash. 2.5 Fundamental Value Researchers seem to concentrate on one of the following elements when considering a bubble: rapid appreciation of assets, overly optimistic predictions of future prices, a discrepancy between price and fundamental value and obviously a vast depreciation of assets when the bubble pops (Margaret Hwang Smith and Gary Smith, 2006). Karl Case and Robert Shiller believe that A tendency to view housing as an investment is a defining characteristic of a housing bubble (Margaret Hwang Smith and Gary Smith, 2006). However, Margaret Hwang Smith and Gary Smith, in their 2006 journal titled Housing, Housing, where is the housing bubble? disagree. They argue that housing can be considered a legitimate investment and that the best way to spot a bubble is to determine the discrepancy between the actual prices of houses and the fundamental value of these houses. Speculators in general do not make an attempt to calculate the underlying value of a house, they respond to expected capital gains. Margaret Hwang Smith and Gary Smith define a bubble as a scenario where the equilibrium price of an asset is higher than the present value of the anticipated cash flow from the asset (Margaret Hwang Smith and Gary Smith, 2006). Nonetheless, fundamental values may rise rapidly (for example an increase in population and therefore an incre ase in the acquisitions of houses for their use as opposed to expected capital gains, or an increase in rent) may stimulate a legitimate increase in the prices of houses. Equilibrium house prices may also increase rapidly and not necessarily be considered a bubble if their actual price is lower than their underlying fundamental value. They state that the real defining characteristic of a bubble is when equilibrium market prices cannot be answered for by the assets anticipated cash flow. Case and Shiller refer to the real estate market as being populated by amateurs making infrequent transactions on the basis of limited information and with little or no experience in gauging the fundamental value of the properties they are buying and selling'(Margaret Hwang Smith and Gary Smith, 2006). If this is true and I believe it was, in Dubai, to a certain extent (through knowing investors on a personal level) how can one expect for fundamental values to equal market prices? Most agents within the real estate market i.e. brokers, buyers and sellers seem to use what is known as comps when dealing within the real estate market. Comps are the latest sale prices of homes with similar specifications within the same area. Comps tell us how much other individuals are prepared to pay but not whether these prices are justified by the fundamental value (Margaret Hwang Smith and Gary Smith, 2006). Attempting to demonstrate whether market prices differ from fundamental prices isnt easy. Figures for average real estate prices are infamously imperfect. This is mainly due to the fact that houses are not homogenous in their specifications and environments. However, the National City Corporation use a multiple regression which considers a ratio of house prices to household income in a given area to mortgage rates, population density, the ratio of household income in the given area to the national average and historical prices to determine how much actual prices deviate from their real values (Margaret Hwang Smith and Gary Smith, 2006). The reason a ratio of house price and household income is used is based on theory by Karl case and Shiller that argue that housing prices are a bubble waiting to pop if the average investor is priced out of the market'(Margaret Hwang Smith and Gary Smith, 2006). There are problems with this model e.g. the historic house prices may not be based on fundamental value. Some economists including Edward Leamer argue that if house prices have increased in a larger proportion than rents a bubble exists (Margaret Hwang Smith and Gary Smith, 2006). I will attempt to look at rents versus house prices in my critical analysis section of the dissertation to determine whether this was apparent in Dubai. I will also attempt to look at the population density because I believe that it is relevant to fundamental value because an increase in population causes an increase in the demand for residential properties that will be used as dwellings. Minsky stated that a fundamental value of an asset was to do with is use and the income (rent) generated from the asset. 2.6 A brief look at the recent financial crisis in the USA. Hyman minsky stated in his interpretation of a bubble that euphoria or depression in one country can be contagious and spill over into another. I believe that the bursting of the real estate bubble in the states and the subsequent lack of worldwide credit was highly influential in the bursting of Dubais housing bubble. As per usual the great real estate and leverage bubble in the US of 2007 was instigated by a pervasive macroeconomic displacement. Prior to the 2000s banks would give loans to home owners and keep those loans as assets in their books (Burton G. Malkiel, 2010). However, post 2000 the entire banking system changed. Banks carried on issuing loans for mortgages but instead of holding them as assets on their books they would keep them for a short period of time and then sell them on to investment banks who would bundle different loans with different credit ratings into mortgage backed securities, also known as collateralized debt obligations (Burton G. Malkiel, 2010). Loans are split into different risk classes or tranches. So, low risk loans and high risk loans are bundled together and sold as one financial product which was deemed a good investment. This caused deterioration in lending standards (Burton G. Malkiel, 2010). Employees in charge of originating loans to clients were reckless when assessing the risk of the individuals potential default especially when dealing with subprime mortgages because they knew that the