Health Law and Ehtics Assignment Example | Topics and Well Written Essays - 1750 words

Health Law and Ehtics - Assignment Example To facilitate and examine ethics in nursing and the health industry at large, this paper will concisely will discuss the deep origins of healthcare ethical healthy behavior. It also seeks to analyze some of the ethical issues in healthcare among them, refusal to care, beneficence, autonomy, non-male-ficence and justice (Lo, 2013). Ethical decision-making is crucial in the healthcare industry when it comes to addressing issues, conflicts and uncertainties concerning opposing values such as individual, organizational, professional and communal values. The ability to influence decisions on patient-care largely depends on the ethical guidelines provided. To avoid ethical dilemmas, there should be clearly spelt procedures and guidelines aimed at supporting ethical decision-making (Krueger & Stein, 2010). There are a number of significant challenges facing health care organizations among them rising public expectations, growing financial pressures, safety of patients, issues of quality improvement, mergers and consolidations, health care reform among others. These factors have placed healthcare firms under much stress and pressure. They have also intensified ethical concerns and conflicts. These challenges call for ethical decision-making by the parties involved (Curtin, 2011). Ethics is a very significant field to an organization’s mission as well as towards achieving the main goal. Health care executives and managers should demonstrate the significance of ethical standards in their own actions as well as looking for ways of integrating ethical practices within an organizational culture. A healthcare organization should create an ethical environment by (Krueger & Stein, 2010): The capability of an organization to realize its full potential within the market place will largely depend on knowledge, motivation, skills as well as ethical values and

The impact of substance abuse in the work place Essay

The impact of substance abuse in the work place - Essay Example Being a supervisor, my responsibility involves maintaining a productive, safe and secure environment for all employees at the work place. It is also my responsibility to evaluate and conduct performance discussion with employees. In the course of my duty as a supervisor, it is expected of me to treat all employees fairly in a manner that does not demean anyone (opm.gov). During my supervisory duty, it came to my attention that Balbito exhibited the following problems of absenteeism at work missing work for about two days a week. In addition, Balbito also had the following problems; falling sick at work frequently, missing deadlines, sleeping at work, problems with handling recruits in a professional manner and being at loggerheads most of the time with other co-workers. Consequently, the situation prompted me to take intervention and referral preparation for the employee prior to the actual intervention and referral. To this regard, it became worthwhile to put down on paper the perfo rmance problem as concisely and precisely as possible. In addition, it was necessary for me to prepare myself professionally for a constructive confrontation with the employee, Balbito (opm.gov). The responsibility of diagnosing drug abuse or alcohol abuse is not among my duties. Furthermore, having all answers to problems of an employee is also not my duty. The responsibility of providing therapy or counseling is the duty of the EAP professionals not the supervisor. In my own perspective, these problems are mostly related to alcohol addiction. Although Balbito had earlier admitting having problems with alcohol abuse, I detected that it was rather an addiction. Balbito purportedly used alcohol for recreational purposes, but the symptoms of irresponsible handling of his duties suggested addiction of alcohol due to its use as a stress reliever. Since my professional requires strict supervision of the performance of employees, I intend to address the issue strictly with no sympathy in this context (opm.gov). First, am going to summon the employee (Balbito) and express my concern regarding his performance as a human resource professional. In the most precise manner, am going to inform him of the problem of alcohol addiction that has come to my attention. Additionally, I will avail the documentation of the problem to him in a professional way as the supervisor. At last, I will demand an explanation from him regarding his performance. Since the employee (Balbito) had already admitted his problem regarding alcohol abuse, I will refrain from personal issues and frame the discussion strictly to matters pertaining performance to resolve his problem. In a professional perspective, am going to address my concern regarding performance to get the employee (Balbito) to acknowledge the performance problem. During the performance discussion with the customer, I will order the employee (Balbito) to stop reporting to work under the influence of alcohol since it has a negative im pact on his performance. Adding to this, I will give the employee a fortnight to improve on his performance failure to which, he is subject to suspension from work for a period of one month. To make the intervention effective, am going to refer the employee (Balbito) to employee assistance program professional for counseling. By doing this, information concerning his privacy regarding this issue will be availed to him.

