Is Race A Major Issue In US Today Politics Essay

Is Race A Major Issue In US Today Politics Essay Historically, the problem of racism persisted in the US. In fact, racism in the United States has existed since the founding of the state.  Society, founded by white men, differing in their national and religious grounds, was very different with their attitude towards other groups.  Victims of racism were non-white indigenous population Indians and black slaves. Significant progress in overcoming racism in the U.S. has been in the 1960s, when the success of the movement of the struggle for civil rights there were taken considerable political and socio-economic measures to ensure equality and overcoming age-old gulf that separates African American, Native American and other minority groups from  mainstream of American life.  However, racism still remains one of the hottest topics in American public life. Although the race problems take significant place in the life of the people in the United States, there are examples of the improvement of the situation. Imagined differences are built into the main quality and turn into a hostile psychological attitudes towards some ethnic group, the unit that separates people psychologically, and then theoretically justifies a policy of discrimination. Race is a major issue in the United States today but it is important to place emphasis on the fact that, today, race issues tend to change although the problem of racism has not been eliminated yet. Definition of racism In order to understand the current situation in the US concerning race issues, it is necessary to dwell upon the definition of the concept of racism. At this point, it is worth mentioning the fact that the concept of racism is closely intertwined with the concept of discrimination because racism implies the discrimination on the ground of race of an individual. At the same time, the concept of racism can be defined as the violation of basic rights and liberties of individuals because of their race. In this regard, racism can have different manifestations, including the oppression of racial minorities and their discrimination. In the past, cases of racism occurred frequently and racial minorities suffered from the severe oppression from the part of the dominant white majority. As the matter of fact, racism can exist in any multiracial societies. Therefore, the emergence of racism in the US can be viewed as a natural effect of the domination of racial group over others. On the other hand, it is worth mentioning the fact that the concept of racism changed and evolved in the course of time. In the past, racism was taken for granted and the violation of rights of non-white Americans was a norm. For instance, it is possible to refer to numerous cases of lynching of African Americans in the beginning of the 20th century. By the mid-20th century, the attitude of Americans has changed under the impact of the growing Civil Rights movement and effective work of civil rights activists. The Civil Rights movement of the 1950s 1960s contributed to the consistent change in racial relations in the US but the Civil Rights movement still failed to solve the problem of racism in the US. In spite of consistent legislative and social changes, race issues and the problem of racism persisted in the US in the second half and late 20th century. Race issues still involved the problem of discrimination and unequal opportunities for white and non-white Americans. The problem persisted and, today, this problem needs the effective solution. Modern perception of racism In actuality, the modern perception of racism has changed consistently compared to the past. At this point, it is necessary to dwell upon the changes that have occurred in the society to understand the essence of the change of the perception of racism in the modern society. First of all, it has been already mentioned above that, in the past, racism was taken for granted, it was a sort of norm. Cases of violence and murders of representatives of minorities were frequent. Steadily, the attitude to racism changed. Today, the problem of racism is viewed from a bit different angle. To put it more precisely, today, racism refers to the field of the under-representation of certain racial groups in the political life of the US. In addition, many representatives of racial minorities suffer from discrimination in the workplace, when they fail to obtain equal job opportunities. At the same time, today, socioeconomic position of people and their job opportunities as well as their participation in the political life of the country depend on their educational background. At this point, it is important to place emphasis on the fact that the access to education and opportunities to receive higher education are crucial in the modern society. As a result, education, being unavailable to certain racial groups, to minorities, becomes one of the most important issues provoking tension between representatives of different racial groups in the US. The role of education in the life of the modern society can hardly be underestimated because the modern technology keeps progressing and people should come prepared to use new technology to succeed in their professional life and to play an active part in the social, political and economic life of the country. For instance, the emergence of mass media and new telecommunication technologies contribute to the consistent growth of the speed of spreading information. In this regard, many specialists indicate to the fast spread of information The Boyfriends Death (Brunvand, 78) story by J.H. Brunvand. The information is spread nationwide fast that naturally affects consistently race issues. To put it more precisely, the fast spread of information can affect consistently the public opinion, including cases when information refers to race issues. In this respect, it is possible to refer to some cases of violence from the part of white police officers in regard to African Americans and other minorities. The information being spread fast nationwide evoke strong opposition within the society to cases of racial discrimination. Discrimination In actuality, the problem of racial discrimination persists and the President of the US, Barak Obama does recognize this problem. At the same time, he attempts to unite the nation and eliminate racial differences: We the people, in order to form a more perfect union. (Obama, 304). In actuality, race issues have changed consistently but the problem of racism persists in the American society: And yet words on a parchment would not be enough to deliver slaves from bondage, or provide men and women of every color and creed their full rights and obligations as citizens of the United States. What would be needed were Americans in successive generations who were willing to do their part through protests and struggle, on the streets and in the courts, through a civil war and civil disobedience and always at great risk to narrow that gap between the promise of our ideals and the reality of their time. (Obama, 305). In fact, the US