bank was only going to hold these loans for a short period of time and then pass them on. Insurance companies were also insuring subprime loans with credit default swaps because they were too nave to foresee mass defaults. These innovations in the banking system made credit easily accessible to individuals who may have not been considered credit worthy before these changes (subprime). Many financial institutions held vast amounts of these new bundled securities based around mortgages and held less equity backed securities and increased their leverage ratios (Burton G. Malkiel, 2010) making them very vulnerable in the case of a crash. Highly accessible credit at attractive rates due to lowered lending standards led to a huge bubble in the prices of houses. The inflation adjusted price of a commonplace home was roughly identical in 1999 as it was in 1899; however, between 2000 and 2006 real home prices doubled (Burton G. Malkiel, 2010). This is portrayed in the following line graph based on data from the Case-Shiller home price index in the US. Figure 2 Case-Shiller Home price index, 1989 = 100. Source: (Burton G. Malkiel, 2010) As you can see from the graph there is a rapid ascent in prices from around 2000 followed by a quick fall in prices starting in 2007. Prices began to decline and euphoria turned to fear. Houses were worth less than the amount of money owed to the banks and individuals began to default in mass. With massive amounts of defaults occurring, the value of the bundled mortgage backed securities or collaterized debt obligations (cdos) decreased rapidly. Many highly leveraged financial institutions holding long term assets financed by the short term mortgage backed securities did not have sufficient liquidity to continue to function (Burton G. Malkiel, 2010). All credit markets were frozen, excluding the US Treasury securities markets and financial institutions did not have sufficient liquidity to cover their short term debts. In the case of a bank an example of a short term debt is a deposit and people began to fear for their deposits and runs on banks happened in the US and UK institutions with vast amount of money invested in the US housing market e.g. Northern Rock. The US government was forced to bail out a number of financial institutions to prevent a total financial collapse (Burton G. Malkiel, 2010). Banks all over the world became cautious about lending money. Amlak finance Dubai stopped lending money all together and I think this was significant in the bursting of the bubble; it ties in directly with Minskys model of cyclical changes in the supply of credit. Panic struck and a worldwide financial crisis ensued. 3 Critical Analysis In this section of my dissertation I will evaluate real life data and literature about the situation in Dubai. What caused the rapid increase in price in the housing market? and what caused the resultant rapid decline in prices. 3.1 Displacement. Economists appear to agree that every bubble starts with a displacement. A macroeconomic change, or innovation, that induces pervasive adjustments in how agents within the economy behave and perceive the future. It can also be considered a paradigm shift. In the case of the .com bubble the displacement was the availability of the interweb to mass users. In the case of the recent housing and leverage bubble of the US the displacement was innovations in the banking system and the creation of new bundled financial products and collaterized debt obligations. In Dubai I believe that there were three displacing factors: The first displacing factor occurred in May 2002. Dubai was never rich in oil like its neighbouring emirate Abu Dhabi so it focused on creating a hub for tourism and commerce. It also promoted the development of real estate. In 1997 publicly quoted Emaar Properties and Al Nakheel Properties were setup (http://realestate.theemiratesnetwork.com/articles/freehold_property.php). In 1998 emaar started developing the Dubai Marina and the Emirates Living Community; however, properties within these developments were released on leasehold contracts which mean that properties are leased out for ninety years as opposed to being owned freehold. These developments were not successful in the market. People were sceptical about the leasehold contracts. Things changed in May 2002 when the crown prince General Sheikh Mohammed bin Rashid Al Maktum implemented a new law, stating that ex pats were able to buy property in certain areas of Dubai. The following graph shows all transactions from 1994. The graph is based on data from REIDIN.com a company that provides data and information covering all deals and transactions in Dubai since 1973. The company is an exclusive partner of the Dubai Land Department the real estate registry for the emirate. (REIDIN, DUBAI FOCUS, 2010) Figure 3 Quantity of transactions in Dubai from 1994 (Reidin.com, DubaiFocus, 2010) The graph shows that as of the changes in law about the ownership of real estate from 2002 there is not a significant increase in the quantity of transactions. In fact, there is a decline in transactions until 2005 when quantity of transactions increase rapidly from there onwards. I would still, however, consider the innovations in the legislation behind the ownership of property a displacement because without the changes, ex pats would never have been able to own property on a freehold basis and the bubble would never have happened. I say this because the vast majority of investments into the property market have come from expatriate sources. See the following chart which depicts the value of transactions by nationality. Figure 4 Value (AED) of property transactions by nationality from 1973 (Reidin.com, DubaiFocus, 2010) As you can see from the chart foreign investment is very significant in value and this could never have happened if the changes in legislation had not been made. Also, cross border transactions are a key in