Assessing Young Learners Speaking Ability in the Fifth Grade of Three Elementary Schools in Padang Essay Example for Free

Assessing Young Learners Speaking Ability in the Fifth Grade of Three Elementary Schools in Padang Essay CHAPTER I INTRODUCTION A. Background of the Problem Communicative view development in English learning makes the focus on English teaching changed. What once became structurally focused, it now moves toward meaningful language-focused. Students are not asked to memorize structure-based dialogues without knowing the meaning anymore. There are no more grammatically controlled sentences for students’ meaningless repetition. Dialogues, if used, center around communicative functions and are not normally memorized (Richards Rodgers, 1986). That makes the teaching of speaking becomes the core part of English teaching. Just like the adults, young learners today are also taught speaking meaningfully and communicatively. However, young learners have distinctive characteristics compared with adult learners. One of them is children are still developing cognitively, linguistically, socially, emotionally, and physically (Teaching Knowledge Test Young Learners: Handbook for Teachers, 2010). In other words, in teaching speaking to them, teachers need to consider children’s development of skills in the native language first. Young learners also enjoy rhythmic and repetitive language more than adults do. They are more likely to play with language than adults are, and they can be more effectively engaged through stories and games (Peck, 2009). The different techniques and approaches in teaching speaking to young learners lead to different ways in the speaking assessment. This is the problem faced by Indonesian young learners’ teachers nowadays. Most teachers do not know how they should assess their young learners’ speaking ability; some finally choose to skip the speaking assessment and focus on pencil-paper-tests. Thus, this research is conducted to discover and reveal ways of assessing young learners’ speaking ability. B. Identification of the Problem Based on the background above, the speaking assessment techniques used for young learners should be different from the adult. It should be suited with their cognitive, linguistic, social, emotional, and physical development. As we looked upon Language Assessment: Principles and Classroom Practices by Brown (2010) and integrated it with curriculum standard in Indonesia, KTSP 2006, young learners will be better to be assessed in imitative and intensive speaking categories, such as imitating teachers’ saying, directed response tasks, read-aloud tasks, and dialogue completion tasks. Alternative assessments such as interviews and conferences can also be applied for them. C. Limitation of the Problem In this research, the problem will be focused on the speaking assessment techniques in the fifth grade of three selected elementary schools in Padang. D. Formulation of the Problem * What kind of speaking assessment technique used by elementary school English teachers? * Why do they use such techniques? E. Purpose of the Research The purpose of this research is to discover and reveal the technique used by English teachers to assess elementary school students’ speaking ability. F. Significance of the Research Theoretically, this research is aimed to give a description of how speaking assessment for young learners done in Indonesia. Practically, some techniques used by English teachers provided here can be a source of alternative speaking assessment. CHAPTER 2 REVIEW OF RELATED LITERATURE A. The Nature of Assessment There has been various explanation of what assessment is. Brindley (as stated in Linse, 2005) refers assessment as â€Å"collecting information and making judgments on a learner’s knowledge†. It means that in assessing students, we need to find out what students know about the subject being taught and how far that understanding has reached the learning indicator. In the same line with Brindley but with an addition, Brown (2010) states assessment as â€Å"an ongoing process of collecting information about a given object of interest according to procedures that are systematic and substantively grounded.† In his statement above, Brown implies that the process of collecting and judging students’ understanding is not done orderly in one single time; it is done continuously. Harris and McCann (1994) also give an essential note that in doing assessment teachers have to measure the performance of their students and the progress they make, as well as diagnose the problems they have and provide useful feedback. In other words, collecting and judging students’ intelligence is not enough; finding out what becomes students’ problem and giving advice to them to overcome the problems is also important to create a more successful learning process. Based on the theories above, it can be seen that assessment involves collecting information about students’ knowledge and judging their understanding in order to diagnose the learning problems they have so that students can get useful feedback to be more-successful learners. B. The Nature of Speaking As stated in the previous chapter, today’s English teaching focuses more on communicative purpose of language learning than in the past. It leads to the more important consideration of speaking skills than in previous time. Just like assessment, there is also various definition of speaking. One of them is from Lingua Links (1998) that defines speaking as productive skill in the oral mode that involves more than just pronouncing words. Referring to today’s communicative view, of course speaking cannot be thought as just pronouncing words; it needs to be meaningful, and communicative. Furthermore, Noonan (2003) states that, if pronunciation included, speaking involves three areas: mechanics (pronunciation, grammar, and vocabulary), functions (transaction and interaction), and social cultural norms and rules (turn-taking, rate of speech, etc). All of them are connected to each other and prove that speaking is not only about what is uttered, but also the meaning and social purpose. C. The Nature of Young Learners Young learner is a child who is in their first six year of formal education, from age 6 to 12 (Teaching Knowledge Test Young Learners: Handbook for Teachers, 2010). Many experts argue that it is beneficial to teach the children English since young age. TKT Young Learners (2010) notes one of the advantages that those children will have positive self-esteem toward English and it will help them to learn English more once they are adult. That is why teaching English to young learners considered important today. However, young learners have characteristics that make them different from the adults (Teaching Knowledge Test Young Learners: Handbook for Teachers, 2010). First, they are still morally, cognitively, psychologically developed. Based on Piaget’s theory of cognitive development, children in age 6-12 years old are still in concrete operational thought stage, they already have the ability to do logical reasoning and understand reversibility with the help of concrete objects (Santrock, 1998). It means that explaining theory will not do for them, we need to make them move, do games, sing, etc. Second, young learners often have no obvious reason for learning English. Unlike adults who want to do it because of the career-related reasons or teenagers that do it to pass an exam, young learners do not have concrete reason why they must learn English. However, it does not mean they are not motivated to learn English; their goodwill, energy, and curiosity to learning overcome that. Third, they may not always have well-developed literacy skills to support their learning of English. Many children in the age of 6-12 years old are just getting to know their first language. It means that as a teacher we need to not have too-high expectation and do more. Fourth, young learners often learn slowly and forget quickly. It is related to the first characteristic that young learners are still developed morally, socially, and cognitively. Their still-ongoing developments in those basic things make them forget easily and learn slowly. This is why songs, agmes, and chants do best for them. D. Principles of Assessing Young Learners According to METU Open Course Ware (2006), principles of assessing children’s language learning are: 1. Assessment should be seen from a learning-centered perspective. It means that we cannot get a true assessment by testing kids what they can do alone. It has been stated by many experts that the goal of learning English is to be able to communicate meaningfully in English. Testing students, let alone young children, as a tool to get true assessment will not congruent with the real goal of English learning and it will just be wasting time. 2. Assessment should support learning and teaching. This is something that is not also becomes a problem with young learners, but also with the adult. Before performance-based assessment is introduced, teachers chose paper-and-pencil tests as their source of assessing (Puppin, 2006). It becomes a problematic then since students do not see the connection between the learning and the test they are doing, ; they see them as two different incongruent things. If the assessment done is congruent with the learning they did, children will feel that what they have learned is useful. 3. Children and parents should understand assessment issues. Their understanding will make the assessment process more meaningful since they can participate and supports greatly on behave of children’s English development. On the other hand, if they do not understand why the teacher does this and that, there will be no good communication between these three subjects to help children’s development. E. Techniques of Speaking Assessment Brown (2010) states some techniques of speaking assessment based on students’ language development level: Imitative Speaking This kind of assessment is intended to see whether students can imitate saying in English correctly. Eventhough it focuses on the accuracy of repeating words, it does not mean that it cannot be communicative and meaningful. Besides, in recent years many experts have discovered that an overemphasis on fluency can sometimes lead to the decline of accuracy in speech. Intensive Speaking There are four tasks in this kind of assessing: directed response task, oral questionnaire, and picture-cued task. In oral questionnaires, students are first given time to read the dialogue to get its main idea and to think about the appropriate lines to fill in. Then, as the tape, teacher produces one part orally; the students respond. In directed response task, students elicit a particular grammatical form of a transformation of a sentence. Such tasks are clearly mechanical and not communicative, but they do require minimal processing of meaning in order to produce the correct grammatical output. Picture-cued task requires a description from the students. Pictures may be very simple, designed to elicit a word or a phrase, or composed of a series that tells a story or incident. This task is meaningful since sometime a little sense of humor is injected. Responsive Speaking Assessment of responsive tasks involves brief interactions with an interlocutor, differing from intensive tasks in increased creativity given to the student and from interactive tasks by somewhat limited length of utterances. The kinds of this assessment are question and answer, giving instructions and directions, and paraphrasing. Questions and answers involve oral interaction with teacher.

