Electric Cars Are Going to Be the Future Essay Example for Free

Electric Cars Are Going to Be the Future Essay Nearly every household in America owns a gas powered vehicle, which pollutes our environment daily. Our society needs to consider furthering its knowledge and use of electric cars. Pollution of our environment must come to a halt in every situation possible in order to save the future of our atmosphere. I believe that the switch from gas-powered cars to electric cars is a very necessary and reasonable approach to save the environment. Several different car manufacturers have already began making efforts to adapt their vehicles to become more environmentally safe products. Although our country runs off oil and its proceeds, we can still attempt to make conversions that will lead to an overall positive impact on the United States. Making the switch to electric cars that run solely on renewable energy is a very wise economical and green decision. Our environment is long overdue for help in making it a better place for living in. The way we plan to make the environment better for living is by eliminating pollution altogether. The world annually emits approximately 8. 3 billion tons of carbon and about four billion tons will remain in the atmosphere for thousands of years. The switch to electric cars is an easy accomplishment because the technology is already at the tip of our hands. The United States will benefit a great deal after the switch from gasoline cars to electric cars is achieved. After learning the facts, the reasons are oblivious as to why electric cars are more efficient than hydrogen cars. The technology is already prepared for mass production. The negative environmental effects of production and driving the car are minimal. Manufacturers have already succeeded at innovating designs and specific features into the vehicles to assure the public’s satisfaction. With all of this in mind, it is vital to realize that the main goal of individual transportation is to enable people to get where they need to be when they need to be there. Ideally, there should be extremely limited environmental consequences when transporting in a perfect world, there would be none. Therefore, engineers and car manufacturers are not fixing the problem as a whole with their efforts to revolutionize automobiles, but every step forward counts. Instead of being content with the advancements, car manufacturers and engineers should continue to explore the world of environmentally safe opportunities to bring forward into the public eye. One of the most widely known alternatives to gasoline in America is hydrogen or biodiesel. Some might argue that hydrogen-powered or biodiesel-powered cars are more efficient than electric-powered cars, but they are not even close. Hydrogen cars are more expensive to fuel. The hydrogen car costs about three dollars per gallon, which totals around fifteen cents per mile, while the electric car pays in kilowatt-hours, which totals about two cents per mile. The average hydrogen car costs about one million dollars and the technology is just not there yet. It would cost excessively much to install hydrogen fueling stations and biodiesel pumps when it would be much easier and more reasonable to install a greater amount of electrical outlets across the world. Although, electric cars are more expensive to buy off the dealership lot they outperform the regular gasoline cars physically and economically. The electric car overall is cheaper to maintain, but unfortunately, after about ten years the lithium ion batteries start to drain out, but instead of buying a brand new car every so many years all you would have to do is replace the batteries. In the end, this will be a very good deal. The electric alternative technology is already here compared to other alternatives like ethanol, biodiesel, and hydrogen, yes, these are all great ideas, but the technology is just not readily available to us. Therefore, we should not even bother with these alternatives at all. Lastly, the gasoline cars that we use today waste power by constantly burning gas when the car is not in motion, whereas electric cars do not waste power when the car is not in motion.

An Analysis of Data On Rape Crimes

An Analysis of Data On Rape Crimes Introduction I will comment on the value of data and highlight advantages and disadvantages of this data and finally and come up with appropriate business actions that could be taken and enable Russex constabulary to help prioritise their work. Methods of data collection Official statistics are those published by the central Government. This source of statistical information informs the general public about the extent of notifiable offences. Official statistics are easy and cheap to access as you can observe them on the Home Office web page. The second source of statistical information comes from the British Crime Survey (BCS). These statistics are unofficial and the procedures used to gather information are completely different to the first, as the statistical data comes from surveys carried out by the public themselves. The statistics given are based on a large representative sample of the general public about their experiences as victims of household and personal crime. The BCS endeavours to provide a count of crime that consists of episodes not reported to the police, therefore examining the dark figure of crime which is not recorded in official statistics. The British Crime Survey (BCS) is a large random survey of private households, designed to give a count of crime that includes incidents not reported to the police, or those reported to them but not recorded. The main BCS interview takes place face-to-face, with no gender matching of interviewer and respondent. This context is not conducive to accurately measuring levels of highly personal victimisation. Estimates of the level of sexual victimisation obtained by the main BCS are acknowledged to be underestimates Consequently, the survey now makes use of Computer Assisted Self-Interviewing (CASI), whereby respondents keyed their responses into a laptop computer themselves. This method provides respondents with an increased sense of confidentiality and minimises interviewer effects. Respondents who answered the self-completion modules were routed through a series of three screener questions, designed to identify whether or not they had been a victim of a sexual offence. If they responded positively to one or more of these, they then answered a series of follow-up questions, designed to elicit the exact nature of the last incident experienced. Data as a management tool Data collection is practical because you cannot manage what you do not measure. Statistics from data enables a police department to make smart judgments and assists them in possibly identifying department and procedural problems. Data collection is also a great gesture to the community, showing law enforcement has the willingness to take an inward look to prevent discrimination. It also displays a true commitment by law enforcement to address community concerns and needs. Data collection gives everyone something to work with even though it might be just a partial solution. With mandatory data collection, officers will be forced to think about what happens during an encounter and what they do and say and possibly what parts should be looked at closer. Data collection provide a basis for important policy changes. Statistical techniques Line Graph A line graph is most useful in displaying data or information that changes continuously over time. The example below shows the Rape of a female from 1993-2005/06 Some of the strengths of line graphs are that: They are good at showing specific values of data, meaning that given one variable the other can easily be determined. They show trends in data clearly, meaning that they visibly show how one variable is affected by the other as it increases or decreases. They enable the viewer to make predictions about the results of data not yet recorded. Unfortunately, it is possible to alter the way a line graph appears to make data look a certain way. This is done by either not using consistent scales on the axes, meaning that the value in between each point along the axis may not be the same, or when comparing two graphs using different scales for each. It is important that we all be aware of how graphs can be made to look a certain way, when that might not be the way the data really is. Rape of a female Long-term national recorded crime trend he rate of rapes on females during this period has dramatically increased (see above). Leah Williams from the Womens Resource Centre stated that there were 1,842 rapes reported in 1985, compared to 14,449 in 2005. There may be a good explanation for this trend. Research by feminist scholars Hanmer and Saunders (1984) cited in Goodey (2005) found that everyday reality of womens encounters of violence by men were not revealed in the BCS because the BCS is not designed to reveal such information. Therefore the number of rapes on females may not have increased during this period, but the number of reports to the police has increased. This suggests that rapes which may have occurred prior 1995 are only being reported to the police in the last decade. This may be due to the social construction of the police changing. There are more female officers now than previously which makes rape victims more willing to talk to female officers than male officers. Society has also changed in order to pr ovide more victim support for rape victims by establishing rape centres for victims. However, Hough (2004) stated in the Guardian newspaper that the BCS shows that the major types of crime have fallen dramatically since 1995, however, recorded crime has increased. This increase is due to the change in the way in which police count crime. In 1998 it was decided that victim reports of crimes will be recorded even if they are doubted. This may be an alternative reason to why there is an increase in rape crimes, as rape is hard to record without sufficient evidence. Reservations over data How accurate are the estimates? Unreported rape may feel that the government cannot do anything about it There are several reasons why the BCS self-completion modules are likely to underestimate the true level of sexual victimisation in England and Wales for women à ¢Ã¢â€š ¬Ã‚ ¢ general survey errors associated with response, sampling and coverage in particular, the BCS does cover institutions, the homeless or women under the age of 16, which excludes some high risk women à ¢Ã¢â€š ¬Ã‚ ¢ the crime context of the BCS may lead to some women not reporting incidents they do not view as criminal, particularly where the perpetrator is known à ¢Ã¢â€š ¬Ã‚ ¢ the screener question format will exclude women who do not identify with the particular terminology used in the questions à ¢Ã¢â€š ¬Ã‚ ¢ the BCS interview is not always conducted in private and the presence of other people in the room may inhibit disclosure, especially if this includes the perpetrator of an attack. Conclusion actions and recommendations Sexual offence statistics could be improved by enhanced police procedures, and by having better facilities to encourage a greater willingness of victims to come forward. The sexual crime reduction team are committed to tackling sexual offences and to providing the right support for victims. Better facilities have been introduced through the introduction of 13 sexual assault referral centre across the country. The Government want to make these multi agency services for victims available on a national basis, along with a rape help line. Low reporting rates to the police particularly occur in the area of rape, where the respondent might find it embarrassing or difficult to talk about the attack. However, this problem is trying to be countered out. Computer assisted self-interview forms have been introduced for issues such as sexual attacks. Even so much of this area of offences is still missed as victims might want to stay in denial, and keep the fact that they have been a victim of a sexual assault within their sub-conscious, due to finding it to painful to think about. Further specialist training for sexual offence cases should be undertaken by officers. As a result of these services, victims should feel more confident from the outset that their case is treated with professionalism and empathy. In turn, it will improve theirs and others confidence in the criminal justice system. Ultimately, this enhanced approach should lead to more reporting, recording and subsequently more realistic statistics. Offer tips for rape prevention. Wider use of rape clinics, and awareness of these.