the creation of a bubble and as you can see from figure 4 cross border transactions are huge. Another displacing factor was hype generated by the media about talks of a new GCC currency called the Khaleeji. Talks were being had about the possibility of the UAE, Saudi Arabia, Oman, Qatar, Kuwait and Bahrain creating a new currency for their states. These talks were being had around 2006/2007 and nothing was ever finalised but if it was to happen, especially at a point in time when the dollar was weak, this new currency would be valued higher than the specific currencies of the gulf states and investments in these countries would appear even more attractive to speculators as they would rise in value from the creation of a new currency. This ties in with the next displacing factor which is the weakness of the dollar due to financial fragility in the US. In the Spring of 2006 the dollar weakened dramatically due to financial instability in the US. Towards the end of 2006 it looked as if the exchange rate was rising towards $2. In April 2007 the Dollar depreciated to over $2 and on the 27th of July 2007 it got to $2.06 the weakest it has been since 1981, it continued to fluctuate around $2 for the next five months and on the 9th of November 2007 it was $2.11. After this point, on average, the pound began to decline in value as the global recession hit the UK. The importance of this analysis about the dollar exchange rate is that it shows that from around 2006 until 2008 the dollar was relatively weak compared to the pound. Transactions for Real Estate were booming during this period as portrayed in figure 3 and a huge portion of these transactions were fuelled by investment from the United Kingdom as portrayed in figure 4. I therefore believe that the weak dollar was statistically significant in the increase of transactions from UK investors. The exchange rate of the Dollar versus the Indian Rupee shows a similar story. From around January 2007 the dollar declines in value against the rupee to a peak of around 39 rupee to the dollar. Compare this to a value of around 55 rupee in 2003. Again the weakness of the dollar compared to the Indian rupee can be argued to have catalysed vast investment from Indian investors from 2006 as the dollar was depreciating until late 2008 when the global crisis begun to have consequences on other nations e.g. India and the UK. I therefore consider this a displacement which lead to increases in transactions, increases in prices of property and overly optimistic expected prices. Refer to graphs of the dollar exchange rates versus the pound and rupee in the appendix section of the dissertation. 3.2 Euphoria/overtrading If you refer back to Nial Fergusons five stage bubble model you will see that after a pervasive macroeconomic displacement in the economy, if it is tending towards a bubble situation, an economy will experience euphoria, also referred to as overtrading. Rising expected profits induce the appreciation in value of assets and shares. Investment soars because credit is in abundance. If you refer back to figure 1 you will see that prices begin to rise steadily from 2005/2006. The number of transactions also increases rapidly from around the same period. Nial Ferguson also talks about the abundance of credit; this too ties in with minskys model of the pro cyclical supply of credit. It implies that many of these transactions were fuelled by credit or leveraged. Again this is similar to what was happening in the US before their crash. The following line graph shows the percentage of residential transactions fuelled by credit or leveraged. I have also included the percentage of residential transactions that are classed as other. I have put other transaction types into the equation because a substantial amount of transactions are classed as other. other refers to transactions that are none of the following transaction types: sale, mortgage, leasing, valuation, grant, rent, compensation and pre-registration. Im not entirely sure as to what types of transaction would be considered as other. This, I will consider a limitation in my data; however, this is data provided by a governmental entity and censorship is alive and well in Dubai. Figure 5 Percentage of residential transactions leveraged with credit. What figure 5 shows is a steady increase in the percentage of transactions fuelled by credit until 2006 when there is a vast decline in this percentage and a continuous decrease until 2009. I wonder if the global credit crunch caused by the US crash hit Dubai much earlier than people thought, however why did prices not stop falling until late 2008/2009?. There is a visible pattern here; as transactions leveraged by mortgages decreases, transactions classed by Dubai Land Department the real estate registry for the emirate as other increase. This appears to be rather dubious in my opinion; maybe the global credit crunch hit Dubai but in an attempt to maintain high prices until ruthless inside investors with asymmetries of information could leave the market with huge profits the quantity of transactions was kept high by the government, who have invested interests. Emaar Properties and Al Nakheel Properties are publicly quoted companies but ownership is predominately by wealthy governme ntal authorities. We all know that OPEC controls the supply of oil to maintain high prices; maybe something similar happened with property in Dubai. Nial Ferguson does mention ruthless inside investors have played a significant role in past bubbles; I think this could be apparent here. (Nial Ferguson, 2008, 2009). The graph shows that vast amounts of credit were used to leverage investments until 2006 when the amount declines rapidly. Probably because banks were influenced by the credit crunch in the US and feared they may have inadequate liquidity. I will analyse the pro cyclical supply of credit in a later section of my dissertation. 