Problems of the Credit Rating Agencies

Problems of the Credit Rating Agencies Introduction On July 18th, 2007, while referring to adjustable rate mortgages (ARM) (also known as subprime mortgages) bonds, an executive of the Fitchs residential mortgage group said We continue to be confident that AAA ratings reflect the high credit quality of those bonds. Since then, between 2008 and 2009, 140 US banks declared bankruptcy while the International Monetary Fund now estimates world banks global losses due to loans and credit derivatives to approximate $4.1 trillion. If the subprime crisis has been the crisis of credit, it has also been the crisis of credit rating. Credit Rating Agencies (CRAs) (namely the tree major ones: Fitch Ratings, Moodys Investors Service and Standard Poors) have been under a lot of criticism in the recent credit crisis. Indeed, not only have CRAs been accused of making errors of judgment in rating structured debt securities, but also of operating a biased business model in an oligopolistic market. As a matter of fact, bond issuers, government regulators and investors have now lost their blind faith in credit ratings and therefore feel the compelling need to change, reorganize and restructure the CRA current business model and industry. Even though CRAs cannot be considered the sole responsible agent for the credit crisis, they have encountered great irregularities and problems: How can they be fixed? What solutions should be implemented to prevent the next credit crisis from happening? How has the credit and CRA crisis affected the leveraged finance industry? To tackle this question, we will first analyze what criticisms credit rating agencies have been subject to and what problems have been identified in the recent years. By evaluating different solutions and suggesting necessary changes, we will then examine how the credit rating business model and market structure could be improved. Finally, as it directly relates to the credit market and CRAs, we will study the impact of the crisis on the leveraged finance industry, with a special focus on leverage buyouts, buyout debt financing and structured finance. Section 1: Current problems of the Credit Rating Agencies business model Though many other players, such as lenders, borrowers, regulators, issuers, and macro factors, can be associated with and blamed for the current credit crunch, Credit Rating Agencies (CRAs) have been accused of being the main actors behind the malfunctioning and mispricing of the credit markets. Not only have CRAs been blamed for misrating complex structured debt products[1] and other subprime mortgage related products, but also of operating a biased business model in an oligopolistic market. In this first section, we will summarize these three main accusations and analyze in detail the validity of each argument. Solid and pertinent recommendations can only be made if the true problems have been identified. By analysing Moodys financial statements, we can observe that between 2002 and 2006, Moodys profits nearly tripled because of the growth of structured products, accounting for more than 40% of its total revenues in 2006, and the higher margins charged for these products.   Given the revenues generated, one would expect that CRAs did control the rating of these products. Now, after the default rate on adjustable rate mortgages (ARMs) reached its peak during the crisis and collateralized debt obligations (CDOs) became worthless, CRAs defended themselves by explaining how sophisticated these products were and how hard it was to rate them. This leads us to question, did CRAs rate products they did not understand? Before the mortgage market collapse, analysts like John Paulson expressed incredulity at what appeared to be a complete mispricing of the structured debt products and began predicting that the market would crash: For me it was so obvious that these securities were completely mispriced and we were living in a casino. I think the other players that were involved in the business got caught up in the exuberance, [] in the competition to increase their underwriting volumes, [] to increase their fees. They were very focused on annual earnings, quarterly earnings and annual bonus pools and with the amount of the liquidity, everyone got caught up in what became a massive credit bubble. (Distressed Volatility 2009) Mark Zandi, an economist at Moodys, noted in a report on U.S. Macro Outlook published in May 2006, that household debt was at a record and a fifth of such debt was classified as subprime. Unfortunately, the economic forecasting division is separate from the ratings division of the corporation. But how could CRAs not foresee the crisis and the flaws of their valuation models? The model used to rate structured products has been criticized for two reasons. First, Moodys rating model for assessing CDOs is a statistical model reliant on historical patterns of default. The main assumption behind this model is that past data would remain relevant, even during a period in which the mortgage industry (and its related products) was undergoing drastic change. Second, the use of this model revealed a large failure of common sense (Lowenstein, Triple-A failure 2008)by rating agencies as very complex securities shouldnt have been rated as plain vanilla bonds, for which the model was designed. CRAs were checking their statistical model, but not the underlying assets. As a consequence, Moodys noted in April 2007 that the model was first introduced in 2002. Since then, the mortgage market has evolved considerably with the introduction of many new products and an expansion of risks associated with them (Mason 2007) and thus revised the model it used to evaluate subprime mortgages. Similarly, in a response letter to Roger Lowensteins Triple-A failure article, Vickie Tillman, Executive Vice President of SPs Rating Services claims that her companys rating model includes both historical data and informed assumptions to assess credit quality. This adjusted model doesnt seem to solve the accuracy problem. Deven Sharma, president of SP, admits [] historical data we used and the assumptions we made significantly underestimated the severity of what has actually occurred (Sharma 2008) Even though one can acknowledge the greater complexity of CDOs and the difficulty of accurately assessing the risk profile of these products, the CRAs defence doesnt seem justifiable given the source of wealth these structure products represents to them. One would expect that CRAs would only provide a service they understood. There is still plenty of room for improvement in their models. Research led by Skreta and Veldkamp (Skreta and Veldkamp 2009) suggests that the complexity of any given asset hasnt increased but rather that the more complex types of assets became more prevalent. Indeed, when combined with the phenomenon of rating shopping, where issuers