Reproductive Fantasy is Burning :: Fire Novels Literature Fantasy Essays

Reproductive Fantasy is Burning Of fire, what can be written that would not be better off singed, immolated, baked, or outright burnt? Flame of the match lights a watch. Dancing embers of destruction hide records, burn bodies and papers. Glistening radiance of torches light the way through the night of Victorian horror and fantasy. Fire is lively (it breathers, it takes in, it puts out, it moves, it grows, and it makes more) yet takes away life (defined by the same characteristics.) Everywhere it is fire. Suddenly, away on our left I saw a faint flickering blue flame. The driver saw it at the same moment. He at once checked the horses, and, jumping to the ground, disappeared into the darkness. I did not know what to do, the less as the howling of the wolves grew closer. But while I wondered, the driver suddenly appeared again, and without a word took his seat, and we resumed our journey. I think I must have fallen asleep and kept dreaming of the incident, for it seemed to be repeated endlessly, and now looking back, it is like a sort of awful nightmare. Once the flame appeared so near the road, that even in the darkness around us I could watch the driver's motions. He went rapidly to where the blue flame arose, it must have been very faint, for it did not seem to illumine the place around it at all, and gathering a few stones, formed them into some device. Once there appeared a strange optical effect. When he stood between me and the flame he did not obstruct it, for I could see its ghostly flicker all the same. This startled me, but as the effect was only momentary, I took it that my eyes deceived me straining through the darkness. Then for a time there were no blue flames, and we sped onwards through the gloom, with the howling of the wolves around us, as though they were following in a moving circle. Deception from the eyes, hoarding of the light by the intensity of a blue flame, repetition of unqualified flickering fire. The undead Dracula is fiercely alive, in his metabolism, reproduction and movement. Making his rules and carving his possibilities for life, inasmuch as he has agency to begin with, it is one which forms and informs its own possibility.

The Incredibly Usable Cattail :: Botany

The Incredibly Usable Cattail Is it possible that cattails were the reeds in which baby Moses was hidden? Their range does include nearly all the continents. And even though cattails are wide ranging, commonly known plants, few know of their versatility. Nearly the entire plant can be eaten, excluding the leaves. Cattails were used many different ways medicinally, from a topical ointment to an internal remedy. The plants have also been used in a wide variety of miscellaneous purposes. Mostly, they have been used for weaving, but they also have been used for filling and more (Coon 1960). Although taxonomists have historically had trouble defining a couple species, North American cattail nomenclature is fairly straightforward. Cattails are monocots of the order Typhales, subdivided into two families: Sparganiaceae or the bur-reed family and Typhaceae. Typhaceae, the cattail family, is comprised only of the genus Typha. Four species of Typha occur in North America. The four North American cattails are: T. latifolia, T. angustifolia, T. glauca, and T. domengensis. T. latifolia has a range including Europe and Asia (Mohlenbrock 1970). In North America, it ranges widely from Alaska, through Canada, throughout the U.S. and into Mexico (Hotchkiss & Dozier 1949). It is common in every county in Illinois (Mohlenbrock 1970). T. angustifolia grows in Africa, Europe, and Asia (Mohlenbrock 1970). In North America, it ranges from the Northeast to the Midwest and also California (Hotchkiss & Dozier 1949). In Illinois it occurs throughout most of the state (Mohlenbrock 1970). Besides North America, T. qlauca and T. domengensis are also found in Europe. These two however, do not occur in Illinois. In the U.S., T. glauca ranges from the upper Midwest and Northeast down the Altantic coast to Florida and into Alabama. It also occurs in California. T. domengensis, being well adapted to brackish waters, grows along the coast from Delaware to Mexico and also occurs in the Southwest. Many common names are used for cattails. T. latifolia goes by the name broadleaf cattail, common cattail and soft flag. T. angustifolia has been called narrow leaf cattail and nail rod. Blue cattail and blue flag describe T. glauca. T. domengensis is commonly known as southern cattail. Other names include flagtail, marsh beetle, blackcap, water torch and candlewick, cat-of-nine tails and reed mace (Coon 1960). Some Native American names have been translated as prairie chicken feathers, eye itch, and roof grass. Typha's wide range can be accounted for by several features both physiologically and anatomically.

Diabetes Mellitus Essay -- Disease, Disorders

Diabetes mellitus (DM) or simply diabetes, is a chronic health condition in which the body either fails to produce the amount of insulin needed or it responds inadequately to the insulin secreted by the pancreas. The three primary types of diabetes are: Diabetes Type 1 and 2, and during some pregnancies, Gestational diabetes. The clichà © for all three types of diabetes is high glucose blood levels or hyperglycemia. The pathophysiology of all types of diabetes mellitus is related to the hormone insulin, which is secreted by the beta cells of the pancreas. This hormone is responsible for maintaining an optimal glucose level in the blood. It allows the body cells to use glucose as a main energy source. Due to abnormal insulin metabolism, in a diabetic person, the body cells and tissues cannot make use of glucose from the blood, resulting in elevated blood glucose level or hyperglycemia. Over time, elevated blood glucose level in the bloodstream can lead to severe complications, such as disorders of the eyes, cardiovascular diseases, kidney damage and nerve destruction. In Type 1 diabetes, the pancreas is not able to produce sufficient amount of insulin as required for the body. The pathophysiology of type 1 diabetes suggests that it’s an autoimmune disease, in which the body’s own immune system generates secretions of substances that attack the beta cells of the pancreas leading to low or no insulin secretion. This is more common in children and young adults before the age of thirty. Type 1 is also referred as Insulin dependent Diabetes Mellitus or Juvenile Diabetes, exogenous insulin is needed for its treatment. In type 2 diabetes mellitus we find insulin resistance with varying degrees of insulin secretory defects and is more comm... ... advice to wear comfortable shoes, preferable leather, and not to walk barefoot. Maintaining proper weight and exercising regularly is essential. Early and correct detection of the type of diabetes is necessary to prevent severe health complications. Reference List Bernstein, R. (2007). Dr. Bernstein’s diabetes solution, New York, Little, Brown and Company Becker, G. (2011). Type 2 diabetes, New York, Marlowe & Company Khardori, R. (2011). Type 1 Diabetes Mellitus. Retrieved from http://emedicine.medscape.com/article/117739-overview Retrieved from http://www.mayoclinic.com/health/type-1-diabetes/DS00329/DSECTION=ca 1998-2012 Mayo Foundation for Medical Education and Research (MFMER). By Mayo Clinic Staff Silvestri, L. (2010). Comprehensive review for the nclex-pn examination Saunders; 4 edition Linda Anne Silvestri (March 5, 2009)

Primary Sources of Boston Massacre

The Boston Massacre- March, 5, 1770 Part One: Document| Author| Date| Purpose| Biases| The Legal Papers of John Adams, No. 64, Rex v Wemms| John Adams| 1755-1784| To record what he heard and saw during the trial and how he defended for the British soldiers. | Despite the fact that most eyewitnesses’ testimonies denounced Captain Thomas Pretson ordering his men to fire upon the citizens, he believed these people were biased and words aren’t 100% reliable. Anonymous account of the Boston Massacre March 5 1770| Unknown| Unknown| To briefly explain what caused the people to rise up against the soldiers and how reluctant the citizens were. | He did not feel that the patriots were any faulty of the soldiers’ fire. He felt unfairly treated and thought the soldiers pushed way too far by abusing the locals with their power. | The Account of The Boston Massacre| The Boston Gazette and Country Journal| March 12, 1770| Reporting what happened on the day of massacre on the ne wspaper for locals to read. The article described the scenario as a massacre due to the anger of some upset British troops who felt being insulted. It obviously accused Captain Preston. | The Bloody Massacre (Photo)| Paul Revere| 1770| His painting depicted what happened on the day of March 5th 1770. | He exaggerated the scenario by painting the soldiers in cruelty that aimed into the innocent helpless unarmed white men. Truth is, the main victims in the massacre were black and they were throwing snowballs at the soldiers. He wanted to make it look as angry as it could be to make the audience think it as a deliberate murder. Captain Thomas Preston’s Account of the Boston Massacre| Captain Thomas Preston| October 24, 1770| To explain about what he perceived on March 5th and to swear he never intended for anyone to get hurt nor did he order the troops to fire. | He believed the townspeople were all mad and tried to bring up a riot to prevent themselves from being punished for i nsulting the troops. Although he did think the firing was a terrible thing the troops done, he thought it could have been necessary in order to guard the King’s vessel efficiently. The Deposition of Theodore Bliss| Theodore Bliss| Unknown| To be a witness defending Captain Preston, affirming that he did not order the men to fire. | He was at the sight because of the fire alarm. What he described as may have heard or seen may not be of words in favor of any side but he could have been so busy analyzing the situation or looking for the possible fire that struck the alarm and missed out when Captain Preston gave orders. He could have been too nervous to remember everything that happened that day. | Part 2: It’s a well-known event.Everyone knows why it happened, who were involved, and where and when it happened, but does everyone know how it happened? The truth has sunk to the deepest point in the sea and remains as a mystery in history of the United States of America. Wha t really caused the townspeople’s temper to explode that lead to the Boston Massacre? Different people from different aspects varied in their description of the event. An anonymous victim of the Boston Massacre wrote about what harsh environment the citizens were living in prior the event and what happened that day.Typical high school history textbook mentions the high tax rate of all the products during the late 1700s, which has been explained as the reason why the citizens rise against the British government. However, although he did write about how the Stamp Act upset them and about the violation of Magna-Carta for the Commission to send troops over, something happened during one day of March that really boosted their anger level. He talked about a boxing match that the soldiers commanded the workers of Mr. Gray’s ropewalk to participate in. One soldier was defeated by Mr.Gray’s worker and went back to recruit his army friends to come back and challenge. He a lso included Samuel Drowne’s testimony of him and some neighbors being abused by the British troops in the evening that seem to be an act of revenge for the embarrassment of the match early on before the massacre. This article has tons of