3.3 Mania/Bubble and distress Nial Ferguson refers to the next the next stage as mania or bubble, where first time investors are enticed to the market and seasoned investors who can predict a crash scramble to sell their investments at a profit before the crash. If you refer back to figure 3 that shows the quantity of transactions I would say that the mania/bubble stage was occurring from 2007 to 2008 at when the quantity of transactions are skyrocketing. At this point too, prices are still very high (refer back to figure 1). The closer to late 2008 the sillier the investment, as bubble bursts in october 2008. Therefore transactions around about this time have to be from first time investors who cannot see a crash. This is referred to by Nial ferguson as the distress period. 3.4 Revulsion/discredit Prices begin to plummet and the herd stampedes to exit the market causing the bubble to implode. This is apparent in late 2008 and 2009. Transactions stay high (Figure 3) but prices are declining rapidly (40 percent on average). So, investors are struck by fear and rush to sell properties even if it is done at significant los

Ethnography - Inter-team Conflict with the Coach :: Ethnography

Ethnography - Inter-team Conflict with the Coach Recently, two strong sophomore players quit the varsity women’s water polo team. They said that they were no longer having fun, one saying that the time commitment â€Å"just was not worth it anymore,† while the other said that playing polo at Oxy was making her more and more unhappy.† Earlier in the season, one of the players who was named first team All American and MVP of the National Tournament, also almost quit the team for good. Again, her reasoning was that the game was not fun for her anymore. She also expressed that she felt unappreciated by the coach for her efforts at Nationals, as well as for her leadership on the team on a regular basis. These withdrawals reminded me of the last two years when I was on the team. I recall how often I would hear the other players express their discontent about being on the team. However, the problem did not lie in the team in itself, but rather in the coach and his ways. Interestingly, although I was a member of the team, I truly was not aware of the problem at hand. I, above and beyond, was a novice player and almost never received anything but positive encouragement from the coach. It is important to realize that I had never played, or even seen, the game of water polo before coming to Oxy, and therefore learned a lot by coming to practice and watching and learning from the reminders and criticism that the coach would give. Nevertheless, I did have a lot of experience swimming under various coaches—some of whom where the meanest of the mean. It is for this reason that I felt that the other players were often being overly sensitive to the criticisms (which I viewed more often than not as constructive) that the coach would give. Of course, there would betimes that I felt that he would pick on (or yell more at) certain players. But I believe that there are few coaches that specifically try to bring down moral and cause players to hate the game. Yet, despite the fact that the coach may not mean to bring down moral and cause players to hate the game, it seems he has done something to cause two, almost three, players that played in the National Championship tournament to quit the team.

How Does Social Media Affect Society Essay

Social media has taken a big toll on our everyday lives. Social networking sites like Facebook, Instagram, and Snapchat allow you to connect with just about anyone. According to Cornell University’s Steven Strogatz, social media sites can make it more difficult for us to distinguish between the meaningful relationships we foster in the real world, and the numerous casual relationships formed through social media. Social media has become an unquestionable part of our everyday lives. According to Booth, studies have shown that people actually are becoming more social and more interactive with others, but the style of that communication has changed so that we’re not meeting face-to-face as often as we used to and he also says, â€Å"We’d rather email than meet, and we’d rather text than talk on the phone. â€Å"Hearing from our friends and family makes us feel important and loved†¦. We don’t want to be the last to know about some important, or even trivial, event of interest,† says Dr. Joanne Cantor. And our gadgets help quell that insatiable curiosity that we’ve had since we were babies. Social media isn’t always negative. It can help build self-esteem such as when you post a picture on Instagram or Facebook and you see comments saying, â€Å"You’re beautiful† or â€Å"that’s a pretty picture.’’ Negative Effects of Social Media Teenagers are negatively impacted by social media view by the way they show their personal image and beauty standards. The sizes of celebrities often influence teens. Magazine advertisements also encourage teens to think they have to look a certain way to be considered beautiful or handsome. Teens should be taught to value their own talents and beauties. TV and movie programs encourage characters to use drugs, alcohol, and violence. The satisfaction and successfulness of drugs, alcohol, and violence are making it hard for teenagers to make responsible decisions. It is up to the parents to teach their teens about the negative consequences  that come with risky behavior activity. Being on to much social media can lead to addiction and take away time to do other tasks. Secondly, kids can see images on social media that encourage violence and sexual activity. Another negative affect of the social media is that users shares too much information which can pose a threat to them. Even with the heavy security settings your personal information may spill out on the social sites. Posting your videos or pictures and copying your status is an easy task and can be done within few clicks.