society still suffers from wide gaps between the dominant racial group, i.e. white Americans, and minorities, i.e. non-white Americans. In such a situation, the development of new, effective solutions to the problem of racism, racial inequality, racial discrimination and other race issues is essential. At this point, it is very important that the US policy makers, namely the US President, are conscious of the importance of solution of the problem of race issues: unless we perfect our union by understanding that we may have different stories, but we hold common hopes; that we may not look the same and we may not have come from the same place, but we all want to move in the same direction towards a better future for of children and our grandchildren. (Obama, 306). Hence, the union of the nation is the ultimate goal of current policies of the US government but it is still important to find effective tools, which can help to solve the problem of racism and other racial issues. Current issues and limitations In actuality, it is possible to single out new, emerging racial issues, which aggravate the problem of racism and make relations between different racial groups extremely complicated. At this point, it is possible to refer to the speech delivered by Barak Obama, who stated: At various stages in the campaign, some commentators have deemed me either too black or not black enough. We saw racial tensions bubble to the surface during the week before the South Carolina primary. The press has scoured every exit poll for the latest evidence of racial polarization, not just in terms of white and black, but black and brown as well. (Obama, 307). At this point, it is possible to raise the problem of the the growing racial diversity and emergence of new racial tensions, including tension between minorities. What is meant here is the fact that today racial issues refer not only to relations between the white majority and non-white minorities but also to relations between non-white minorities. In fact, the aforementioned problem can lead to the radicalization of the US society: expressed a profoundly distorted view of this country a view that sees white racism as endemic, and that elevates what is wrong with America above all that we know is right with America; a view that sees the conflicts in the Middle East as rooted primarily in the actions of stalwart allies like Israel, instead of emanating from the perverse and hateful ideologies of radical Islam. (Obama, 308). The radicalization of the society will lead to the consistent deterioration of the socioeconomic and political situation in the US and it may undermine the existing social order. Hence, the solution of the problem of race issues is essential for the stability of the existing social order in the US. Future directions In such a context, the US authorities should define clearly the major priorities and strategies that can help the US to solve the problem of racism and race issues. In this regard, Barak Obama argues that: by investing in our schools and our communities; by enforcing our civil rights laws and ensuring fairness in our criminal justice system; by providing this generation with ladders of opportunity that were unavailable for previous generations. (Obama, 310). In fact, Obama indicates to one of the possible ways to improve the current situation in the US society and to solve, at least partially, the problem of the tension between different racial groups. The President suggests the complex solution, which focuses on key areas, where race issues arise, including, education, justice system, civil rights protection, and others. In such a situation, Obama gives insight toward the ultimate goal of the suggested changes may be defined as follows: a country that has made it possible for one of his own members to run for the highest office in the land and build a coalition of white and black; Latino and Asian, rich and poor, young and old is still irrevocably bound to a tragic past. But what we know what we have seen is that America can change. That is true genius of this nation. What we have already achieved gives us hope the audacity to hope for what we can and must achieve tomorrow. (Obama, 309). Obviously, this is an optimistic forecast for the future elimination of existing problems related to race issues. Nevertheless, the strategy is defined clearly but still the US lacks effective tools with the help of which the problem of racism and race issues can be eliminated. Conclusion Thus, taking into account all above mentioned, it is possible to conclude that the problem of racism and race-related issues persists. Although officially a race cannot be identified as a major issue problem in the United States, there are still many issues and details considering the race issue. All in all, the race still remains one of the major problems in the United States, which is still not solved. In fact, this means that the US still suffers from the discrimination and oppression of minorities. In this respect, the US authorities are conscious of the fact that race issues may pose a number of serious problems and, what is more, they may lead to the radicalization of the US society. Therefore, the solution of this problem becomes strategically important for the US authorities. In actuality, the US authorities, namely the President of the US, defined the major priorities in the development of their policies to tackle the problem of racial discrimination and other race issues. Obviously, the unity of the entire country is of the utmost importance and the unity of all Americans, regardless of their race, can unite the nation. However, it is still unclear how the President of the US is going to unite the nation and to eliminate wide gaps that persist between different racial groups. As long as these gaps exist, the US will deal with race issues.

The Uses And Misuses Of Derivatives Finance Essay

The Uses And Misuses Of Derivatives Finance Essay Hedge funds are pools of investment that invest in almost any opportunity in any market where they foresee impressive gains at reduced risk. Hedging refers to implementing strategies that manage or protect against an identified risk exposure. They take leveraged positions in publically traded equity, debt, foreign exchange and derivatives. The primary aim of most hedge funds is to reduce volatility and risk while attempting to preserve capital and deliver positive returns under all market conditions (Friedland., 2008). Derivatives provide institutions the opportunity to break financial risks into smaller components and then to buy or sell those components to manage risk. Hedge funds hold a number of assets; they use derivatives to protect against the adverse price movement of these assets. Hedge funds play more of the role of speculators than of hedgers. They use derivatives when buying and selling assets and by putting long-short positions, they seek to hedge themselves against broad market moves while profiting from changes in the relative value of the instruments they go long or short. Hedge funds offer a variety of