information about what happened that day. It is a very useful source because his words and feelings were common with his neighbors who were angry at the troops too. Through his voice, one can hear the cries and complaints of the townspeople of Boston.However, this is only one side of the story and putting all the faults on the British troops for firing doesn’t seem very convincing. Captain Thomas Preston, the commander of the soldiers who fired their muskets at the townspeople, talked about the different side of the story. He was aware that the residents and the soldiers didn’t get along but he said he never thought of using violence to solve the conflict. He declared that when his troops walked by Gray’s ropewalk on Mar ch 2nd, the rope-makers made fun of the soldiers and insulted them. After a moment of verbal fight (argument), they went into a nonverbal fight (action).Although the soldiers went back to their units afterwards, he said the inhabitants become arrogant and have been continuously abusing the soldiers. He explains that he was informed that the townspeople were up in front of the city hall beating up the troops. He went up trying to pacify the crowd but didn’t succeed. He said he kept shouting to the troops to hold their fire and had never intended to hurt anyone and he did not want to take account for what may happen. It’s convincing that he was innocent about the fight on the 2nd and did not want to fire because then he’ll just lose his job.However, his words aren’t accurate as well. It’s understandable how the townspeople thought of the troops as undesirable, but it’s hard to believe they had the power to abuse the armed soldiers. Preston is a commander, a soldier in a higher division; it is possible that he has not been reported with all the true words. No lower division personnel would tell his boss that he’s been abusing his powers. The troops beating the residents sounded more likely, the other way around seem very absurd. If he did command the fire, it would’ve been the most unwise decision in that situation.It is clear that he did have the chance to run away from being guilty of the command but he submitted himself. Whether he did or not call it, the massacre still took place. It was very hard to be a soldier of British crown while being the towns’ guard. To protect the crown and his property were the soldiers’ duties and residents are a part of that duty. It was hard to decide whether to protect the city hall that the inhabitants were threatening or harm to prevent them from destroying it. After all, they’re both the King’s property.He described the awful words and threat s the residents were speaking and how hard it was for him to ignore them and try to prevent from getting hit by the snowballs flying around, thrown by the citizens. He swore that he never commanded his men to fire. This could be true, but like I mentioned, the death under musketry still happened. The massacre could have started due to the soldiers’ misconception of the command. This brought up some reconsideration upon Paul Revere’s painting The Bloody Massacre, where the violent British soldiers blew tons of musket balls at the strength less citizens.The inhabitants were throwing snowballs at the troops and were clearly standing up for what they thought is right, not being beaten up like a bunch of farmed chickens. The troops did stop after a short while, possibly because of receiving the command of stop firing from Captain Preston. Bringing in a voice that sounded like a good-hearted soldier into the history textbook, like Captain Preston, would be nice because it ca n alter the stereotype of the fierce British soldiers, which heartlessly killed the townspeople, in a good way. The Boston Gazette and Journal about the massacre is another primary source of what happened on the event.Its version of the story is more convincing to many people because it’s a newspaper article, a piece of work that’s been viewed, edited, and published. However, like media nowadays, its purpose isn’t just to report the local news to people but to drag their attention into reading the article. Before talking about what’s happened that night, it gave a short disclaimer, â€Å"Our readers will doubtless expect a circumstantial account of the tragical affair on Monday night last; but we hope they will excuse our being so particular as we should have been, had we not seen that the town was intending an enquiry and full representation thereof. This little paragraph, apart from the introduction and the story of the event, dragged everyone’s attention, including me. It’s like saying that they wrote about whatever happened as is with no masking and no biases. It is not so. It said on Monday evening, before the massacre took place, the troops were on the streets abusing the inhabitants. One young man, John Hicks, came up against that mean soldier and knocked him down. The soldiers went back and brought back about 12 men and said a witness named Samuel Atwood claimed the soldier answered him that they were about to murder someone.The troop caught one young man and beaten him up, the lad fought back and ran towards Cornhill. The article mentions Captain Preston and his men pushing his way to the commissioner’s office with charged muskets. Then someone started throwing snowballs at the captain and he commanded to fire the bayonets. Neither the anonymous nor Preston himself claimed that he fired towards the townspeople. This article although described the event in detail does not seem very relevant. I am not su re why the 12 men beating the oung guy was not mentioned in either Preston’s account or the anonymous man’s, but it is likely that something similar to that may have happened. This newspaper article was published and surely was in great number of people’s hands. Its purpose was to gather people’s concern and sense of humanity towards the massacre. It wants people to feel hurt and abused and sense the evil of the power the government has in hand. No one knows for sure whether Captain Preston gave the command because there were testimonies both for and against him.However, this article was straightforwardly accusing him of being insolent and ignorant. That’s the image the paper wants people to have in mind. Like Revere, it wants people to picture the brutal government’s units beating innocent citizens up. Although having its agenda parallel to Revere’s, it did prove something that was deliberately painted otherwise in The Bloody Massacr e. Crispus Attucks, who was shot dead at the scene of the massacre, was a young black man, but his portrait in the painting was a white patriot.It was probably because white men being injured seemed rather crueler than black workers being slain. Both the newspaper editor and Revere knew that the more severe something is, the more attention it attracts. Untruthful as it may sound, it’s still a very useful resource overall. Because it made the situation sound so critical, people united and brought up the idea of the American Revolution. Though different primary documents during that time period had slightly different stories about the Boston Massacre, they all pointed to one doubtless fact: it is one of the great events that drawn to the American Revolution.It really is hard to tell which altered the story with their own words, who told the truth, or did all of them tell the truth due to their perception, they were all witnesses of the event and their words are very valuable. T hey all contributed to the American History. They all provided a reason for people to come together and think about their future and to decide whether they should do something to escape from that hopeless future.It’s nearly impossible to dig out the truth since there was no surveillance available at the time so let it be and remain an endless discussable topic for people who are interested in wondering what really was going on during the period of the Boston Massacre. Part 3: Work Cited Adams, John. Summation of John Adams. University of Missouri-Kansas City. 1755-1784. 20 Feb. Web. 2013 Bliss, Theodore. â€Å"Deposition of Theodore Bliss†. Boston Massacre Historical Society. Boston Massacre Historical Society. nd. Web. Feb. 21 2013 np. â€Å"Anonymous account of the Boston Massacre March 5 1770†.American History from Revolution to Reconstruction and Beyond. University of Groningen. nd. Web. 19 Feb. 2013 Preston, Thomas. â€Å"Captain Thomas Preston's Account o f the Boston Massacre†. Boston Massacre Historical Society. Boston Massacre Historical Society. 24 Oct. 1770. Web. Feb. 21 2013 Revere, Paul. â€Å"The Bloody Massacre†. History Matters. Library of Congress. nd. Web. Feb. 20 2013 The Boston Gazette and County Journal. The Boston Massacre, 5 March 1770: the Boston newspaper account. The Public Schools of North Carolina. 12 March 1970. Web. 19 Feb. 2013

Indian Banking Sector

A bank is an institution that deals in money and its substitutes and provides other financial services. Banks accept deposits and make loans or make an investment to derive a profit from the difference in the interest rates paid and charged, respectively. In India the banks are being segregated in different groups. Each group has their own benefits and limitations in operating in India. Each has their own dedicated target market. Few of them only work in rural sector while others in both rural as well as urban. Many even are only catering in cities.Some are of Indian origin and some are foreign players. India’s economy has been one of the stars of global economics in recent years. It has grown by more than 9% for three years running. The economy of India is as diverse as it is large, with a number of major sectors including manufacturing industries, agriculture, textiles and handicrafts, and services. Agriculture is a major component of the Indian economy, as over 66% of the I ndian population earns its livelihood from this area. Banking sector is considered as a booming sector in Indian economy recently.Banking is a vital system for developing economy for the nation. However, Indian banking system and economy has been facing various challenges and problems which have discussed in other parts of project. INDIAN BANKING SYSTEM Without a sound and effective banking system in India it cannot have a healthy economy. The banking system of India should not only be hassle free but it should be able to meet new challenges posed by the technology and any other external and internal factors. For the past three decades India's banking system has several outstanding achievements to its credit.The most striking is its extensive reach. It is no longer confined to only metropolitans or cosmopolitans in India. In fact, Indian banking system has reached even to the remote corners of the country. This is one of the main reasons of India's growth process. The government's r egular policy for Indian bank since 1969 has paid rich dividends with the nationalization of 14 major private banks of India. Not long ago, an account holder had to wait for hours at the bank counters for getting a draft or for withdrawing his own money.Today, he has a choice. Gone are days when the most efficient bank transferred money from one branch to other in two days. Now it is simple as instant messaging or dial a pizza. Money has become the order of the day. The first bank in India, though conservative, was established in 1786. From 1786 till today, the journey of Indian Banking System can be segregated into three distinct phases. They are as mentioned below: †¢Early phase from 1786 to 1969 of Indian Banks †¢Nationalization of Indian Banks and up to 1991 prior to Indian banking sector Reforms. New phase of Indian Banking System with the advent of Indian Financial ; Banking