How does Shakespeare adapt the holinshed chronicles to create an entertaining piece of theatre? Essay

The Holinshed Chronicles, first published in 1577, contained factual accounts of the reign of Macbeth, and was used as the source material for Shakespeare’s play ‘Macbeth’. During this essay, how Shakespeare used, edited and manipulated this information will be analysed. There are several reasons why Macbeth was a good choice for Shakespeare to base a play on. Firstly, Banquo, a character in ‘Macbeth’, was related to the current King of England and Scotland, James I, so if Shakespeare portrayed Banquo as a good person, his play would gain instant popularity with the royal family. Another reason Shakespeare was drawn to Macbeth was because the factual story of Macbeth included the predictions of three strange women, or witches, and as people in the early 17th century took witchcraft very seriously, it added extra tension for the audience, and once again suited the interests of James I, who had a well known interest in witchcraft. It was typical for Shakespeare’s plays to derive from other people’s work, for example, ‘Macbeth’ was taken from the Holinshed Chronicles. Another example of this is the play ‘Romeo and Juliet’, which was taken from an Italian poem, and turned into a play by Shakespeare. When creating ‘Macbeth’, Shakespeare’s main aims were for his play to be popular with the Royal Family, and therefore popular with the general public, which meant that he would make a lot of money from the production. It was also important that the play wasn’t too long, and was easy to perform on stage. Shakespeare included three witches from the beginning of ‘Macbeth’ to incorporate Macbeth into the central role of the play straight away. According to Holinshed, there were not only witches, but also â€Å"certeine wizzards† who prophesied about Macbeth. Rather than include too many ‘supernatural’ characters and complicate the performances on stage, Shakespeare created Hecate, a very powerful witch to make up for lack of witches and wizards from the Holinshed Chronicles. From their first appearance, the witches are in full control of what happens around them, â€Å"When shall we three meet again?† And where and how they appear. This is crucial to the play, as it gets the interest of the audience from the very first scene, because at the time when the play was first produced, there was a very strong belief about witches and the supernatural. Shakespeare is very creative with the way he uses the witches to incorporate the audience into the play. The witches often equivocate when talking to Macbeth, misleading and confusing him, â€Å"The power of man, for none of woman born shall harm Macbeth.† This technique is also effective when used to create dramatic irony, for example when it is used at the beginning of the play, â€Å"All hail Macbeth, that shalt be king hereafter.† Shakespeare clearly highlighted the witches power throughout the play by using the various aforementioned techniques throughout the play. The witches language also helped for them to be taken seriously by the Shakespearean crowd, because they talked in iambic pentameter, and the people watching the play most probably wouldn’t speak like that, so it helped to give the witches an extra ‘edge’ in the performance. The inclusion of the witches in the play was of up most importance, and was most probably a factor in Shakespeare’s decision to use the story of Macbeth for his play. It must also be taken into account that the play wasn’t being performed with any effects, just a stage, so it was crucial that Shakespeare made the scenes possible to perform, (Shakespeare’s plays were never meant to be read) whilst still using some form of stagecraft. A good example of this is from the â€Å"witches dance† scene. This would have looked good on stage, but it was equally simple to perform, with no additional effects required. In ‘Macbeth’, Shakespeare portrays Duncan as a good ruler, who is well respected and liked. This conflicts with the Holinshed Chronicles, which suggest that Duncan was a terrible leader with little support or respect. Even though Shakespeare uses the Chronicles as the main source for his play, he mixes factual information with fiction, to make the play more appealing and exciting. Duncan first appears in the play in battle, and seems like a commanding character in control of his actions, but is later revealed to make errors in judgement, â€Å"He [the traitor] was a gentleman on whom I built an absolute trust.† His judgemental errors show again when he admires Macbeth’s castle, â€Å"This castle hath a pleasant seat† which will ultimately be the place of his murder. Despite this, Shakespeare again portrays him as a good king, as this is the main reason that Macbeth has doubts over his murder. One of the main reasons Shakespeare wanted to portray Duncan as a good king was to make the murder of him more dramatic. If he had portrayed Duncan as a bad monarch whom people disliked, his murder wouldn’t have been such a terrible act, and Macbeth would have faced little consequences. Instead, we are given an opportunity to see Macbeth rise to his zenith and quickly fall to his nadir shortly after in the play. Another reason for the murder of a ‘good’ Duncan was to grab the attention of an audience that were watching the play at a time when there was a great belief in the Divine Right of Kings. It is widely believed that Shakespeare changed Duncan’s character in a similar way to the other characters he portrayed differently than Holinshed – to cater to James I, the current King of England and Scotland. Throughout ‘Macbeth’, Banquo is seen as the opposite of Macbeth, where as in the Holinshed Chronicles, it’s written that Banquo was as eager as Macbeth, and willing to support him throughout his plots and kingship. We first see Banquo at the beginning of the play, with Macbeth when they meet the witches, who tell the prophecies about Macbeth. Whilst Macbeth is thinking about the prophecies and plotting his next move, Banquo shows doubts, â€Å"Are ye fantastical, or that indeed which outwardly ye show?