shop from one CRA to another to pick the best rating possible, asset complexity can lead to rating inflation and biased judgment. As a consequence, failure to address potential sources of bias inherent in the business model of the ratings industry could generate future problems. This discussion leads us to the conflict of interest inherent in the issuer-pay model, the second main accusation in our analysis. The conflict of interest between CRAs and bond issuers has been identified as the main problem because it drives the entire CRA business model. This conflict of interest between rating agencies and the bond issuers from whom they receive fees undermines the CRAs ability to give an unbiased assessment of credit risk. There are two types of potential conflicts of interest inherent in the issuer-pay model that may arise from the activities of the CRAs. The first is that rating agencies may be enticed to give better ratings in order to continue receiving service fees. Since CRAs revenues come from issuers, this conflict can lead to an agency problem. The second potential conflict relates to the consulting services CRAs provide to help the issuer to better design products to meet their models different thresholds. In both cases, CRAs run the risk of the issuer going to a different rating agency, which leads to the phenomenon of ratings shopping. Up until the 1970s, the investor-pay business model of credit rating agencies was straightforward: investors bought a subscription to receive ratings. It was during the 1970s that the business model evolved into an issuer-initiated ratings system where the issuers of securities began paying to be rated. Free riding by investors, leading to a reduction in profits for credit rating firms, was the main reason for this transition. As White (White 2002)observes, this shift also coincided with the rise in popularity of the photocopying machine. Although the issuer-pay business model has been around for more than forty years now, concern over ratings bias only recently emerged. Indeed, the conflict of interest, amplified by the rise of complex structured financial products, calls into question the objectivity of ratings that are critical to the efficiency of the market. (Levitt, Conflicts and the Credit Crunch 2007) In response to these accusations, CRA executives have maintained that the issuer pay model is not contradictory to the efficiency of their business model. It seems that a firm cannot support both issuers and investors simultaneously. In fact, the Report of the Staff to the Senate Committee on Governmental Affairs during the Enron case[2] cited empirical evidence: The conflict appears to be particularly acute for large important issues such as [] Enron []. In these cases investors desperately need guidance from credit rating firms, but often do not get it because of pressure from issuers, [] and in some cases, SEC officials. (Egan and Jones 2010) However, CRA executives have also asserted that CRAs have nothing to benefit from adjusting their ratings to their clients needs because they have a reputation to uphold. In June 2007, SP claimed that reputation is more important than revenues (Becker and Milbourn 2009) thus asserting that maintaining a good reputation had been a sufficiently strong motivating factor for CRAs to keep their high levels of efficiency and objectivity. In reference to this assertion we can ask ourselves: is reputation a sufficient motivating factor to maintain discipline among rating agencies? As a matter of fact, research led by Mathis, McAndrews and Rochet (Mathis, McAndrews and Rochet, Rating the Raters: Are Reputation Concerns Powerful Enough to Discipline Rating Agencies? 2009)has suggested that this argument is only valid when a large fraction of the CRA revenues comes from other sources than the rating of complex products. When the reputation of a CRA is good enough, and rating complex products become a large source of revenues (more than 40% of Moodys revenues), the CRA will become too lax and inflate its ratings. This mechanism builds on a three-step reputation cycle, ultimately resulting in crises of confidence where a single default provokes a complete loss of reputation by the CRA. First, the CRA tries to build and improve its reputation and gain investors trust by being very strict. Then, once a positive reputation has been gained, the CRA issues more ratings and takes advantage of its reputation. This is when CRAs become more lax and the risk of default incre ases.   Ultimately, when default occurs, there is a crisis of confidence: the opportunistic CRA is detected and its reputation is very negatively affected. This reputation cycle, which is also a confidence cycle, explains why opportunistic CRA are hard to spot and why ratings biases only recently emerged as a concern in response to inquiries from Vailiki Sketra (Sketra and Veldkamp 2009).[3] To exemplify this concept of reputation cycle, scholars find that CRAs are more likely to understate credit risk in booms than in recessions (Bolton, Freixa and Shapiro, The Credit Ratings Game 2009). Moreover, reputation seems greatly affected by competition, as it will reduce the effectiveness of the reputational mechanism for two main reasons.   First, reputation is only valuable if there are future producer rents. As a result, the incentive for maintaining a good reputation is reduced by competition. Second, from a microeconomical approach, if the demand elasticity facing individual sellers is higher in a competitive market, the temptation to either reduce prices or otherwise attract business may be stronger which undermines the quality of output. Therefore, the conflict of interest is not solved by reputation concerns. The second aspect of the conflict of interest relates to the collaboration between CRAs and issuers when designing a debt security. Lewis Ranieri, a pioneer in the mortgage bonds market, once said The whole creation of mortgage securities was involved with a rating (Norberg 2009). As a consequence, starting in the 1990s, CRAs started to offer consulting and advisory services to issuers to improve their ratings; a process that involves extended consultations between the agency and its client. The collaborative process that ensues is as follows: issuers propose a rating structure on a pool of debt. Then, the CRA will usually request a cushion of extra capital, known as an enhancement, to meet the necessary conditions for a specific rating. This practice can be dangerous because it is the CRAs responsibility to ensure that the cushion is big enough to safeguard the product, but issuers will try to minimize this extra capitalization in order to maximize their profit margin. Inside the CR As, consultants and raters were meant to be strictly separated by a Chinese wall'[4]. Regardless, CRAs (namely Moodys) began providing unsolicited ratings and offering consultancy services to improve