Sector Reforms after 1991. After 1991, under the chairmanship of M Narasimham, a committee wa s set up by his name which worked for the liberalization of banking practices. The country is flooded with foreign banks and their ATM stations. Efforts are being put to give a satisfactory service to customers. Phone banking and net banking is introduced. The entire system became more convenient and swift. Time is given more importance than money.This resulted that Indian banking is growing at an astonishing rate, with Assets expected to reach US$1 trillion by 2010. â€Å"The banking industry should focus on having a small number of large players that can compete globally and can achieve expected goals rather than having a large number of fragmented players. † KINDS OF BANKS Financial requirements in a modern economy are of a diverse nature, distinctive variety and large magnitude. Hence, different types of banks have been instituted to cater to the varying needs of the community.Banks in the organized sector may, however, be classified in to the following major forms: oComm ercial banks oCo-operative banks oSpecialized banks oCentral bank †¢COMMERCIAL BANKS Commercial banks are joint stock companies dealing in money and credit. In India, however there is a mixed banking system, prior to July 1969, all the commercial banks-73 scheduled and 26 non-scheduled banks, except the state bank of India and its subsidiaries-were under the control of private sector. On July 19, 1969, however, 14 major commercial banks with deposits of over 50 Corers were nationalized.In April 1980, another six commercial banks of high standing were taken over by the government. At present, there are 20 nationalized banks plus the state bank of India and its 7 subsidiaries constituting public sector banking which controls over 90 per cent of the banking business in the country. †¢CO-OPERATIVE BANKS Co-operative banks are a group of financial institutions organized under the provisions of the Co-operative societies Act of the states. The main objective of co-operative bank s is to provide cheap credits to their members.They are based on the principle of self-reliance and mutual co-operation. Co-operative banking system in India has the shape of a pyramid a three tier structure, constituted by: †¢SPECIALIZED BANKS There are specialized forms of banks catering to some special needs with this unique nature of activities. There are thus, oForeign exchange banks, oIndustrial banks, oDevelopment banks, oLand development banks, oExim bank. †¢CENTRAL BANK A central bank is the apex financial institution in the banking and financial system of a country.It is regarded as the highest monetary authority in the country. It acts as the leader of the money market. It supervises, control and regulates the activities of the commercial banks. It is a service oriented financial institution. India’s central bank is the Reserve Bank of India established in 1935. A central bank is usually state owned but it may also be a private organization. For instance, the Reserve Bank of India (RBI), was started as a shareholders’ organization in 1935, however, it was nationalized after independence, in 1949. It is free from parliamentary control.CHALLENGES FACED BY INDIAN BANKING INDUSTRY The banking industry in India is undergoing a major transformation due to changes in economic conditions and continuous deregulation. These multiple changes happening one after other has a ripple effect on a bank trying to graduate from completely regulated sellers market to completed deregulated customers market. oDEREGULATION This continuous deregulation has made the Banking market extremely competitive with greater autonomy, operational flexibility, and decontrolled interest rate and liberalized norms for foreign exchange.The deregulation of the industry coupled with decontrol in interest rates has led to entry of a number of players in the banking industry. At the same time reduced corporate credit off take thanks to sluggish economy has resulted in large number of competitors battling for the same pie. oNEW RULES As a result, the market place has been redefined with new rules of the game. Banks are transforming to universal banking, adding new channels with lucrative pricing and freebees to offer. Natural fall out of this has led to a series of innovative product offerings catering to various customer segments, specifically retail credit. EFFICIENCY This in turn has made it necessary to look for efficiencies in the business. Banks need to access low cost funds and simultaneously improve the efficiency. The banks are facing pricing pressure, squeeze on spread and have to give thrust on retail assets. oDIFFUSED CUSTOMER LOYALTY This will definitely impact Customer preferences, as they are bound to react to the value added offerings. Customers have become demanding and the loyalties are diffused. There are multiple choices; the wallet share is reduced per bank with demand on flexibility and customization.Given the relatively low switching costs; customer retention calls for customized service and hassle free, flawless service delivery. oMISALLIGNED MINDSET These changes are creating challenges, as employees are made to adapt to changing conditions. There is resistance to change from employees and the Seller market mindset is yet to be changed coupled with Fear of uncertainty and Control orientation. Acceptance of technology is slowly creeping in but the utilization is not maximized. oCOMPETENCE GAPPlacing the right skill at the right place will determine success. The competency gap needs to be addressed simultaneously otherwise there will be missed opportunities. The focus of people will be on doing work but not providing solutions, on escalating problems rather than solving them and on disposing customers instead of using the opportunity to cross sell. STRATEGIES OPTIONS WITH BANKS TO COPE WITH THOSE CHALLENGES Leading players in the industry have embarked on a series of strategic and tactical initiatives to sustain leadership.The major initiatives include: oInvesting in state of the art technology as the back bone of to ensure reliable service delivery oLeveraging the branch network and sales structure to mobilize low cost current and savings deposits oMaking aggressive forays in the retail advances segment of home and personal loans oImplementing organization wide initiatives involving people, process and technology to reduce the fixed costs and the cost per transaction oFocusing on fee based income to compensate for squeezed spread, (e. . CMS, trade services) oInnovating Products to capture customer ‘mind share’ to begin with and later the wallet share oImproving the asset quality as per Basel II norms INDIAN ECONOMY The Indian Economy is consistently posting robust growth numbers in all sectors leading to impressive growth in Indian GDP. The Indian economy has been stable and reliable in recent times, while in the last few years it’s experienced a positive up ward growth trend.A consistent 8-9% growth rate has been supported by a number of favorable economic indicators including a huge inflow of foreign funds, growing reserves in the foreign exchange sector, both an IT and real estate boom, and a flourishing capital market. All of these positive changes have resulted in establishing the Indian economy as one of the largest and fastest growing in the world. The process of globalization has been an integral part of the recent economic progress made by India.Globalization has played a major role in export-led growth, leading to the enlargement of the job market in India. As a new Indian middle class has developed around the wealth that the IT and BPO industries have brought to the country, a new consumer base has developed. International companies are also expanding their operations in India to service this massive growth opportunity. The same thing has followed by international banks that are entering in Indian market and pulling their hug e investments in Indian economy. This is helping to accelerate the growth of Indian economy.Economy can be studied from two points of views†¦ ?MICRO ECONOMIC POINT OF VIEW The branch of economics that analyzes the market behavior of individual consumers and firms in an attempt to understand the decision-making process of firms and households. It is concerned with the interaction between individual buyers and sellers and the factors that influence the choices made by buyers and sellers. In particular, microeconomics focuses on patterns of supply and demand and the determination of price and output in individual markets.Microeconomics looks at the smaller picture and focuses more on basic theories of supply and demand and how individual businesses decide how much of something to produce and how much to charge for it. ?MACRO ECONOMIC POINT OF VIEW It is a field of economics that studies the behavior of the aggregate economy. Macroeconomics examines economy-wide phenomena such as c hanges in unemployment, national income, rate of growth, gross domestic product, inflation and price levels. Macroeconomics looks at the big picture (hence â€Å"macro†). It focuses on the national economy as a whole and provides a basic knowledge of how things work in the business world.For example, people who study this branch of economics would be able to interpret the latest Gross Domestic Product figures or explain why a 6% rate of unemployment is not necessarily a bad thing. Thus, for an overall perspective of how the entire economy works, you need to have an understanding of economics at both the micro and macro levels. ECONOMIC SYSTEMS An economic system is loosely defined as country’s plan for its services, goods produced, and the exact way in which its economic plan is carried out. In general, there are three major types of economic systems prevailing around the world they are†¦ Market Economy oPlanned Economy oMixed Economy MARKET ECONOMY In a market ec onomy, national and state governments play a minor role. Instead, consumers and their buying decisions drive the economy. In this type of economic system, the assumptions of the market play a major role in deciding the right path for a country’s economic development. Market economies aim to reduce or eliminate entirely subsidies for a particular industry, the pre-determination of prices for different commodities, and the amount of regulation controlling different industrial sectors.The absence of central planning is one of the major features of this economic system. Market decisions are mainly dominated by supply and demand. The role of the government in a market economy is to simply make sure that the market is stable enough to carry out its economic activities properly. PLANNED ECONOMY A planned economy is also sometimes called a command economy. The most important aspect of this type of economy is that all major decisions related to the production, distribution, commodity and service prices, are all made by the government.The planned economy is government directed, and market forces have very little say in such an economy. This type of economy lacks the kind of flexibility that is present a market economy, and because of this, the planned economy reacts slower to changes in consumer needs and fluctuating patterns of supply and demand. On the other hand, a planned economy aims at using all available resources for developing production instead of allotting the resources for advertising or marketing. MIXED ECONOMY A mixed economy combines elements of both the planned and the market economies in one cohesive system.This means that certain features from both market and planned economic systems are taken to form this type of economy. This system prevails in many countries where