† This highlights the contrast between Macbeth and Banquo from the beginning of the play. As the play advances, we see the relationship between the two put under great strain, as Banquo is the only person who knows about Macbeth’s plots and murder of the king, â€Å"I fear thou played’st most foully for’t.† Despite this, Banquo still pledges his loyalty to the new king, but is however murdered anyway due to the paranoia of Macbeth, and the seriousness in which Macbeth takes the witches predictions of Banquo’s children becoming king. There were several reasons why Shakespeare would have wanted to do this to Banquo’s character in ‘Macbeth’. Firstly, it highlighted the contrast between Macbeth, and his once close friend. It also highlighted Macbeth’s paranoia over the predictions of the witches, so much so that he was driven to murder his close friend to keep his throne. It is also another adaptation of Shakespeare’s that emphasises how he tried to adapt the play to suit the current king of England and Scotland, James I. At the time of writing it was believed that the king was a descendent of Banquo, so Shakespeare would have wanted to portray him as a good character, therefore gaining the approval of the Royal Family and making the play instantly popular. Macduff, a crucial character in the plot of ‘Macbeth’, is only first seen in the middle of Act 2, and plays a rather scarce role in the play. However, this does not reduce the significance that he has on the plot of the play. Macduff is suspicious of Macbeth as soon as he takes the throne, and suspects that he killed Duncan. Macduff’s suspicions of Macbeth are key to the plot, as it is he who flees to England to build an army capable of challenging Macbeth when he hears that his family have been murdered by Macbeth, â€Å"Within my sword’s length set him. If he scape, heaven forgive him too.† This is another example of a character being the friend of Macbeth at the start of the play, and turning against him as the play progresses. â€Å"Bring thou this fiend of Scotland and myself†. In productions of ‘Macbeth’, Macduff’s main scene’s, such as his campaign in England and final battle with Macbeth, are hard to produce on stage. This has resulted in many productions cutting his scene in England, and Shakespeare changing the location of Macbeth’s final battle. According to Holinshed, when Macbeth finds out about Macduff being born by Caesarean section, â€Å"Macduff was from his mother’s womb untimely ripped.† he flees, and is pursued by Macduff. However, in the play, Macbeth and Macduff fight at Dunsinane and Macbeth is ultimately slain. This is an example of how stagecraft was a major hurdle in Shakespeare’s productions, and how they were written. Shakespeare based Lady Macbeth on a person from Holinshed, Queen Gruoch of Scotland, however, he strongly exaggerates and changes the character to suit her role in the play. Lady Macbeth plays a key role in the plot of the play from the first time we see her, at the end of Act 1. Without Lady Macbeth, it is very probable that the play’s plot wouldn’t be able to exist, as it is Lady Macbeth who fuels Macbeth’s ambitions throughout the play. She is constantly twisting the thoughts of Macbeth and propelling him to do the awful things that he does throughout. In Lady Macbeth’s first appearance, when she hears of the witches predictions she calls on evil spirits to assist her in her plans for Duncan’s murder, â€Å"Come, you spirits that tend on mortal thoughts, unsex me here and fill me from the crown to the toe topfull of direst cruelty.† As the play progresses, we see Lady Macbeth overpower the will and thoughts of Macbeth, for example, when she proposes the murder of Duncan, Macbeth goes back on his word, saying that he wants nothing to do with the murder. At the end of that same scene, however, Lady Macbeth has managed to manipulate his thoughts, and get him to go through with the murder, â€Å"I have given suck and know how tender ’tis to love the babe that milks me: I would, while it was smiling in my face, have plucked my nipple from his boneless gums and dashed the brains out, had I so sworn as you have done to this.† Even though it’s Lady Macbeth who is in control of events in the play, she too suffers great anxiety after all the terrible things she does. By the end of Act 3, there are signs of her conscious taking over her, with her taking no part in the murder of Macduff’s family, a major plot in Act 4, an act in which she doesn’t feature at all. By the beginning of Act 5, Lady Macbeth starts to sleepwalk, and give away everything that her and Macbeth have plotted and done, â€Å"The Thane of Fife had a wife. Where is she now? What, will these hands ne’er be clean?† This adds dramatic effect to the end of a scene to keep the audience interested in the play, and offers a different perspective on a strong looking character. Macbeth is the main character of the play, and is probably the most interesting character to analyse. We first see Macbeth in the first half of Act 1, where he is a military hero, with no real ambition but to do the best he can for his country. Throughout ‘Macbeth’, we see him manipulated by his wife and murder his way to kingship, sometimes against his will, but other times, such as when Macduff’s family are murdered, there is no mention of outside influence. Although it seems like it is Lady Macbeth who is in command of what happens to potential threats and Macbeth, she never actually commits any of the murders herself. This could suggest that she knew what consequences could come from the beginning, and wanted it to be on Macbeth’s shoulders, not hers, however, she also suffers from mental illness due to the murders later on in the play. During his transition from hero to hated villain, we see how much Macbeth is plagued by his conscience and the knowledge that what he is doing is wrong, â€Å"We will proceed no further in this business, he hath honoured me of late.