unique strategies to utilize when investing in hedge funds, these are called hedging techniques. These include Market Neutral Strategies, Event Drive / Special Situations Strategies, Long Short, Global Macro, Sector and Country, Dynamic Strategies, Funds of Funds, Funds of Funds of Funds etc. (http://www.global-derivatives.com) Market Neutral Strategies are used in Market Neutral Funds. They tend to take positions which offset each other through both a long and short position simultaneously to reduce their risk exposure. These strategies include Long Short and Convertible Arbitrage. Long-Short methodology attempts to reduce market risk by taking both long and short positions in the market. This can be done by taking a long position in undervalued assed and a short position in overvalued ones. In these funds, it is anticipated that the undervalued assets will increase in value than any losses incurred from the overvalued assets, or vice versa. Convertible arbitrage is a relatively more complex strategy. In this convertible securities such as convertible bonds which can be converted into normal shares or bonds are bought, to take advantage of any price discrepancies between the convertible security and that of the exchangeable underlying. A position can be taken for buying convertible security or selling the underlying asset to realise any difference in prices. (http://www.global-derivatives.com) Event Driven / Special Situations Strategies intend to make profit from events related to particular companies. Event Driven funds take a bet that something in the future will happen which will affect the company and its assets in a particular way. These funds include Distressed Securities and Merger/ Risk Arbitrage; these securities include debt and equity of companies undergoing reorganization or bankruptcy, it is hoped that companies will recover and increase in value. These securities have very low value and can be given to the management of a company during the restructuring process. Merger/Risk Arbitrage funds tend to analyze companies which are potential takeover or merger targets by taking two positions. An example of it would be to buy the stocks of a company that is being acquired with hope that its prices will rise and to sell stocks of the company that is acquiring, in anticipation that its value might fall. (http://www.global-derivatives.com) Long Short is another strategy which includes buying and selling a security based on the sentiments in the market or of a company. It includes short selling, long, and growth fund. Short selling occurs when a person anticipates that the price will fall in future and sells a stock which it does not possess, through borrowing. If the price really falls in future, they buy the lot from the market at a lower price and return it to the one they borrowed from earlier at lower price, thus making a profit. Long is another strategy in hedge funds, it is a fixed income instrument that benefits from the rise in the price of the held asset. They often utilize leveraged positions to maximize returns. Global Macro is an economics based strategy which intends to benefit from shifts in global economic conditions such as inflation, interest rates and other macro-economic factors; a common example of it is the use of interest rate derivatives for speculative purposes, they give profit from economic movements within particular countries. Sector and Country strategies include sector funds and emerging markets. Sector funds are hedge funds that specialize within a particular industry for example technology, textile etc. these investments consist of long or short positions in stock, debt, or even derivatives on the stocks. Emerging markets include funds that emphasize on emerging markets with less-developed economies and aim to profit from market growth which influence the securities positively. Securities in these hedge funds include sovereign debt or corporate securities with the anticipation that their prices will rise with economic growth. Dynamic strategies include elements such as market timings and opportunistic. Strategy of market timing involves the right timing of the market. It includes making profit based on the correct timing of investments across markets by moving between various asset classes depending upon the view of the manager regarding the market environment. Opportunistic strategy involves switching across asset classes, they use a number of strategies mentioned above depending upon the managers discretion, and the reason for switching strategies is to make the most profit. (http://www.global-derivatives.com) Funds of funds is the strategy of hedge funds to invest in other hedge funds in order to diversify the risk and exposure. The success of these funds depends upon the managers way of handling the funds rather than the performance of the actual investments. Funds of funds of funds or F3s is a new concept to hedge the risk exposure in terms of investments by reducing the volatility of the funds itself. They are good for high risk-averse investors willing to invest in the hedge funds industry. (http://www.global-derivatives.com) Amaranth Advisors LLC (Amaranth) Formation and Background Amaranth comprises of Amaranth LLC and Amaranth Advisors LLC. It was founded by Nick Maounis (Maounis) in 2000 as a multi-strategy hedge fund with a special focus on convertible arbitrage (selling (short) equity stocks and at the same time buying (long) convertibles of the same company creating a delta neutral portfolio), with its headquarter in Greenwich, Connecticut and with approximately $600 million in capital. Maounis experience was in managing a number of various arbitrage accounts in the US, Japan, Europe and Canada. The aim was to make profits from the small discrepancies in prices of stocks and bonds, through its structure of three principal funds Amaranth Partners LLC, Amaranth Capital Partners LLC, and Amaranth International Limited and the 27 investment professionals. It sought to employ a group of arbitrage trading strategies particularly featuring convertible bonds, stocks of merging companies and utilities. However, Over the years, the trading activity of Amaranth ex panded into merger arbitrage (making a riskless profit by purchasing individual stocks of two merging companies and selling them together), leveraged loans (loans given/extended to individuals or companies that already have large debts on their books), blank-check companies (developing companies) ,volatility trading arbitrage (buying or selling an option on an underlying instrument and selling or buying a varying percentage of the underlying instrument this to gain from the difference between the implied volatility of an option and forecasted future probable volatility of the corresponding underlying instrument), long/short equity, and energy trading. (ICMR, 2010) Strategy As noted above, at the time of formations and throughout its term, the firm emphasized that it was a multi-strategy hedge fund, but as it could be noted in the aftermaths that most of the firms investments and losses were in