them. Mr. Arthur Levitt, a former chairman of the Securities and Exchange Commission, pointed out in a recent article in the Wall Street journal that the conflicts of interest arising from such activities are the central problems with CRAs: [Credit rating agencies] are playing both coach and referee in the debt game. They rate companies and issuers that pay them for that service. And, in the case of structured financial instruments, which make it possible to securitize all those subprime mortgages, they help issuers construct these products to obtain the highest possible rating. These conflicts are hard to spot because transparency among these agencies is murky at best, and currently it is difficult to hold these agencies accountable for any wrongdoing (Levitt, Conflicts and the Credit Crunch 2007) The agencies are aware of the conflicts that are inherent to their business model but they claim that they are doing their best as to avoid them. In a letter to Roger Lowensteins Triple-A failure article, Vickie Tillman, Executive Vice President of SPs Rating Services defends her companys business models and practices: At Standard Poors, we recognize the business model we use may raise potential conflicts of interest. Thats why we have always had rigorous policies in place to manage conflicts, and why we currently are implementing additional measures to further strengthen the independence and quality of our ratings opinions. [] the role ratings firms play in the market [] is to provide independent assessments of the creditworthiness of bonds.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   In order to make up for these practices, the US Securities and Exchange Commission (SEC) issued a release in February 2007 proposing rules which would identify the issue of unsolicited credit ratings (those not issuer-initiated), as unfair, coercive, or abusive, and thus would prohibit Nationally Recognized Statistical Rating Organizations (NRSROs) from releasing unsolicited credit ratings.   Even though the SEC intervention seemed necessary, it didnt change the industrys business model: by 2007, the mortgage boom had already reached its peak. Regardless of the criticism surrounding the relationship between issuers and rating agencies, the fact of the matter is that they were simply bringing bonds to market based on market demand, which clearly indicates a crisis of the issuer-based model. CRAs misbehaviour has played a central role in the current subprime mortgage crisis. As such, the governments and regulatory bodies should take steps forward to correct the current business model. We shall therefore investigate alternatives to this model in Section 2 of this paper. This conflict of interest leads us to ask, who finally owns the ratings? The evidence regarding whether rating agencies bend to the issuers will is mixed. A paper written by contract-theory scholars, Faure-Grimaud, Peyrache and Quesada (Faure-Grimaud, Peyrache and Quesada 2007) investigates this issue by looking at corporate governance ratings in a market with truthful CRAs and rational investors. They show that at equilibrium, in a monopoly, a CRA will fully disclose information but that issuers may prefer to suppress their ratings if they are too noisy because full disclosure is impossible even when firms have the possibility for ownership (i.e., the right to disclose the rating). Additionally, they find that competition between rating agencies can result in less information disclosure since CRAs make zero profit and fully disclose information on firms that have values higher than the CRAs marginal observation cost. In fact, the current business model seems to favour the banks in their quest to receive better ratings. Dr. Joseph Mason compared default rates for corporate bonds to equally BAA-rated CDOs before the bubble burst and found that the CDOs defaulted more than ten times as often (Mason 2007). While, as we discussed earlier, it may be true that CDOs are much more complex securities than plain-vanilla bonds, another interpretation of the data is that CRAs were much more lax when dealing with a Wall Street securitizer as client. But who can blame them? While it is true that on the traditional side of the business (unsophisticated bond rating) CRAs have a large variety of clients (virtually every corporation and municipality that issues public debt), this is not the case in structured finance. On the contrary, the panel of clients is much smaller and the fees are much bigger. The only issue is that the client pays only if the CRA delivers the desired rating. If they do not, the client can e ither adjust the numbers or take another chance with a competitor, a process known as ratings shopping. Brian Clarkson, former president and CEO of Moodys Investors Service acknowledged, There is a lot of rating shopping that goes on. What the market doesnt know is whos seen certain transactions but wasnt hired to rate those deals (Bolton, Freixa and Shapiro, The Credit Ratings Game 2009). In fact, an important feature of the credit ratings market microstructure is the capacity for a security issuer to choose which ratings to purchase. During this process, a structured debt product is issued and the issuer typically proposes a structure to a CRA. The issuer then asks for a shadow rating, which remains private between the CRA and the issuer, unless the issuer pays to make the rating official. Such choices can reflect both explicit and implicit shopping for desired credit reviews and induce a selection effect in the rating process. Selection highlights the relation between the decision about whether to rely on unsolicited ratings and the potential for ratings shopping, illustrating how different types of potential conflicts of interest in the credit rating process could interact. Indeed, shopping for ratings is a practice at the heart of the different conflicts of interest we mentioned above, as it partly invalidates the reputation argument because there seems to be a trade-off between reputation concerns and the risk for ratings shopping. It also encourages CRAs to strengthen their ties and relationship with issuers, most notably by offering a wider range of services. In an interesting paper, Skreta and Veldkamp (Sketra and Veldkamp 2009) examine cherry-picking in ratings, especially for securitization, by issuers who shop for the highest ratings in order to obtain the hi ghest price when selling to naive or little-informed investors. They highlight the influence of risk aversion in motivating the purchase of multiple ratings. Indeed, because investors are risk-averse, they will try to invest in the best-rated securities for an expected yield without having to asses the risk of every security they may be interested in, and thus rely heavily on ratings. The more ratings they have for a security, the more likely they will be to invest in it. Skreta and Veldkamp (Sketra and Veldkamp 2009) conclude that when combined with asset complexity, rating shopping can lead to rating inflation and thus biased judgment. To support that evidence, Kurt Schacht, managing director of the CFA Institute Centre explained that CRA executives [] were concerned about the hype and insinuation that CRAs easily inflate their ratings in response to pressure from issuers and issuers, implicating the integrity of their process and ratings. In exploring that topic, we were very surprised by the results of our member poll where some 211 of the 1,956 respondents said they have indeed witnessed a CRA change ratings in response to external pressures (CFA Institute 2008). As a consequence, not only does ratings shopping enhance ratings distortion, but it also corrupts the entire rating process by giving issuers an incentive to trick their clients into buying overrated securities. A third and final issue to investigate is the lack of competition in the credit-rating industry.   