neither the government nor the business entities control the economic activities of that country – both sectors play an important role in the economic decision-making of the country. In a mixed economy there is flexibility in some areas and government control in others. Mixed economies include both capitalist and socialist economic policies and often arise in societies that seek to balance a wide range of political and economic views. IMPORTANT BANKING AND ECONOMIC INDICATORS CASH RESERVE RATIO Cash reserve Ratio (CRR) is the amount of funds that the banks have to keep with RBI. If RBI decides to increase the percent of this, the available amount with the banks comes down. RBI is using this method (increase of CRR rate), to drain out the excessive money from the banks. The amount of which shall not be less than three per cent of the total of the Net Demand and Time Liabilities (NDTL) in India, on a fortnightly basis and RBI is empowered to increase the said rate of CRR to such higher rate not exceeding twenty percent of the Net Demand and Time Liabilities (NDTL) under the RBI Act, 1934. STATUTORY LIQUIDITY RATIO In terms of Section 24 (2-A) of the B. R. Act, 1949 all Scheduled Commercial Banks, in addition to the average daily balance which they are required to maintain in the form of†¦. oIn cash, Or oIn gold valued at a price not exceeding the current market price, Or oIn unencumbered approved securities valued at a price as specified by the RBI from time to time. ?REPO RATE Repo rate, also known as the official bank rate, is the discounted rate at which a central bank repurchases government securities.The central bank makes this transaction with commercial banks to reduce some of the short-term liquidity in the system. The repo rate is dependent on the level of money supply that the bank chooses to fix in the monetary scheme of things. Repo rate is short for repurchase rate. The entity borrowing the security is often referred to as the buyer, while the lender of the securities is referred to as the seller. The central bank has the power to lower the repo rates while expanding the money supply in the country. This enables th e banks to exchange their government security holdings for cash.In contrast, when the central bank decides to reduce the money supply, it implements a rise in the repo rates. At times, the central bank of the nation makes a decision regarding the money supply level and the repo rate is determined by the market. The securities that are being evaluated and sold are transacted at the current market price plus any interest that has accrued. When the sale is concluded, the securities are subsequently resold at a predetermined price. This price is comprised of the original market price and interest, and the pre-agreed interest rate, which is the repo rate. ?BANK RATEBank rate is referred to the rate of interest charged by premier banks on the loans and advances. Bank rate varies based on some defined conditions as laid down the governing authority of the banks. Bank rates are levied to control the money supply to and from the bank. From the consumer's point of view, bank rate ordinarily d enotes to the current rate of interest acquired from savings certificate of Deposit. It is most frequently used by the consumers who are concerned in mortgage Some commonest types of bank interest rates are as follows: oBank rate on CD, i. e. , on certificate of deposit Bank rate on the credit of a credit card or other kind of loan oBank rate on real estate loan ?INTERBANK RATE The rate of interest charged on short-term loans made between banks. Banks borrow and lend money in the interbank market in order to manage liquidity and meet the requirements placed on them. The interest rate charged depends on the availability of money in the market, on prevailing rates and on the specific terms of the contract, such as term length. Banks are required to hold an adequate amount of liquid assets, such as cash, to manage any potential withdrawals from clients.If a bank can't meet these liquidity requirements, it will need to borrow money in the interbank market to cover the shortfall. Some ba nks, on the other hand, have excess liquid assets above and beyond the liquidity requirements. These banks will lend money in the interbank market, receiving interest on the assets. There is a wide range of published interbank rates, including the LIBOR & MIBOR, which is set daily based on the average rates on loans made within the London interbank market & Mumbai Interbank Market. ?GROSS DOMESTIC PRODUCTThe monetary value of all the finished goods and services produced within a country's borders in a specific time period, though GDP is usually calculated on an annual basis. It includes all of private and public consumption, government outlays, investments and exports less imports that occur within a defined territory. GDP = C + G + I + NX Where: ?†C† is equal to all private consumption, or consumer spending, in a nation's economy. ?†G† is the sum of government spending. ?†I† is the sum of all the country's businesses spending on capital. ?† NX† is the nation's total net exports, calculated as total exports minus total imports. NX = Exports – Imports) GDP is commonly used as an indicator of the economic health of a country, as well as to gauge a country's standard of living. ?INFLATION Inflation can be defined as a rise in the general price level and therefore a fall in the value of money. Inflation occurs when the amount of buying power is higher than the output of goods and services. Inflation also occurs when the amount of money exceeds the amount of goods and services available. As to whether the fall in the value of money will affect the functions of money depends on the degree of the fall.Basically, refers to an increase in the supply of currency or credit relative to the availability of goods and services, resulting in higher prices. Therefore, inflation can be measured in terms of percentages. The percentage increase in the price index, as a rate per cent per unit of time, which is usually in years. The two basic price indexes are used when measuring inflation, the producer price index (PPI) and the consumer price index (CPI) which is also known as the cost of living index number. ?DEFLATION It is a condition of falling prices accompanied by a decreasing level of employment, output and income.Deflation is just the opposite of inflation. Deflation occurs when the total expenditure of the community is not equal to the existing prices. Consequently, the supply of money decreases and as a result prices fall. Deflation can also be brought about by direct contractions in spending, either in the form of a reduction in government spending, personal spending or investment spending. Deflation has often had the side effect of increasing unemployment in an economy, since the process often leads to a lower level of demand in the economy. ?DISINFLATIONWhen prices are falling due to anti-inflationary measures adopted by the authorities, with no corresponding decline in the existing level of employment, output and income, the result of this is disinflation. When acute inflation burdens an economy, disinflation is implemented as a cure. Disinflation is said to take place when deliberate attempts are made to curtail expenditure of all sorts to lower prices and money incomes for the benefit of the community. ?REFLATION Reflation is a situation of rising prices, which is deliberately undertaken to relieve a depression.Reflation is a means of motivating the economy to produce. This is achieved by increasing the supply of money or in some instances reducing taxes, which is the opposite of disinflation. Governments can use economic policies such as reducing taxes, changing the supply of money or adjusting the interest rates; which in turn motivates the country to increase their output. The situation is described as semi-inflation or reflation. ?STAGFLATION Stagflation is a stagnant economy that is combined with inflation. Basically, when prices are increasing the economy is de ceasing.Some economists believe that there are two main reasons for stagflation. Firstly, stagflation can occur when an economy is slowed by an unfavourable supply, such as an increase in the price of oil in an oil importing country, which tends to raise prices at the same time that it slows the economy by making production less profitable. In the 1970's inflation and recession occurred in different economies at the same time. Basically, what happened was that there was plenty of liquidity in the system and people were spending money as quickly as they got it because prices were going up quickly.This gave rise to the second reason for stagflation. ?FOREIGN INSTITUTIONAL INVESTMENTS Foreign Institutional Investors (FIIs), Non-Resident Indians (NRIs), and Persons of Indian Origin (PIOs) are allowed to invest in the primary and secondary capital markets in India through the portfolio investment scheme (PIS). Under this scheme, FIIs/NRIs can acquire shares/debentures of Indian companies through the stock exchanges in India. The ceiling for overall investment for FIIs is 24 per cent of the paid up capital of the Indian company and 10 per cent for NRIs/PIOs.The limit is 20 per cent of the paid up capital in the case of public sector banks, including the State Bank of India. ?FOREIGN EXCHANGE RESERVES Foreign exchange reserves (also called Forex reserves) in a strict sense are only the foreign currency deposits held by central banks and monetary authorities. However, the term in popular usage commonly includes foreign exchange and gold, SDRs and IMF reserve positions. This broader figure is more readily available, but it is more accurately termed official reserves or international reserves.These are assets of the central bank held in different reserve currencies, such as the dollar, euro and yen, and used to back its liabilities, e. g. the local currency issued, and the various bank reserves deposited with the central bank, by the government or financial institutions . Large reserves of foreign currency allow a government to manipulate exchange rates – usually to stabilize the foreign exchange rates to provide a more favorable economic environment. ROLE OF BANKS IN DEVELOPING OF ECONOMY A safe and sound financial sector is a prerequisite for sustained growth of any economy.Globalization, deregulation and advances in information technology in recent years have brought about significant changes in the operating environment for banks and other financial institutions. These institutions are faced with increased competitive pressures and changing customer demands. These, in turn, have engendered a rapid increase in product innovations and changes in business strategies. While these developments have enabled improvement in the efficiency of financial institutions, they have also posed some serious risks.Banks play a very useful and dynamic role in the economic life of every modern state. A study of the economic history of western country shows that without the evolution of commercial banks in the 18th and 19th centuries, the industrial revolution would not have taken place in Europe. The economic importance of commercial banks to developing countries may be viewed thus: oPromoting capital formation oEncouraging innovation oMonetsation oInfluence economic activity oFacilitator of monetary policy Above all view we can see in briefly, which are given below:PROMOTING CAPITAL FORMATION A developing economy needs a high rate of capital formation to accelerate the tempo of economic development, but the rate of capital formation depends upon the rate of saving. Unfortunately, in underdeveloped countries, saving is very low. Banks afford facilities