† There are two factors that prevent his conscience from taking command however, the witches and Lady Macbeth, both of whom he can’t ignore. As the play progresses, Macbeth struggles to trust anyone, even his wife, who he earlier said was his â€Å"dearest partner of greatness†. This leads to the murder of a lot of people that Macbeth doesn’t trust, including Banquo, who was his good friend, and ally for a short period of time. Although he is easily manipulated, he can also manipulate other people, depending on who he’s around, for example, when talking to royalty, or important people, Macbeth could talk in verse, or iambic pentameter. He also had the ability to talk well to â€Å"low-status characters†, such as the Porter or the Murderers, speaking in prose. We also see a different side to Macbeth during his soliloquies, as we see what he is thinking at crucial parts of the play. For example, in Act 5, Scene 5, when he performs his famous â€Å"Tomorrow† soliloquy, we see an insight into his emotions and feelings about how he feels he has lost his friends and family. Shakespeare’s use of the soliloquies of Macbeth throughout the play creates a unique opportunity for the audience to see a glimpse of what Macbeth is thinking and feeling, creating a better audience response throughout, and maybe giving the audience a chance to feel sorry for Macbeth, before he dies honourably in battle. There are many different techniques that are used throughout the play, and a lot of language in different styles and formats. It is crucial to remember that Shakespeare’s plays were written in the 16th Century for the 16th Century, not for us to read in a book 400 years later. Shakespeare uses lots of imagery in his plays, which was crucial for an audience of that time, as the play was only performed on stage with no special effects, (apart from the occasional trap door†¦) so the use of imagery in the play allowed the audience to get a better picture on what was happening in the play. Shakespeare’s ability to use both iambic pentameter and prose makes ‘Macbeth’ stand out, because you are given a chance to see the intelligence of characters such as Macbeth, who use both iambic pentameter, â€Å"To know my deed, ’twere best not know my self† and prose, â€Å"I did so, and went further, which is now the point of second meeting.† The language that Shakespeare chooses to use is also crucial to understanding the relationships between characters, such as Macbeth and Lady Macbeth. In the early scenes, the two use iambic pentameter when talking to eachother, which shows a trust and understanding between them. However, in the later scenes, this trust is broken, and the language used in the scenes containing these characters reflects that as their consciences start to eat away at them, â€Å"Out, damned spot! Out, I say! One, two. Why then ’tis time to do’t?† Stagecraft was of up most importance when the play was performed in the 16th century (and now) as the play was never meant to be read, just performed. With limited equipment/effects, it was difficult to produce a play that was easy to perform on stage, however, Shakespeare wrote his plays in such a way that they grabbed the attention of the audience whilst being simple to perform at the same time. A particularly good example of stagecraft is the witches’ dance from the beginning of Act 4, â€Å"Double, double told and trouble; Fire burn, and cauldron bubble.† This is particularly effective, as it can be performed easily on stage, but it also grabs the attention of the audience to keep them interested. Also, because it doesn’t require any spectacular effects, it could be performed fairly easily in 16th century Britain. Because the play is limited to a number of acts/scenes, it was necessary for Shakespeare to either miss out sections mentioned in Holinshed entirely or edit them to make them more performable. A good example of this is the final battle between Macbeth and Macduff. According to the Holinshed Chronicles, Macbeth tried to flee from his castle, but got caught by Macduff and killed. In ‘Macbeth’, the whole scene takes place at the castle. This allows the scene to be performed whole on stage, so there is no loss of tension between scenes, and it makes it easier and cheaper to perform, because less sets are required and it isn’t as broken up. In reality, Macbeth’s reign over Scotland lasted 17 years before he was killed, however, this would have been inappropriate for a play of this length, so Shakespeare had to narrow his reign down to only a few months. This helped the performance, because it made it much more dramatic, creating a better audience response. Settings of the play also had to be narrowed down, due to time, cost and convenience on stage. For example, in reality, there was lots more English involvement, and Shakespeare only covers a very small scene in England. This is because the play is explained well enough without the English scene, so it was un-necessary to add more scenes which weren’t needed. After having the chance to study the play from both the book and movie, it’s clearer what limitations Shakespeare had. For example, in a film, special effects can be added, and more scenes made available in the production. On stage however, there are more limitations, for example, when Birnam Wood ‘moves’ towards Dunsinane Castle, effects can be added in a film, but on stage you are limited to basic props and no additional technology. This changes how the audience interprets the story, because you get a better idea of how it was from a movie, with more advanced editing, compared to watching it how it was probably performed originally on stage, In conclusion, there are various ways in which the Holinshed Chronicles are adapted to make an entertaining piece of theatre, but in my opinion there are a few key points. Firstly, I think that ‘Macbeth’ has been so entertaining and successful, because there was already an interesting plot and opportunity to impress the current king. Secondly, Shakespeare’s use of iambic pentameter and prose makes the language of the play very interesting and it is clever how the information in Holinshed is twisted, manipulated and made more dramatic to create a very entertaining piece of theatre.