natural gas derivatives. Amaranths basic strategy comprised of trading in the Natural Gas market; the firm took a long position in winters, with hope that the prices will rise, especially when the demand for natural gas exceeds the supply and storage capacity due to the cold season. Its winter months were November, December, January, February and March. Amaranth used to take a short position in summers when it anticipated that the prices will fall. Part of its strategy also included taking short position in April and long position in March. Moreover, another strategy was to purchase call options on winter months and put options on non-winter months. Amaranth used to bet that natural gas prices will rise, and the spreads in March and April prices will rise as well. Nature of Natural Gas Market By nature, the natural gas market is very risky and volatile. Majorly because there is a commercial need for the commodity. This situation creates a need for an institution to control its supply and storage. In America, there has been inadequate storage capacity of natural gas for peak the winter season demand. Therefore the price of natural gas is higher in winters; firstly due high demand and secondly due to increase the incentives to store natural gas. These factors raise the prices of winter natural gas contracts to an all time high level. Apart from that, the market of natural gas is also volatile because the natural gas production in America is lower than the rise in the demand for natural gas. U.S. Natural Gas markets are shielded from the global energy factors because a very small amount of US natural gas need are met by imports of Liquid Natural Gas (LNG). Commodities trades require less margin money (collateral) than other markets. On the main exchanges, trades post 10 percent of their positions value, whereas in the stock market, 50 percent is common. (Davis, Sender, Zuckerman, 2006). After gaining credit from banks, it is very easy for commodity hedge funds to get highly leveraged quickly. Traders of natural gas have a number of options. The largest exchange for trading natural gas is the NYMEX (New York Mercantile Exchange) which has standardized futures contracts up to few delivery months up to 5 years that are traded on the exchange. Traders can also use ICE (Intercontinental Exchange) which is an over-the-counter market for trading natural gas futures contracts. There has been a lot of debate if hedge funds have an impact on energy trading. According to Gary Gensler (a former Goldman Sachs banker and treasury department official and chairman of the Commodity Futures and Trading Commission (CFTC) the chief regulator for energy futures energy trading said I believe that excessive speculation in commodity futures can cause sudden or unreasonable fluctuations or unwarranted changes in commodity prices,. He also expressed his opinion that the rapid growth of commodity index funds and increased hedge fund allocation to commodity assets contributed to the bubble in commodity prices. (Delamaide, Jan 11, 2010) Performance The founders original expertise was in convertible bonds (Till, 2006). The firm later specialized in leveraged loans, blank-check companies and in energy trading. Till June 30th 2006, energy trades accounted for about half of the funds capital and generated about 75% of their profits. (Till, 2006) In 2002 Amaranth started trading with JP Morgan Chase, in energy commodity trading. The winters of 2003 were exceptionally cold and lasted till February, this raised the prices of natural gas manifolds, and this in turn gave huge profits to Amaranth due to its long position in winters. By 2004-5 Amaranth shifted most of its investments into energy trading. The company used to make huge profits from placing spread trades and placing bullish bets on energy in 2005. In the same year America was severely hit by Hurricane Katrina, which adversely impacted it natural gas and oil production and refining capacity. This raised the price of natural gas and Amaranth reaped huge profits out of it. The accounts of Amaranth LLC showed robust performance by the company since its inception. The compound annual return for the period September 2000-November 2005 according to media reports was 14.72 net of all costs. (Gupta Kazemi) The chart below shows Amaranths returns till May 2005. The chart compares the Amaranths returns against CISDM Equal Weighted Hedge Fund Index and CISDM Convertible Arbitrage Index. Amaranth had gained a noteworthy position in May 2005, in CISDM Equal Weighted Hedge Fund Index. The chart show the volatility Amaranth was facing in May 2005, this volatility had brought high returns in the past but things then started taking the turn towards the wrong side. Amaranths returns; source: (Gupta Kazemi) NYMEX (New York Mercantile Exchange) noticed Amaranths considerable open interest of 51% in Aug 2006 in September natural gas futures contract, which would expire at the end of the month. NYMEX (New York Mercantile Exchange) brought its concerns into notice to Amaranth. Amaranth not only reduced their September but also Octobers positions, as per the directions of NYMEX (New York Mercantile Exchange). Alongside Amaranth increased their positions in October and September positions under ICE contracts, thus escalating their overall positions in natural gas. (Gupta Kazemi) According to US Securities and Exchange Commission filings, investors in Amaranths funds included a number of Wall Street banks including Morgan Stanley, Credit Suisse Group and Deutsche Bank AG. (Burton Leising, 2006) Amaranth was marketing energy and commodities fund to open in December 2006 of about $5 billion. The fund was to be managed by Hunter and Jeff Baired, co-head of Amaranths Global energy and commodities business. But unfortunately the events that followed didnt allow it to happen. (Burton Leising, 2006) Collapse and Beyond Amaranth used to bet that natural gas prices will rise, and the spreads in March and April prices will rise as well. However in 2006, so did not happen and gas prices began to decline due to rising inventories leaving Amaranth on the wrong side of the market trend and consequently reducing its portfolio value of $9.2 billion by less than half. Headed by Brian Hunter, it seemed that Amaranth had not anticipated the rise in the natural gas storage capacity, and the weather pattern bringing a warmer winter. It was in a weeks time that Amaranth lost 65% of its $9.2 billion assets. On September 14 alone, the fund lost $681 million from its natural gas exposure. On September 20th 2006, Amaranth sold its entire energy trading portfolio in a flurry to J.P. Morgan Chase and Citadel Investment Group. It did so at significant discounts to the portfolios then mark-to-market value. (Till, 2006) At the time of liquidation of Amaranth, the spread on gas future declined. The spread on positions held by Amaranth were $2.85 in late August, but after the liquidation had reached below $0.75. (MORGENSON ANDERSON, September 20, 2006). This indicates the lower price expectations in both the bid and ask price for every $1 invested in Amaranths holdings. When Amaranth Advisors LLC announced that it had suffered losses just as big as LTCMs, markets did not respond for Amaranth the way as they did for LTCM (Long Term Capital Management). New York Fed did not hold summit meeting for a bailout plan; but JP. Morgan Co. and Merrill Lynch Co started selling off Amaranths portfolio of natural gas futures. The co-founder of Energy Hedge Fund Centre (which tracks 520 energy funds) said, There is not systematic risk. The market can absorb this. (Mufson, 2006). The reasons for such a reaction were that, firstly Amaranth (although was doing rash trading) but borrowed less heavily and had less leverage than LTCM (Long Term Capital Management); secondly its positions were smaller and focused in natural gas futures. LTCM s failure threatened the stability of banks, whereas Amaranths failure only hurt imprudent investors in the natural gas market who hadnt done any research before investing. Amaranths co-founder and chief executive, Nicholas Maounis, said in his letter to investors that the fund was aggressively reducing our natural gas exposure to meet payments to creditors. The said that there was large scale fluctuations in the value of the fund, which was up sharply in August, would be down 35 percent for the year after the sell-off. Later Maounis said that the conditions in the natural gas market deteriorated and market liquidity dried up so quickly that the fund was unable to unwind its energy positions. He said it became clear that we couldnt trade out of it. Amaranth had no choice but to sell its positions at a huge loss because the fund was faced with margin calls and couldnt borrow anymore because of the liquidity problem that emerged once news of its losses hit the market. Maounis apologized to the institutional investors, pension funds and wealthy individuals who lost money as a result of the bad trades. He said We feel bad about losing our money. We feel even worse about losing your money. (CBC-News, 2006) Officially at Amaranth desperately tried to sell the fund to Citigroup. But despite the extensive talks and negotiations, Citigroup decided to walk away from making any deal. (Taulli, Sep 29th 2006 ) On July 25, 2007, the Commodity Futures Trading Commission (CFTC) charged Amaranth and head energy trader Brian Hunter with Attempted Manipulation of the Price of Natural Gas Futures including making false statements to the New York Mercantile Exchange (NYMEX). The Federal Energy Regulatory Commission has also charged Amaranth and its traders with market manipulation. Amaranth filed a lawsuit against JP Morgan claiming US$ 1 billion in damages, on the grounds that the bank interfered in the companys work to make a deal with Goldman Sachs and Citadel Investments. The Federal Energy Regulatory Commission (FERC) later announced a settlement with Amaranths defendants. However Commodity Futures Trading Commission (CFTC) did not withdraw its charges on Amaranth and on August 12, 2009, the federal court ordered Amaranth to pay a $7.5 million civil monetary penalty. The court also enjoins Amaranth from violating the anti-manipulation provisions of the Commodity Exchange Act. (Release, 2009) Amaranth then sued Touradji and his employees (Touradji Capital Management LP), by filing a complaint on September 18, 2006 in New York Supreme court in Manhattan, seeking at least $350 million for claims including breach of contract and misappropriation of trade secrets. Amaranth says that Touradji Capital Management LP breached two contracts agreed to in September 2006 regarding the transfer and purchase of Amaranths base-metals portfolio. According to the official documents, Touradji Capital Management LP used the information to recover profits obtained by defendants through improper trading practices and misuse of plaintiffs propriety and confidential information. Maounis, through a spokesman, refused to comment on the Touradji Capital Management LP suit (Chanjaroen, 2006). However in September 2009, Amaranth withdrew the summon it filed against Touradji Capital Management. Neither of the parties made a payment of any kind due to the withdrawal of notice. After the fall of Amaranth, Goldman Sachs was quick to come into action, and struck a deal to take over hedge fund manager of Amaranth Advisor LLCs lease at Greenwich America. Goldman occupied about 124,000 square feet at the property, which had served at Amaranths headquarters before the company was wound up in September. Amaranths lease was to expire in at the end of 2015 and had a rate of about $35 per square foot. (Ambroz, April 10, 2007) Internal control or Management of Amaranth Maouniss original expertise was in convertible bonds. In mid 2004 Maounis hired Brian Hunter (Hunter) an energy trader who was working for Deutshe Bank energy trading desk. Calgary-based Hunter was Amaranths head energy trader, who was given a free hand to trade the commodity market, due to his past experience of taking huge positions and making huge profits in the natural gas market. Maounis was impressed that Hunters made hundreds of millions of dollars (around 1 billion) for the firm in 2005 after Hurricane Katrina sent natural gas prices soaring, made the 32-year-old Canadian a co-head of commodities trading. Maounis let Hunter increase the size of his natural gas positions so that they became more than half of the entire firms exposure. This was against Amaranths claim of maintaining a multi-strategy fund. Before Hunters arrival, all commodities positions made up about 20 percent of Amaranths portfolio with natural gas having roughly 7 percent share. Amaranths partners had a confidence built on past success and they thought that they had a fool-proof strategy (taking long position in winters and short in summers); the company had reaped huge profits in 2002-2005 from this strategy. Amaranths website said moving nimbly and effectively within an ever-changing investment landscape and said that its employees possess fearlessness with respect to complexity, learning, as well as invention, and continuously strive for perfection. Maounis, said he had chosen the companys name, which means unfading in Greek. According to the wall street journal, Brian Hunters had so much success in trading natural gas futures, or bets, on the future prices of the commodity, that Amaranth allowed him to work from his home in Calgary, where he drove a Ferrari in summer and a Bentley in winters. (Hedge fund: a gamble too far, 2006, September 20). Analysts estimate that in order to fund his positions, Hunter was borrowing $8 for every $1 of Amaranths own funds. When the bet went in his favour, he could pay back the debt and keep the rest of the profit for Amaranth. As the bets started to go against him September 2006, his borrowing amplified his losses. (Hedge fund: a gamble too far, 2006, September 20). It is commonly believed that hedge funds improve the efficiency of the financial markets by introducing liquidity and innovation (Hedge fund: a gamble too far, 2006, September 20). However Amaranths collapse shows that the hedge