for saving and, thus encourage the habits of thrift and industry in the community. They mobilize the ideal and dormant capital of the country and make it available for productive purposes. ENCOURAGING INNOVATION Innovation is another factor responsible for economic development.The entre preneur in innovation is largely dependent on the manner in which bank credit is allocated and utilized in the process of economic growth. Bank credit enables entrepreneurs to innovate and invest, and thus uplift economic activity and progress. MONETSATION Banks are the manufactures of money and they allow many to play its role freely in the economy. Banks monetize debts and also assist the backward subsistence sector of the rural economy by extending their branches in to the rural areas. They must be replaced by the modern commercial bank’s branches. INFLUENCE ECONOMIC ACTIVITYBanks are in a position to influence economic activity in a country by their influence on the rate interest. They can influence the rate of interest in the money market through its supply of funds. Banks may follow a cheap money policy with low interest rates which will tend to stimulate economic activity. FACILITATOR OF MONETARY POLICY Thus monetary policy of a country should be conductive to economic development. But a well-developed banking system is on essential pre-condition to the effective implementation of monetary policy. Under-developed countries cannot afford to ignore this fact.A fine, an efficient and comprehensive banking system is a crucial factor of the developmental process of economy. RESERVE BANK OF INDIA AS A REGULATORY INSTITUTION IN INDIAN ECONOMY The RBI was established under the Reserve Bank of India Act, 1934 on April 1, 1935 as a private shareholders' bank but since its nationalization in 1949, is fully owned by the Government of India. The Preamble of the Reserve Bank describes the basic functions as ‘to regulate the issue of Bank notes and keeping of reserves with a view to securing monetary stability in India and generally, to operate the currency and credit system of the country to its advantage'.The twin objectives of monetary policy in India have evolved over the years as those of maintaining price stability and ensuring adequate flow of cred it to facilitate the growth process. The relative emphasis between the twin objectives is modulated as per the prevailing circumstances and is articulated in the policy statements by the Reserve Bank from time to time. Consideration of macro-economic and financial stability is also subsumed in the mandate. The Reserve Bank is also entrusted with the management of foreign exchange reserves (which include gold holding also), which are reflected in its balance sheet.While the Reserve Bank is essentially a monetary authority, its founding statute mandates it to be the manager of market borrowing of the Government of India and banker to the Government. The Reserve Bank's affairs are governed by a Central Board of Directors, consisting of fourteen non-executive, independent directors nominated by the Government, in addition to the Governor and up to four Deputy Governors. Besides, one Government official is also nominated on the Board who participates in the Board meetings but cannot vote . IMPORTANT FUNCTIONS PLAYED BY RESERVE BANK OF INDIA IN ECONOMY MAIN FUNCTIONS oMONITORY AUTHORITY The Reserve Bank of India formulates implements and monitors the monetary policy. Its main objective is maintaining price stability and ensuring adequate flow of credit to productive sectors. oREGULATOR AND SUPERVISOR OF FINANCIAL SYSTEM Prescribes broad parameters of banking operations within which the country’s banking and financial system functions. Their main objective is to maintain public confidence in the system, protect depositors’ interest and provide cost-effective banking services to the public. MANAGER OF EXCHANGE CONTROL The manager of the exchange control department manages the Foreign Exchange Management Act, 1999. Its main objective is to facilitate external trade and payment and promote orderly development and maintenance of foreign exchange market in India. oISSUER OF THE CURRENCY The person who is issuer issues and exchanges or destroys currency and co ins not fit for circulation. His main objective is to give the public adequate quantity of supplies of currency notes and coins and in good quality. oDEVELOPMENTAL ROLEThe reserve bank of India performs a wide range of promotional functions to support national objectives. The promotional functions are such as contests, coupons, maintaining good public relations, and many more†¦.. oRELATED FUNCTIONS There are also some of the relating functions to the above mentioned main functions. They are such as Banker to the Government, Banker to banks etc†¦. ?BANKER TO THE GOVERNMENT It performs merchant banking function for the central and the state governments; also acts as their banker. ?BANKER TO THE BANKS Maintains banking accounts of all scheduled banks. ?SUPERVISORY FUNCTIONSThe Reserve Bank act, 1934 and the Banking Regulation act, 1949 have given the RBI wide powers of supervision and control over commercial and co-operative banks, relating to licensing and establishments, br anch expansion, liquidity of their asset, management and methods of working, amalgamation, reconstruction, and liquidation. The RBI is authorized to carry out periodical inspections of banks and to call for returns and necessary information from them. The supervisory functions of the RBI have helped a great deal in improving the standard of banking in India to develop on sound lines and to improve the methods of their operation. PROMOTIONAL FUNCTIONS With economic growth assuming a new urgency since Independence, the range of the Reserve Bank’s functions has steadily widened. The bank now performs a variety of developmental and promotional functions, which, at one time were regarded as outside the normal scope of central banking. The RBI was asked to promote banking habit, extend banking facilities to rural and semi-urban areas, and establish and promote new specialized financing agencies. PROBLEMS FACED BY INDIAN ECONOMY Macro-economic environment in India has taken a seriou s turn since the beginning of the year.Unprecedented rise in crude prices, surge in inflation and continued strong growth in money supply (M3) have forced the government and RBI to take strong fiscal and monetary measures leading to liquidity tightening, significant rise in interest rates and slowdown in economic growth. Economic shocks are events which adversely affect the economy and the government’s macroeconomic objectives such as growth, inflation, unemployment and the balance of payments. CERTAIN PROBLEMS FACED BY INDIAN ECONOMY oFALL IN SAVINGS RATIO The savings ratio is the % of income that is saved not spent.A fall in the savings ratio implies that consumer spending is increasing; often this is financed through increased borrowing. EFFECTS OF FALL IN SAVINGS RATIO ?HIGHER LEVEL OF CONSUMPTION This results in increase in Aggregate Demand. The increase in AD will cause an increase in economic growth and lower unemployment. However, rising Aggregate Demand may cause inf lation. Inflation will occur when growth is faster than the long run trend rate. This is now a potential problem in the India. Inflation has recently gone above 12% ?BOOM AND BUST A fall in the savings ratio is usually accompanied by a rise in confidence.It is the rise in confidence which encourages borrowing and consumers to run down savings. Therefore, there is always a danger that a falling savings ratio can be a precursor to a boom and bust situation. ?ECONOMY MORE SENSITIVE TO INTEREST RATES With a fall in the savings ratio interest rate changes will have a bigger effect in reducing spending. This is because levels of borrowing are higher and therefore a rise in interest rates has a significant impact on increasing interest repayments. Also, higher rates will not be increasing incomes from savings as much. ?BALANCE OF PAYMENTWith higher levels of consumer spending, there will be an increase in imports. Therefore this will lead to deterioration in the current account. The curren t account deficit could put downward pressure on the exchange rate in the long term. However, some people argue a fall in the savings ratio is not a problem, but, it is just a reflection of strong economy and booming housing market, which increases scope for equity withdrawal. oINFLATION Inflation is posing a serious challenge to the economic growth of India. Since Jan’08 onwards, inflation in the country has surged by 8. 2% to hit a 13-year high of ~12%.M3 growth in the economy too continued to remain strong at 20% (in July’08), well above the RBI’s comfort level of 17%. The WPI inflation rate flared up during the period driven by significant increase in the prices of commodities, primary articles and manufactured products, even though very small part of global crude price increase has been passed on to the Indian consumers. oGLOBAL RECESSION It appears that Europe, Japan and the US are entering into recession. Falling house prices, crisis in the financial syst em, and lower confidence could lead to a sharp downturn, with the worst still to come.Many argue that India’s growth is not so dependent on growth in the West. However, the Indian stock markets have been hit by the global crisis. India’s growing service sector and manufacturing sector would be adversely impacted by a global downturn. oRISE IN CRUDE PRICES How global crude prices would behave probably has no easy answers; however we believe that the current challenging and uncertain macro-economic conditions does not lead Indian financials into a state of crisis. But continued rise in crude prices and its resultant impact on inflation, interest rates and government finances has the potential to do so.Hence, crude price remains the key risk to our positive stance on the Indian financials. In the last couple of months oil prices have surged by 45% from US$ 100 to US$ 145 (and now back to US$ 115). India currently imports 70% of its crude requirement, resulting in pressure on government coffers on back of rising crude prices. oDEPRICIATING INR Surge in crude prices has severely impacted current account deficit of the country. This coupled with the outflow of FII investments has resulted in INR to depreciate sharply against dollar further fueling inflation. IMPACT OF ECONOMIC PROBLEMS ON INDIAN FINANCIALSThe current macro-economic conditions are expected to result in oSLOWDOWN IN CREDIT GROWTH oIMPACT ON MARGINS OF BANKS oPREASURE ON CREDIT QUALITY †¢SLOWDOWN IN CREDIT GROWTH While the rise in interest rates should lead to a moderation in demand for credit, Indian banks too are exercising caution while lending. Credit growth of 18% in FY09E and 17% in FY10E vs. 22% in FY08. Risks and uncertainties in the system have increased given the higher crude and commodity prices and its inflationary impact. This would curtail consumption, which would impact economic growth adversely.Further higher rates will not only impact the profitability of Indian corp orate but also impact IRRs of various proposed capex projects. This coupled with elections next year could lead to some postponement of capex plans of corporate, leading to negative impact on demand for credit. Higher rates have particularly impacted retail loan growth. As can be seen in the exhibit below, retail loan growth has slowed down significantly from 26. 5% in FY07 to ~13% in FY08. SLR Ratio of the system has started rising since mid FY08 and currently stands at 28. %. Given the expected negative impact on credit growth. †¢IMPACT ON MARGINS OF BANKS During the past 18 months, CRR has increased by 400 bps to 9. 