According to The Economist (The Economist 2007), Moodys and Standard Poors dominated the industry by controlling about 80% of the total market in 2007. The third-place competitor, Fitch, had only about 15% of the total share that same year. The current form of these institutions received legal status when the SEC introduced the notion-barrier of the NRSROs in 1975. The rest of the market is divided among only a few other institutions that have received legal status.   While alluding to the dominance of Moodys and Standard Poors in the credit market, the U.S. Department of Justice has referred to the credit-rating industry as a partner duopoly (Laing 2007). As noted by Jonathan R. Laing, a partner duopoly differs from an oligopoly because the partners in the duopoly do no face fierce competition against each other because ones good fortune in winning a piece of business is typicall y followed by the others receiving the same deal at the same lush fee level (Laing 2007).This duopoly has proven quite profitable, as Moodys operating margin is typically around 50% (if not more) better than Microsoft, Accenture, Intel, Nike or Coca-Cola. In fact, according to Congressman Henry Waxmans statement during the Congressional hearings in October 2008, Moodys had the highest profit margin of any company of the SP 500 index for five years in a row. An important complaint arising from this situation is that the lack of competition permits the main players to shirk, engaging in less effort and research that if they were true active competition (Coffee 2006). It may therefore seem that a free market would ensure competition among its CRAs guaranteeing a higher quality and lower price of the ratings. For that reason, competition from new agencies might create a healthy diversity of opinion, leading to more accurate assessments of debt issuers default probabilities Many scholars have analyzed whether this industry structure contributes to the efficiency of the global credit market. We shall investigate in further detail what seems to be the optimal market structure in the next section by examining the solutions and changes necessary to combating the various issues we have so far considered. Other scholars recognize that the existing duopoly may present risks to the market, especially since the two-rating norm is still in full force. Furthermore, since the CRA business model is reputational-driven business, new competitors may face very high barriers to entry. The CRA industry could therefore not allow for more participants. On the other hand, some scholars suggest that the SECs role in both creating and perpetuating this duopoly by which establishing the status and necessary requirements to become a NRSROs, and an official registry. Since competition can both be seen as a problem and as a solution to the CRA industry and business model, we shall now examine the different initiatives that can be undertaken to improve the overall model and functioning of the credit rating market. Section 2: Solutions to fix the identified problems The subprime crisis has brought to light the poor performance of CRAs in rating structured financial products and reminded investors of CRAs past poor performance in predicting the East Asian crisis and the collapse of Enron[5]. Either directly by regulations, or by market force, there are strong signals that the credit rating business is about to change. The main accusations we previously addressed and the perception that CRAs contributed to the financial crisis led to various investigations and calls for reform. In this section, after briefly presenting CRAs reaction to criticism, we will first analyze the different alternatives suggested by scholars and experts to the current business model and the overall industry structure. We will then study the different reforms and regulatory recommendation that have been suggested to the current business model that would improve CRAs effectiveness and enhance the overall market efficiency. Finally, once these changes examined, from a regulat ory standpoint, we will observe the measures recently adopted by both the European Union and the US government (and regulating agencies), determine how the approaches differ and how necessary regulation is. CRAs reaction to accusations CRAs have responded to the allegations with cries of innocence.   If some rating firms claimed that they did nothing wrong and have indicated that they will cooperate openly in any investigation that comes their way, others   did acknowledge some mistakes and have announced the intention to reform their practices.   For example, spokespersons for Moodys, Standard Poors and Fitch have claimed that their organizations will demand more data and more verification and will subject their analysts to more outside checks (Lowenstein, Triple-A failure 2008) However, some may say that CRAs might have implemented these changes simply to avoid further criticism and regulatory intervention.   Indeed, as Lowenstein claims, none of this [] will remove the conflict of interest in the issuer-pays model .   We shall further analyze the case for self regulation in our analysis. In their effort to defend themselves, the CRAs have sought to minimize their role and influence within the financial industry.   According to a spokesperson for Moodys: We perform a very significant but extremely limited role in the credit markets. We issue reasoned, forward-looking opinions about credit risk. [] Our opinions are objective and not tied to any recommendations to buy and sell (Benner and Lashinsky 2007) The consensus of these critics is that the agencies dropped the ball by issuing investment-grade ratings on securities backed by subprime mortgages they should have known were shaky (Benner and Lashinsky 2007) Rather than accept responsibility for their own lack of diligence, the major CRAs have sought to lay the blame on the mortgage holders who turned out to be deadbeats, many of whom lied to obtain their loans (Lowenstein 2008).   