fund managers earn for their lavish salaries only and not for the investors who have put up their earnings and savings in their funds. Operational risk is the risk associated with the internal management of the company and the probability of making wrong decisions that might harm the performance of the firm. Amaranth seemed to be suffering highly from operational risk. Hunters had a target of making $2 billion for the year at the end of August 2006. Analysts comment of such a target that Hunters must have had an unconsciously large position for this market, One of the biggest players in the energy markets, such as Goldman Sachs Group, would take up positions less than a tenth as big as Hunters, traders said. Hunter was involved in rash trading in the market as his positions were often twice as big as the next biggest. It is also said that in Amaranth, there was an exclusive risk manager for every trading book, who sat with the risk takers on the trading desk. (http://www.icmrindia.org/casestudies/catalogue/Finance/Collapse-Amaranth%20Advisors-Case%20Studies.htm#Risk_Management)The risk managers were well qualified and had advance degrees. Paul Touradji, founder and managing partner of Touradji Capital Management, said was obvious about risk control and not about commodities. Touradji admitted that he exited the natural gas market for a year because Amaranth had entered the market, comparing its presence with that of well-financed poker player sitting down with poorer players and making big bets. I cant think of a right counterstrategy other than to say, I am going to be at the bar until youre done, Touradji said. (http://www.hedgefundintelligence.com/Event.aspx?ProductID=7035ElementID=4983, 2006) Problems Diversification is the key element of all investment portfolios. It reduces the unsystematic risk of instability in any part of the economy. Amaranth specialized in the natural gas industry so much that it failed to realise that if it took any incorrect venture at any point in time, it would not have to face severe consequences. This is counted as a factor of poor risk management. One of the biggest issues with hedge funds is that there is lack of transparency for investors and they have no idea as to what the fund is doing with their money. Most hedge funds make money with the performance fees that are generated when the fund achieves larger gains; the bigger the gains the larger the fees for the hedge funds. If the funds stays still or falls, the performance fee is exactly the same. This type of fee structure can force hedge fund traders to implement exceedingly risky strategies. Much of the blame for what happened to Amaranth is being put on Brian Hunters, although he had a strategy, experience and understanding in the natural gas market; which worked well with various weather shocks, but the fund manager failed to take into account the rise in storage capacity of natural gas. The arrival of a relatively warm winter did not raise the demand of natural gas as much as in the previous years. These factors did not increase the price of natural gas as much, thus creating problems for Amaranth which has a long position. Amaranth was operating on a high leverage. As told earlier, Amaranth was operating on an 8:1 of debt to equity ratio. This amplified the credit problems for Amaranth because once it started facing liquidity problems; it ran out of cash to maintain its cash flows. After its collapse but before liquidating, Amaranth placed restrictions on its investors to withdraw holdings of cash. That is, they were allowed to withdraw for certain number of days but were required to submit the amount before the end of the term because inability to do so resulted in a penalty. Investors were not allowed their savings beyond 7.5% of their savings. (MORGENSON ANDERSON, September 20, 2006). The bankruptcy of funds causes damage to a number of individuals and companies that have their stake with them. In the Case of Amaranth, Morgan Stanley, invested $126 million, or about 5 percent, of its $2.3 billion funds of hedge funds in Amaranth. Even New York Fed Governor Timothy F. Geithner warned that hedge fund failures could hurt market participants other than those investors and lenders who have chosen to do business directly with those funds. (Mufson, 2006). This is because the instability created in the market (because of the bankruptcy of the company and the loss of a lot of people) can result in a systemic risk, which influences other sectors as well. It is commonly said that Amaranths systems did not measure risks correctly and did not take steps that would reduce the risk. The risk models that were employed by hedge funds use historic data, but the natural gas markets in 2006 were more volatile than any other year since 2001, making models less useful. A managing director of Lyster Watson Co, an advisory firm that invests in hedge funds for clients but not with Amaranth said, It was a total failure of risk control to put your entire business at risk and not seem to know it. They were more leveraged than they realised. (Davis, Sender, Zuckerman, 2006). Lessons to be learnt Derivatives as we know are risky sources of investments, and there a number of lessons that one can learn from the incident of Amaranth. Before making an investment (esp. in sector fund) it is important to analyze the performance of the sector relating to the profits and losses, during the past few years. A monthly sector analysis reveals that a -24% monthly loss is normal and the monthly volatility of the energy strategies was around 12% (Till, 2006), therefore due consideration should be made by investors before investing in such an industry. The second factor that fund managers should consider is of marketability or liquidity, which is the ease with which the contracts can be sold into the market again. The exchange traded futures market of natural gas contracts is way smaller than the over-the-counter natural gas positions. This should put the question in investors minds that in case the market of natural gas declines so how will they sell their contracts and liquidate their position. The strategy of Amaranth did not include an exit strategy. The following case of MotherRock also proves this point. Before the fall of Amaranth, on August 2, 2006 MotherRock, a natural-gas-oriented hedge fund had announced that it was shutting down, its losses had reached up to $300 million; it had made a wrong short position and was therefore forced to liquidate due to mounting losses. This should have sent alarming bell to the investors in Amaranth to secure their position in the market and they make sure that the dont face liquidity risk in near future (liquidity risk explained later). All successful investors have an exit strategy as part of their main strategy; liquidity is one of the four core factors to consider when investing in the market, these factors are risk, return, liquidity and maturity. Liquidity risk includes the risk that liabilities cannot be met when they fall due and can only be met at an uneconomic price. This risk can be