Currency Exchange Rates, Management, and Speculation

Currency Exchange Rates, Management, and Speculation Read about the ways government and investors can manage and speculate on the value of their currencies. Currency exchange rates have become a global issue in the past year, particularly for developing economies which are generally performing better than the economies of the US, Europe, and Japan – the three sources of the â€Å"reference currencies† that essentially determine the value of the rest of the world’s money. This article is a short primer on the basics of currency exchange. It explains the ways in which governments and private investors can manage and speculate on the value of their currencies. Fixed vs. Floating Exchange Rates The value of the currency is always relative to something else, whether some commodity (gold has historically served as a reference) or other currencies. A fixed exchange rate also called a peg is a value that is determined by a government’s central bank, which must engage in the market trade of its currency for the reference currency in order to maintain the peg value. The main requirement for a fixed exchange rate scheme is that the central bank holds a large reserve of the reference currency. In a scheme in which the currency is pegged to a single reference currency, maintaining the peg is relatively straightforward. The value of the local currency is a simple function of the amount of the reference currency in the financial system, and changes in the currency value are reflected as price inflation or deflation; in order to exercise control over the local currency, the central bank sells the reference currency to move the value of the local currency higher, or purchases the reference currency to reduce the value of the local currency. Read more:  Money Makes the World Go Around A single currency peg is impractical  because the value of the reference currency always fluctuates. Let’s say that an example country – we’ll call it Examplestan – sets the value of its currency, the clam, at 5 clams to one US dollar. If a merchant in Examplestan imports $20 worth of goods from the US, he pays 100 clams. At the same time, he imports $20 worth of goods from Europe, whose euro is equal to $1.20; therefore, he only receives $16.67 worth of goods for his 100 clams. That means to earn back his 100 clams from selling the goods, he has to inflate the price by 16.65%, because the goods he bought from Europe are only worth 83.35 clams. The relative value of the clam is also affected by price inflation or deflation in the US; the actual amount of goods received for the equivalent of $20 will differ as inflation increases or decreases, which causes inflation or deflation of the clam as a follow-on effect. The opposite end of the spectrum from a fixed exchange rate is a floating exchange rate, in which market forces determine the value of the currency. The currency in a floating exchange rate system is treated as a commodity, and its value is determined by supply and demand.   There is no country that uses a fully floating exchange rate scheme, but some of the effects of what it can do to a local currency can be seen in emerging markets where large inflows of foreign investment money have driven the value of the local currency higher. The Philippines, which currently has the best-performing stocks in the world, is a good example. The high inflow of foreign money into the local stock market represents high demand for the Philippine peso – the investors are trading their dollars, euros, yen, and other currencies for equity, valued in pesos, in Philippine companies. Thus the value of the peso is growing, meaning that fewer pesos can be exchanged for one unit of a foreign currency. This is good for the economy in one respect because it makes imports cheaper, but it increases the cost of exports and tends to dampen demand for local labor and goods. Dirty Floats and Currency Hedges In order to find a â€Å"happy medium† between imposing strict control over the currency value and allowing it to seek an efficient value through market effects, most governments practice what is called a managed float, sometimes also referred to as a â€Å"dirty float†. Instead of setting a fixed exchange rate for its currency, the central bank will set a target range. Rather than fix the currency at 5 clams = $1, the central bank of Examplestan might instead choose to let the value of the clam fluctuate, so long as it does not fall outside a range of 4.50 to 5.50 clams per dollar. There is a number of advantages to maintaining a dirty float. Allowing the currency to fluctuate within a controllable range reduces the number of foreign reserves the central bank must hold, which frees up financial resources and permits the central bank to speculate on the future value of the currency to a degree by issuing bonds denominated in either the local or foreign currencies. This is a form of hedging, because the bonds lock in a future value, in the sense that the amount of a bond issue represents a known release of either the local or foreign currency in the future when the bonds reach their maturity. This is similar to the forms of hedging and speculation that private investors can engage in by treating currency as a commodity, including options contracts, forward contracts, currency swaps, and futures contracts. In the private sector, currency hedging and speculation are particularly useful for companies whose trade involves a large amount of foreign currency. For example, the trader in Examplestan may wish to purchase an option to swap a certain number of clams for US dollars at a fixed rate lower than the present exchange rate, say 5.10 clams to the dollar, if he suspects that when he completes a future purchase of US imports, the rate will be even lower than that. If when the time comes, the actual exchange rate is 5.12 clams to the dollar, he exercises the option and lowers his purchase cost by 0.1% not a lot, but for companies whose transactions are in the millions of dollars (or clams), the difference can be very significant. Naturally, foreign currency exchange rates is far more complex theme than what is described in this brief article, but to help understand its intricacies, just remember the basic point that the value of a currency is determined by its amount in a financial system compared to other currencies in the system, and that managing the values of those is really only a matter of managing quantities.