0% currently and RBI has also discontinued with interest payment on CRR balances. Every 50 bps hike in CRR generally negatively impacts margins by ~5 bps. Till June’08, most of the banks had restrained from hiking lending rates despite significant monetary tightening. However on account of recent measures by RBI, banks have resorted to hiking PLRs in July/ August by 50-150 bps to preserve their margins.In fact in an environment, where liquidity is tight, interest rates are at elevated levels and risk premiums have increased, the banks tend to regain the pricing power. This would not only help the banks to adequately price in risks but also help protect their margins. Apart from hiking PLRs, banks are also resorting to reprising (in fact right-pricing) the loans that were sanctioned well below PLRs. Significant portion of fixed rate loans would also get re-priced over the period of 12-18 months. †¢PRESSURE ON CREDIT QUALITY Higher lending rates are expected to impact credit quality for the banking system.The extent of the impact on credit quality would also be bank specific given the loan mix (retail vs. corporate), proportion of unsecured lending, credit profile of corporate loan book and industry wise exposure. Indian banks’ fundamentals are relatively resilient with better risk management systems, dramatically improved a sset quality, stronger recovery mechanisms (legal provisions) and with adequate capitalization and provisioning. Even Certain sectors (like real estate, airlines industry) might feel the stress due to the changing macro environment and rise in interest rates.Many companies where crude forms a key raw material component are expected to get hit more severely. Similarly, sectors like real estate and SMEs, which are interest rate sensitive, would face higher delinquencies if interest rates strengthen further by 100-200 bps. NECESSARY INITIATIVES TAKEN BY RBI & MINISTRY OF FINANCE TO TACKLE ECONOMIC PROBLEMS As most of economists feel that the most horrible problem which India is facing currently is inflation which has crossed 12%. To come out of these problems RBI and ministry of finance and other relevant government and regulatory entities are taking various initiatives which are as follows†¦ RBI MONITORY POLICY With the introduction of the Five year plans, the need for appropriat e adjustment in monetary and fiscal policies to suit the pace and pattern of planned development became imperative. The monitory policy since 1952 emphasized the twin aims of the economic policy of the government: oSpread up economic development in the country to raise national income and standard of living, and oTo control and reduce inflationary pressure in the economy. This policy of RBI since the First plan period was termed broadly as one of controlled expansion, i. e. a policy of â€Å"adequate financing of economic growth and at the same time the time ensuring reasonable price stability†. Expansion of currency and credit was essential to meet the increased demand for investment funds in an economy like India which had embarked on rapid economic development. Accordingly, RBI helped the economy to expand via expansion of money and credit and attempted to check in rise in prices by the use of selective controls. OBJECTIVES OF MONITORY POLICY ?PRICE STABILITY ?MONITORY TAR GETTING ?INTEREST RATE POLICY ?RESTRUCTURING OF MONEY MARKET ?REGULATION OF FOREIGN EXCHANGE MARKET WEAPONS OF MONITORY POLICYCentral banks generally use the three quantitative measures to control the volume of credit in an economy, namely: oRaising bank rates oOpen market operations and oVariable reserve ratio However, there are various limitations on the effective working of the quantitative measures of credit control adapted by the central banks and, to that extent, monetary measures to control inflation are weakened. In fact, in controlling inflation moderate monetary measures, by themselves, are relatively ineffective. On the other hand, drastic monetary measures are not good for the economic system because they may easily send the economy into a decline.In a developing economy there is always an increasing need for credit. Growth requires credit expansion but to check inflation, there is need to contract credit. In such a encounter, the best course is to resort to credit contr ol, restricting the flow of credit into the unproductive, inflation-infected sectors and speculative activities, and diversifying the flow of credit towards the most desirable needs of productive and growth-inducing sector. It should be noted that the impression that the rate of spending can be controlled rigorously by the contraction of credit or money supply is wrong in the context of modern economic societies.In modern community, tangible, wealth is typically represented by claims in the form of securities, bonds, etc. , or near moneys, as they are called. Such near moneys are highly liquid assets, and they are very close to being money. They increase the general liquidity of the economy. In these circumstances, it is not so simple to control the rate of spending or total outlays merely by controlling the quantity of money. Thus, there is no immediate and direct relationship between money supply and the price level, as is normally conceived by the traditional quantity theories.Wh en there is inflation in an economy, monetary restraints can, in conjunction with other measures, play a useful role in controlling inflation. †¢FISCAL POLICY Fiscal policy is another type of budgetary policy in relation to taxation, public borrowing, and public expenditure. To curve the effects of inflation and changes in the total expenditure, fiscal measures would have to be implemented which involves an increase in taxation and decrease in government spending. During inflationary periods the government is supposed to counteract an increase in private spending.It can be cleared noted that during a period of full employment inflation, the aggregate demand in relation to the limited supply of goods and services is reduced to the extent that government expenditures are shortened. Along with public expenditure, governments must simultaneously increase taxes that would effectively reduce private expenditure, in an effect to minimise inflationary pressures. It is known that when m ore taxes are imposed, the size of the disposable income diminishes, also the magnitude of the inflationary gap in regards to the availability of the supply of goods and services.In some instances, tax policy has been directed towards restricting demand without restricting level of production. For example, excise duties or sales tax on various commodities may take away the buying power from the consumer goods market without discouraging the level of production. However, some economists point out that this is not a correct way of combating inflation because it may lead to a regressive status within the economy. As a result, this may lead to a further rise in prices of goods and services, and inflation can spread from one sector of the economy to another and from one type of goods and services to another.Therefore, a reduction in public expenditure, and an increase in taxes produces a cash surplus in the budget. Keynes, however, suggested a programme of compulsory savings, such as def erred pay as an anti-inflationary measure. Deferred pay indicates that the consumer defers a part of his or her wages by buying savings bonds (which, of course, is a sort of public borrowing), which are redeemable after a particular period of time, this is sometimes called forced savings. Additionally, private savings have a strong disinflationary effect on the economy and an increase in these is an important measure for controlling inflation.Government policy should therefore, include devices for increasing savings. A strong savings drive reduces the spendable income of the consumers, without any harmful effects of any kind that are associated with higher taxation. Furthermore, the effects of a large deficit budget, which is mainly responsible for inflation, can be partially offset by covering the deficit through public borrowings. It should be noted that it is only government borrowing from non-bank lenders that has a disinflationary effect.In addition, public debt may be managed in such a way that the supply of money in the country may be controlled. The government should avoid paying back any of its past loans during inflationary periods, in order to prevent an increase in the circulation of money. Anti-inflationary debt management also includes cancellation of public debt held by the central bank out of a budgetary surplus. Fiscal policy by itself may not be very effective in combating inflation; therefore a combination of fiscal and monetary tools can work together in achieving the desired outcome. †¢DIRECT MEASURESDirect controls refer to the regulatory measures undertaken to convert an open inflation into a repressed one. Such regulatory measures involve the use of direct control on prices and rationing of scarce goods. The function of price control is a fix a legal ceiling, beyond which prices of particular goods may not increase. When ceiling prices are fixed and enforced, it means prices are not allowed to rise further and so, inflation is supp ressed. Under price control, producers cannot raise the price beyond a specified level, even though there may be a pressure of excessive demand forcing it up.In times of the severe scarcity of certain goods, particularly, food grains, government may have to enforce rationing, along with price control. The main function of rationing is to divert consumption from those commodities whose supply needs to be restricted for some special reasons; such as, to make the commodity more available to a larger number of households. Therefore, rationing becomes essential when necessities, such as food grains, are relatively scarce. Rationing has the effect of limiting the variety of quantity of goods available for the good cause of price stability and distributive impartiality.Another control measure that was suggested is the control of wages as it often becomes necessary in order to stop a wage-price spiral. During galloping inflation, it may be necessary to apply a wage-profit freeze. Ceilings o n wages and profits keep down disposable income and, therefore the total effective demand for goods and services. On the other hand, restrictions on imports may also help to increase supplies of essential commodities and ease the inflationary pressure. However, this is possible only to a limited extent, depending upon the balance of payments situation.Similarly, exports may also be reduced in an effort to increase the availability of the domestic supply of essential commodities so that inflation is eased. In general, monetary and fiscal controls may be used to repress excess demand but direct controls can be more useful when they are applied to specific scarcity areas. As a result, anti-inflationary policies should involve varied programmes and cannot exclusively depend on a particular type of measure only. RECENT INNOVATIONS IN INDIAN BANKING HDFC Bank’s ‘Net Safe’ card is a one-time use card with a limit that’s specified, taken from Tendon’s credi t or debit card.Even if Tandon fails to utilize the full amount within 24 hours of creating the card, the card simply dies and the unspent amount in the temporary card reverts to his original credit or debit card. Welcome to one of the myriad ways in which bankers have been trying to innovate. They’re bringing ATMs, cash and even foreign exchange to their customers’ doorsteps. Indeed, innovation has become the hottest banking game in town. Want to buy a house but don’t want to go through the hassles of haggling with brokers and the mounds of paperwork? Not to worry.Your bank will tackle all this. It’s ready to come every step of the way for you to buy a house. Standard Chartered, for instance, has property advisors to guide a customer through the entire process of selecting and buying a house. They also lend a hand with the cumbersome documentation formalities and the registration. Don’t fret if you’ve already bought your house or car â€⠀œ you can do other things with both. You can leverage your new house or car these days with banks like ICICI Bank and Stanchart ready to extend loans against either, till it’s about five years old.Loans are available to all car owners for almost all brands of cars manufactured in India that are up to five years old. Last month, Kotak Mahindra Bank introduced a variant of the sweep-in account. If the balance tops Rs 1. 