accounted for by widening the bid/offer spread. An institution might lose liquidity if its credit ratings fall, it experiences sudden unexpected cash outflows or some other event that causes the counterparties to avoid trading with or lending to the institution. A firm can also be exposed to liquidity risk if markets on which it depends are subject to loss of liquidity. Liquidity risk tends to compound other risks. If a trading organization has a position in an illiquid asset, its limited ability to liquidate that position at short notice will compound its market risk. Suppose a firm has offsetting cash flows with two different parties on a given day. If the counterparty that owes it a payment defaults, the firm will have to raise cash from other sources to make its payment. Should it be unable to make its payment, it will default too. Here liquidity risk is compounding credit risk. A position can be hedged against market risk, through diversification of the portfolio by including assets with different unsystemic risks, but still has liquidity risk. Amaranths investments were high-risk funds that lacked liquidity due to the nature of the natural gas futures market. They did not have any counter party to take their position under a week, when they needed it most. One reason that can explain this liquidity problem is that the counter parties had already locked their position in the forward contracts relating to production or storage. It seemed that due to their past experience, of success in assuming long position in winters and short position in summers, Amaranth failed to anticipate the liquidity risk they were getting into by being unable to find a counter party. (Till, 2006). This was the job of the funds risks managers to employ scenario analysis based on this past events. Taking all the factors mentioned above proves that Amaranth was taking immense risk with respect to liquidity. Amaranth was giving the natural gas comodity market a service by providing liquidity to the participants who cou

Essay --

Michael Jackson Michael Jackson was a very charismatic, influential individual. He took the world by surprise as his long, successful career blossomed at such a young age. Throughout his many years of hard work, and unparalleled performances, he changed the world with his music. He became one of the most popular recording artists, delivering his sweet, funky tones, smooth dance moves, and versatile music capabilities across the world. He was a legend that continues to influence other musicians, as well as his large, loyal fan-base, and is well-deserving of the title of â€Å"The King of Pop† Michael was born on August 29, 1958 in Gary, Indiana. He lived with his 5 siblings, and his Parents. The Jackson family was poor, but managed to get by in their little house on, coincidentally-named, Jackson St. The Jackson brothers were born into a musical life. Their father, Joseph had previous musical experience with his blues group, The Falcons. Unfortunately their career did not take off, and they eventually broke up. Joseph saw something in his children. He saw what they were capable of, musically, and in the early 1960’s formed a group with Michael’s three older brothers, Jackie, Tito, and Jermaine known as, â€Å"The Jackson Brothers†. Michael at a very young age was influenced by artists such as Sammy Davis Jr., Smokey Robinson, and James Brown. At the age of only five years old, his mother would watch him singing and dancing along to old James Brown 45s, and she knew there was something special in him. (Jackson, â€Å"Michael Jackson: The Life o f an Icon). Michael was presented to his brothers and father, and was a quick addition to the Jackson’s musical group, taking over his brother, Jermaine’s position as lead singer. Joinin... ...o come. â€Å"If you enter this world knowing you are loved and you leave this world knowing the same, then everything that happens in between can be dealt with.† - Michael Jackson Jackson, Michael. Moonwalk. Crown Archetype, 2009. Print. "Triumph & Tragedy: The Life of Michael Jackson." Rolling Stone, n.d. Web. 16 Jan. 2014. . "Michael Jackson." Billboard, n.d. Web. 16 Jan. 2014. . Michael Jackson: The Life of an Icon. Dir. Andrew Eastel. Universal Pictures, 2011. DVD. Torribio, Sarah. "The Man in the Mirror: Jackson's skewed self-image." Examiner, 1 July 2009. Web. 17 Jan. 2014. . This Is It. Dir. Kenny Ortega. Sony Pictures, 2009. DVD.

Buying an Existing Website :: Sell Website

Buying an Existing Website Have you considered being your own boss, creating your own financial independence and making your own dreams a reality? You're not alone, owning your own business is the "American dream". But the reality is that buying a business is a serious financial and personal commitment that requires an understanding of what makes a business successful. All too often, new owners jump blindly into a business venture, overwhelmed by the tremendous workload of starting a business from the ground up. A government survey shows that 60% of new businesses fail within the first three years. An existing, established business that is purchased by a new owner shows a minimal failure rate. If you have considered the thought of owning your own business, buying an existing business has many advantages over building a business from scratch: You can review actual operating results, rather than projected results. You get immediate cash flow from the ongoing business activities. You will have trained employees in place. You will have established suppliers. You will have established customers and referral business. You will have existing licenses and permits. The seller will train you in operating the business. In most cases, the seller will provide the financing you need to buy the business. SUNBELT Business brokers know the reasons a good business succeeds. SUNBELT itself is a franchise that ranks number one in the business brokerage industry. SUNBELT has over twenty years of matching the right business opportunity with the right buyer. It's that simple. From understanding the reasons an on-going business can provide a positive cash flow, to the value of an established name, location and customer base to the inner workings of new owner financing and sealing the deal - SUNBELT can make your dreams reality. With the right negotiations, a business can actually pay for itself - let SUNBELT show you how. Confidentiality Unlike the sale of real estate or franchises, the sale of an on-going business is very confidential for both the seller and the prospective buyer. All inquiries are held in strict confidence. Meetings and information shared or observed are to be held in strict confidence. To ensure confidentiality for all parties, SUNBELT brokers require a confidentiality agreement to be signed. In return for granting you, the prospective buyer, access to investigate the operations of the seller's business and otherwise private information, the prospective buyer promises to use the information for the sole purpose of evaluating the benefits and risks of purchasing the seller's business in strict confidence.