Of course, it must be noted that other groups and individuals share the responsibility for the global financial downturn.   As Laing says in regard to CRAs, they were just one link in a subprime production line that stretched from sleazy storefront mortgage brokers, corrupt appraisers and avaricious originators to fee-crazed securitizers and, yes, mendacious borrowers (Laing 2007).   Nonetheless, as Laing further notes, CRAs must be seen as key enablers in the problems development.   i) New agency industry structure and business model Proposals have been made to improve the credit-rating system and thereby reduce the problems we identified. First, it seems that CRA need more independence. As Laing suggests it, many of the changes implemented in the auditing industry with the Sarbanes-Oxley Act could be similarly carried out. (Even though one may discuss whether this Act has improved capital markets transparency or not, one must note it has enforced the implementation of internal control, due diligence and transparency procedures in firms)For instance ratings agency employees should be prohibited from accepting any favors (whether it is money of gifts) from their clients and the leading analyst should rotate from a client to another with a certain frequency and should wait at least one year before joining their clients firm (an issuer or investment bank in this case) Laing also suggests that the 2003 SEC proposal, which prohibits the linkage of analyst compensation with new business development, could be reenacted. First, CRAs should be more transparent in two distinctive ways. The global credit market needs greater transparency about CRAs overall rating model: rating assumptions, methodologies, but also the fee structures, and past performance. To be more transparent CRAs should follow stricter disclosure requirements (as mentioned in the Rating Agency Act in 2006). Professor Charles W. Calomiris (Calomiris 2009) suggests that, more disclosure could also be required for publicly traded companies with rated debt when filling in debt-offering documents Particularly, in order to prompt CRAs to reduce or eliminate their conflicts of interest, they should disclose any structuring service or consulting-related activity (and the fees related to such practices) provided to a company in connection with the rating of fixed-income securities Second, there is a strong need, expressed by both scholars and analysts, for a clear distinction between the rating of structured products and traditional debt products and thus different rating symbols could be used so as to avoid confusion. The issue is, not all AAA-rated securities are created equally. As demonstrated in the current credit crisis and as proven by Drexel University finance professor Joseph Mason, CDOs receiving a Baa rating from Moodys were more than ten times as likely to default as similarly rated corporate bonds (Mason 2007). As a matter of fact, despite the identical symbols, structured products typically do not have the same risk profile as traditional corporate bonds. By nature, whereas corporate default can be estimated by very few factors (namely the level of leverage of the firm and its capacity to generate stable cash flows from operations), default on structured debt is dependent on hundreds or thousands of individual defaults [e.g., an underlying mortga ge pool] that are estimated given some distribution. They are not the same analysis so they should not be the same ratings. (CFA Institute 2008) A different rating scale according to the risk profile of the products could be used as to not mislead investors into buying misrated securities. As an alternative, Professor Coffee at Columbia University suggests the SEC could define a maximum default rate for different class of ratings, so that if a CRAs ratings were to exceed SEC parameters, it would loose their NRSRO status. (Coffee 2006) Building on this, the entire rating nomenclature could be changed and ratings could be expressed quantitatively as to avoid grade inflation in CRAs opinions. Indeed, in contrast to numerical estimates (of the probability of default (PD) and loss given default (LGD)),which do have objective and quantifiable meanings, letter grades leave more room for sub

Cultural Differences :: essays research papers

I Know I Am But What Are You? Cultural Differences in The Tempest, Montaigne’s Essays, and In Defense of the Indians Paper #2 The Tempest, In Defense of the Indians, and Montaigne’s essays each illustrate what happens when two very different worlds collide. As Europe begins to saturate New World soil, the three authors offer their accounts of the dynamic between the European invader and native other. Though each work is unique in its details, they all share a common bond: Shakespeare, de Las Casas, and Montaigne show the reader how European colonialists use differences in appearance and language to justify theft and slavery. The Tempest’s Caliban serves as an instrument to highlight the colonialist notion of the other. Caliban is the original inhabitant of the island; it is his native land. But Caliban is ugly. Prospero claims that he is "not honored with human shape" (p. 17), and so the new European inhabitants never think of him as a potential equal- they see him as their inferior. This initial incongruity between characters supports further dehumanization of the native for the remainder of the play. Caliban’s appearance does not only contribute to the Europeans’ poor estimation of him, but it also serves as the justification of his slavery. When Trinculo says, "Wilt thou tell a monstrous lie, being but half a fish and half a monster" (p. 55), he communicates two important concepts. First, Trinculo reinforces the idea that Caliban is more animal than man. Next, he assumes that Caliban’s exterior mirrors Caliban’s interior. Caliban’s physical deformities, according to Trinculo, also indicate deformity of character. Together, these faults aid Prospero’s justification of forcing Caliban to "serve in offices that profit us" (p. 18). A second factor of Caliban’s oppression is language. The ability to communicate that ends man’s isolation from others and leads to civilization. When Prospero discovers Caliban, the native has no knowledge of Europe, much less its tongue. Miranda and Prospero take it upon themselves to educate Caliban in "civilized" language. Miranda says: "I pitied thee, took pains to make thee speak, taught thee each hour one thing or other, When thou didst not, savage, know thine own meaning, but wouldst gabble, like a thing most brutish, I endowed thy purposes with words that made them known." (p. 20) Miranda believes that communication indicates that one is civilized. She does not for a moment consider that Caliban’s "gabble" was most likely his own language, the language he used to with Sycorax.