5 lakh, the excess runs into Kotak’s liquid mutual fund. â€Å"Even if the money is there only for the weekend, a liquid fund can earn you a clean 4. 5 per cent per annum,† points out Shashi Arora, vice president, marketing, Kotak Mahindra Bank. That’s not a small gain considering that your current account does not pay you any interest.And if, meanwhile, you want to buy a big-ticket home theatre system, the minute you swipe your card the invested sum will return to your account. Banks are also attempting to reach out to residents of metropo litan cities where people are pressed for time (what with long commuting hours, traffic jams and both spouses working), beyond conventional banking hours. ICICI Bank, for example, introduced eight to eight banking hours, seven days of the week, in major cities. Not to be outdone, some of the other private banks have also done this too.HDFC Bank even has a 24-hour branch at Mumbai’s international airport. INDIAN BANKING IN 2010 The interplay between policy and regulatory interventions and management strategies will determine the performance of Indian banking over the next few years. Legislative actions will shape the regulatory stance through six key elements: industry structure and sector consolidation; freedom to deploy capital; regulatory coverage; corporate governance; labor reforms and human capital development; and support for creating industry utilities and service bureaus.Management success will be determined on three fronts: fundamentally upgrading organizational capa bility to stay in tune with the changing market; adopting value-creating M&A as an avenue for growth; and continually innovating to develop new business models to access untapped opportunities. Through these scenarios, we can paint a picture of the events and outcomes that will be the consequence of the actions of policy makers and bank managements. These actions will have dramatically different outcomes; the costs of inaction or insufficient action will be high. Specifically, at one extreme, the sector could account for over 7. per cent of GDP with over Rs.. 7,500 billion in market cap, while at the other it could account for just 3. 3 per cent of GDP with a market cap of Rs. 2,400 billion. Banking sector intermediation, as measured by total loans as a percentage of GDP, could grow marginally from its current levels of ~30 per cent to ~45 per cent or grow significantly to over 100 per cent of GDP. In all of this, the sector could generate employment to the tune of 1. 5 million comp ared to 0. 9 million. Today availability of capital would be a key factor — the banking sector will require as much as Rs. 00 billion (US$ 14 billion) in capital to fund growth in advances, non-performing loan (NPL) write offs and investments in IT and human capital up gradation to reach the high-performing scenario. Three scenarios can be defined to characterize these outcomes: oHIGH PERFORMANCE In this scenario, policy makers intervene only to the extent required to ensure system stability and protection of consumer interests, leaving managements free to drive far reaching changes. Changes in regulations and bank capabilities reduce intermediation costs leading to increased growth, innovation and productivity.Banking becomes an even greater driver of GDP growth and employment and large sections of the population gain access to quality banking products. Management is able to overhaul bank organizational structures, focus on industry consolidation and transform the banks into industry shapers. In this scenario we witness consolidation within public sector banks (PSBs) and within private sector banks. Foreign banks begin to be active in M&A, buying out some old private and newer private banks. Some M&A activity also begins to take place between private and public sector banks.As a result, foreign and new private banks grow at rates of 50 per cent, while PSBs improve their growth rate to 15 per cent. The share of the private sector banks (including through mergers with PSBs) increases to 35 per cent and that of foreign banks increases to 20 per cent of total sector assets. The share of banking sector value adds in GDP increases to over 7. 7 per cent, from current levels of 2. 5 per cent. Funding this dramatic growth will require as much as Rs. 600 billion in capital over the next few years. oEVOLUTION Policy makers adopt a pro-market stance but are cautious in liberalizing the industry.As a result of this, some constraints still exist. Processes to create highly efficient organizations have been initiated but most banks are still not best-in-class operators. Thus, while the sector emerges as an important driver of the economy and wealth in 2010, it has still not come of age in comparison to developed markets. Significant changes are still required in policy and regulation and in capability-building measures, especially by public sector and old private sector banks. In this scenario, M&A activity is driven primarily by new private banks, which take over some old private banks and also merge among themselves.As a result, growth of these banks increases to 35 per cent. Foreign banks also grow faster at 30 per cent due to a relaxation of some regulations. The share of private sector banks increases to 30 per cent of total sector assets, from current levels of 18 per cent, while that of foreign banks increases to over 12 per cent of total assets. The share of banking sector value adds to GDP increases to over 4. 7 per cent. oSTAGNATION I n this scenario, policy makers intervene to set restrictive conditions and management is unable to execute the changes needed to enhance returns to shareholders and provide quality products and services to customers.As a result, growth and productivity levels are low and the banking sector is unable to support a fast-growing economy. This scenario sees limited consolidation in the sector and most banks remain sub-scale. New private sector banks continue on their growth trajectory of 25 per cent. There is a slowdown in PSB and old private sector bank growth. The share of foreign banks remains at 7 per cent of total assets. Banking sector value adds meanwhile, is only 3. 3 per cent of GDP. oNEED TO CREATE A MARKET DRIVEN BANKING SECTOR WITH ADEQUATE FOCUS ON SOCIAL DEVELOPMENTThe term â€Å"policy makers†, refers to the Ministry of Finance and the RBI and includes the other relevant government and regulatory entities for the banking sector. The coordinated efforts between the v arious entities are required to enable positive action. This will spur on the performance of the sector. The policy makers need to make coordinated efforts on six fronts: †¢Help shape a superior industry structure in a phased manner through â€Å"managed consolidation† and by enabling capital availability.This would create 3-4 global sized banks controlling 35-45 per cent of the market in India; 6-8 national banks controlling 20-25 per cent of the market; 4-6 foreign banks with 15-20 per cent share in the market, and the rest being specialist players (geographical or product/ segment focused). †¢Focus strongly on â€Å"social development† by moving away from universal directed norms to an explicit incentive-driven framework by introducing credit guarantees and market subsidies to encourage leading public sector, private and foreign players to leverage technology to innovate and profitably provide banking services to lower income and rural markets. Create a un ified regulator, distinct from the central bank of the country, in a phased manner to overcome supervisory difficulties and reduce compliance costs. †¢Improve corporate governance primarily by increasing board independence and accountability. †¢Accelerate the creation of world class supporting infrastructure (e. g. , payments, asset reconstruction companies (ARCs), credit bureaus, back-office utilities) to help the banking sector focus on core activities. †¢Enable labor reforms, focusing on enriching human capital, to help public sector and old private banks become competitive. NEED FOR DECISIVE ACTION BY BANK MANAGEMENT Management imperatives will differ by bank. However, there will be common themes across classes of banks: †¢PSBs need to fundamentally strengthen institutional skill levels especially in sales and mar marketing, service operations, risk management and the overall organizational performance ethic. The last, i. e. , strengthening human capital will be the single biggest challenge. †¢Old private sector banks also have the need to fundamentally strengthen skill levels.However, even more imperative is their need to examine their participation in the Indian banking sector and their ability to remain independent in the light of the discontinuities in the sector. †¢New private banks could reach the next level of their growth in the Indian banking sector by continuing to innovate and develop differentiated business models to profitably serve segments like the rural/low income and affluent/ HNI segments; actively adopting acquisitions as a means to grow and reaching the next level of performance in their service platforms.Attracting, developing and retaining more leadership capacity would be key to achieving this and would pose the biggest challenge. †¢Foreign banks committed to making a play in India will need to adopt alternative approaches to win the â€Å"race for the customer† and build a value-creating cus tomer franchise in advance of regulations potentially opening up post 2009. At the same time, they should stay in the game for potential acquisition opportunities as and when they appear in the near term. Maintaining a fundamentally long-term value-creation mindset will be their greatest challenge.The extent to which Indian policy makers and bank managements develop and execute such a clear and complementary agenda to tackle emerging discontinuities will lay the foundations for a high-performing sector in 2010. CONCLUSION We can conclude that the financial sector is a nerve system of Indian economy. Banking plays an important role in development of economy. For steady growth in economy innovations and development in financial sector is very important. Economy of any country faces lots of challenges and problems. To tackle those problems financial sector plays a vital role.The financial sector makes the economy efficient to the extent where it can rival other developed economies in t he world. Financial sector also faces lots of problems but it should develop certain strategies to come out of these problems which is very important for healthy growth of economy. BIBLIOGRAPHY ?FINANCIAL SRVICES AND MARKET GORDAN AND NATRAJAN ?INDIAN BANKING SYSTEM V. K. BHALLA ?INTRODUC TION TO ECONOMIC ANALYSIS R. PRESTON MCAFEE ?MONEY, BANKING, INTERNATIONAL TRADE AND PUBLIC FINANCE D. M. MITHANI ?BANKING AND PRACTICE P. N. VARSHNEW ?MONEYCONTROL. COM ?MONEYPORE. COM ?RBI. ORG. IN