Changing Use Of Language :: essays research papers

I chose to find the entomology of a word that most people can usually not go through a day without using at least once, computer. With the explosion of the personal computer in the last ten years, most households in America own at least one. However, the meaning of the word "computer" has changed in the last century. The word itself is found in text as far back as 1646 when Sir T. Brown said, "The calendars of these computers." The use of "computer" in this sense, as defined by the OED, is one who computes; a calculator, reckoner; a person employed to make calculations in an observatory, in surveying, etc.Then, around 1897, the use of "computer" began to change. In the January 22 edition of Engineering, this usage appeared: "This was... a computer made by Mr. W. Cox. He described it as of the nature of a circular slide rule." This usage began the change of the definition. In the supplement to the OED, "computer" is now defined as a calculating machine; an automatic electronic device for performing mathematical or logical operation.The word "computer" stems from the verb "compute" which came from the French comput-r and the Latin computa-re. It was formed by adding com - together and putare - to clear up, settle, reckon. Together, "compute" means to estimate or determine by arithmetical or mathematical reckoning; to calculate, reckon, count. Then from the word "compute", the suffix "er" was added giving us the definitions we have for computer today.2) In an effort to further understand language, the field of psycholinguistics formed to study the psychological side of language. Language has many different functions such as communication, expressing emotion, explaining ideas, to create relationships, and recording ideas. Without the use of language, it would be nearly impossible to explain the history of anything. Language allows for the communication that is necessary for survival. It is not only humans who benefit from language either. Bees use a complex system of a dance and buzz to show the hive where to find food, and birds use different chirps to communicate.One psycholinguistic, Hockett, said that all languages have some aspects that are the same at some level which he called Linguistic Universals. One aspect of Linguistic Universals is the broadcast transmission, which says that language is public and that anyone around the message will pick it up. Another aspect of language is that it is rapid fading, or if you don't get it right away, you won't get it at all.

Breeder’s Own Pet Foods, INC Essay

Central issue: Breeder’s Mix is a new kind of dog food and it is totally differ from traditional types dog foods, people are not familiar with this product at all. In addition, it is very difficult to predict the trend of this product. Dog food industry is considered highly potential in a mounting trend. Firstly, the dog food industry has benefited from increasing dog ownership. Secondly, pet owners continue to invest their animal companions with human qualities. Thirdly, the premium and superpremium dog food is increasing. Supermarket distribution is focused on the single largest retail channel for dog food and Boston market is ideal for launching a new dog food. There are about 50 dog food manufacturers and 350 dog food brands in the US. 5 of them accounted for 75 percent of the market share. The company is supposed to face a series of problems introducing the Breeder’s Mix to the general market, mostly due to its new form of the packaging. In addition, the price is also a big issue to be considered. Solutions: When entering the retail market, the market segment that Breeder’s Mix should be high and dog raisers who would spend more on their dogs than those dog owners who buy dry/canned/treats. The description on potential buyer scope is too large, and it can be narrowed down to niche group among those purchase expensive dog food buyers. According to the case, we can find that Boston market has a large potential. We suggest the entire campaign should be designed to accommodate product introduction inside the Boston market area. So the campaign can affect not only Boston but also the area near Boston. It’s a good preparation for our next step for geographic market extension. Recommandation: We think that target market is the most important. We segmented where  Breeder’s should be. And When it entering the retail market, we can find our position. And in this position, we can use good strategies to get more market share in Boston Market.

My Terror

My ambition of life Introduction:- NO one in this world is without dreams in life. Everyone has is own dream in Fife. Many have an aspiration to be a rich one or to become business tycoon. Some person have a dream of becoming leader,application & social reformers. Their are others who has a crazy for becoming poets,writers & novelists. While most of us generally have a desire of becoming engineers,doctors,scientist of a great repute. But some have a opinion to be commissioned officers in the Armed forces.There are fewer & fewer people who are happy-go–lucky†by nature & have no clear cut aim in their life Importance:-AS for myself, I don ‘t have very ambitious aims in my life. ‘ don ‘t wish to became a mill owner or a multi-millionaire. The soul object of my life is to lead a life of simplicity ; oddness devoted to the service of humanity. The life of a professional leader ; a plantation leader does not interest me because most of such persons are grown parasites in the society. Our society also dislike ARISTOTLE said â€Å"THESE applications are Just like â€Å"demagogues† mean a cruel & black bird like vultures have preying eyes.Different aims:- I born of middle class parent's. From the very begging I have been passing through the struggles of life . 1 have cut throat competition in most of the profession . Let's consequences have been far reaching. People demoralized. Examples are not wanting when we can find every engineers excepting very big bribes,lawyers saving guilty persons or murderers & doctors are demanding money from patients at crucial stages of surgical operations Choice of profession:- Then what do I want to be?Indeed,from the core of my heart,' wish to become a teacher. The motto of this life s simple living & high thinking,which inspire me to take up this profession. The noble ideals of the teacher in the ancient time or before me. As I am fully aware of difficulties & hardship off teacher life. ‘ kn ow that a teachers are on the bleating graph of poverty in the past,But I now if he is not a wealthy person then he is not depicted to anyone . Elf he has not luxurious life then on the other he can easily can meet out the basic needs of life.A teacher is always busy in correcting answer book or exercise books of students but along with this as a result of continuous research n education, the role of the teacher is only of a supervisor & a facilitator in the innovation methodologies & strategies. Len short there are no stirring event in his life. Teacher is a bank of respect & prestige in every nook & corner of the street in the shape of student. ‘spite of these hardships,' don ‘t have any aim but only to become a teacher. ‘ have my own reasons & considerations for this choice. From my childhood,' have developed of a love for young children's .To me, they are delicate & beautiful like the petal of a flower. Feel that as a teacher, I can help the students in widenin g their outlook by giving them a treasury of knowledge . 1 will have the satisfaction of doing valuable service to country by producing egoistic citizens. Moreover,the company of the young children's can even help me in remaining young & fresh I thought & out-look. Conclusion:-Besides doing all these important services I will also have the mean of consistency. ‘ have a great faith in life of noble & ideal teacher,because teachers are the custodians off highest value Essay on Terror By machineries