Philosphy and Science :: essays research papers

It is sometimes maintained that the conflicts of the twentieth century (war and international contests in general) might best be characterized as between the left and right political persuasions (e.g., â€Å"communism† against â€Å"fascism† or â€Å"democracy† against â€Å"fascism†). Defend or dispute such a characterization using the two socioeconomic and political systems that have been the central concerns of our readings and discussion: that of Sun Yat-sen (The Kuomintang on the Chinese mainland and on Taiwan) and that of Marxism-Leninism-Maoism (the Chinese Communist Party) in the People’s Republic of China. Your answer should include (1) ideological components (both domestically and internationally relevant), (2) structural features (leadership and political party properties), (3) economic strategies (both domestically and internationally relevant) and (4) general consequences. What are you prepared to argue are the major differences betwee n the two systems here discussed? Now, answer that question in a coherent fashion. Don’t try to answer each question in particular, except where the questions are numbered, for example, #1 ideological components, #2 structural features, #3 economic strategies, make sure that is clear so the readers understand that’s what you are answering. For example you say, as for ideological components, so something to indicate that you are answering that specific part of the question. Now, I think the question is relatively clear. It is a complex, but relatively clear question. I don’t know exactly what experience you have. You know again, as I told you, I am sort of visiting the planet sodospeak. I mean you are completely outside the range of my comprehension. I don’t know what you know, what you don’t know. Education nowadays has become so impoverished, I’m not even sure that you have the prejudices that we used to have. So right on this campus, my sense is, the world is divided between the left and the right. And so when they look back on the past experience of the preceding century, they think that the conflicts of the preceding century were on the left and the right, you see? And somehow the world is divided into the left and the right. Now, part of this, and if you read any of the material, again I am being very generous in my expectations, but if you read any of the material, for years, the second World War was characterized as a conflict between the left and the right. That carried over into Asia. Philosphy and Science :: essays research papers It is sometimes maintained that the conflicts of the twentieth century (war and international contests in general) might best be characterized as between the left and right political persuasions (e.g., â€Å"communism† against â€Å"fascism† or â€Å"democracy† against â€Å"fascism†). Defend or dispute such a characterization using the two socioeconomic and political systems that have been the central concerns of our readings and discussion: that of Sun Yat-sen (The Kuomintang on the Chinese mainland and on Taiwan) and that of Marxism-Leninism-Maoism (the Chinese Communist Party) in the People’s Republic of China. Your answer should include (1) ideological components (both domestically and internationally relevant), (2) structural features (leadership and political party properties), (3) economic strategies (both domestically and internationally relevant) and (4) general consequences. What are you prepared to argue are the major differences betwee n the two systems here discussed? Now, answer that question in a coherent fashion. Don’t try to answer each question in particular, except where the questions are numbered, for example, #1 ideological components, #2 structural features, #3 economic strategies, make sure that is clear so the readers understand that’s what you are answering. For example you say, as for ideological components, so something to indicate that you are answering that specific part of the question. Now, I think the question is relatively clear. It is a complex, but relatively clear question. I don’t know exactly what experience you have. You know again, as I told you, I am sort of visiting the planet sodospeak. I mean you are completely outside the range of my comprehension. I don’t know what you know, what you don’t know. Education nowadays has become so impoverished, I’m not even sure that you have the prejudices that we used to have. So right on this campus, my sense is, the world is divided between the left and the right. And so when they look back on the past experience of the preceding century, they think that the conflicts of the preceding century were on the left and the right, you see? And somehow the world is divided into the left and the right. Now, part of this, and if you read any of the material, again I am being very generous in my expectations, but if you read any of the material, for years, the second World War was characterized as a conflict between the left and the right. That carried over into Asia.

New France

New France was a new world far from home. Today Canada may be a hotspot for immigration, but back in the 17th century it was far from being an ideal land to start a new life. Despite various forms of persuasion and tactics, France had an incredibly difficult time colonizing Canada for many decades primarily due to the idea of emigration and the reluctance revolving around it. The act of leaving one’s country to settle in a new or foreign one can be quite daunting. The consideration of many points, both good and bad, would need to be taken into account before doing so. Factoring the length of time it takes to travel to a destination by ship, and the various misfortunes entailed with such a trip, one could say that the voyage itself â€Å"could have been a deterrent to migration† (Moogk 468). Apart from the physical journey, to â€Å"dislodge people from home and familiar surroundings† (Moogk 470), would be enough reason to cause individuals or families to be reluctant to colonize New France. But even with these hardships involved with emigration, the benefits of moving can be quite appealing. At the time of recruitment, parts of France were facing great hardship in the forms of â€Å"hunger and unemployment† (Moogk 470). It is no wonder that it was during these times that there were peaks in recruiting engages (indentured workers) for colony work. People were given a means of escape to a new land, and from there start anew. Offerings of â€Å"free land and settlement bounties† (Moogk 475), were offered to those willing to become colonists. Some disadvantages of emigration proved to be significant barriers to settlement. With all that said, the decision of emigration is a life changing one even to this day. As mentioned earlier, various barriers hindered the settlement process considerably. The most apparent barrier preventing settlement was to gathering people to go in the first place. People who understood the harshness of leaving home for unknown lands, thought twice about making choices regarding recruitment. The Iroquois’ â€Å"threat of murderous incursions that had alarmed colonists† (Moogk 487), death can be a big deterrent. If getting people to go to Canada was not a big enough issue in the first place, preventing workers from returning home proved to be an even reater feat. Familial issues played a key role in whether or not an engages returned to France or not. The fact that some workers solely left for the sake of work, while family remained back at home, hints towards the hope of return. The indentured workers of France typically went to serve for three full years in order to â€Å"learn all the skills needed for survival in Canada† (Moogk 479). Usually this meant that when their service time was completed, they would want to return home to family and did not consider staying in New France to colonize it. A tactic used to keep workers away from returning home and keep them on the new land was â€Å"bringing out entire families† (Moogk 476), so as to fix them in place and remove their reluctance to stay. This is not to say that the workers wanting to return home are always the cause for abandonment. There are cases, in which family from back home would remind workers of their â€Å"duty and material interests demanding their return home† (Moogk 484). So even when the worker left with the intention of becoming a colonist, their family ties would creep up on them and relieve them of their colonial dreams. Home sickness could be a big enough reason to want to go home, regardless if a person had friend or family waiting for them. As a response to the excess number of bachelor workers who went to New France to work unwillingly, with the possibility of leaving once done, the â€Å"filles du roi† emigrated over in hopes of finding â€Å"marriage and, perhaps, a more honorable match than was possible at home† (Moogk 482), this reason of starting a family and new life could counteract homesickness. Unfortunately, there was not always an abundance of strong hard workers, and the possibility of â€Å"persons unsuited for work because of their advanced age, infirmities, illnesses† or they were just â€Å"very weak, of low age, and of little service† (Moogk 480), being recruited would only handicap the progression of settlement. In the end it seems the biggest issue that prevented settlement was the people of France wanting to settle in new lands or not.