The No Child Left Behind Act and Educational Technology...

The No Child Left Behind Act and Educational Technology Overview of Act: What it entails The No Child Left Behind (NCLB) Act has become a large, nationwide issue, since President George Bush signed it into law on January 8, 2002, giving the schools the responsibility to keep every student’s academic achievement at a passing level. (Florida Department of Education; 2003; pg. 1) Each state had twelve years to have all students proficient in reading and math, which gave each state less than a year to create a plan. (Kim Sunderman; 2004; pg. 19) Title I, which is included in this act, began in 1965 when the Elementary and Secondary Education Act was passed, which gave federal funds to help academically struggling students. (North†¦show more content†¦Proficient means scoring a three or above on a one to five scale on the Florida Comprehensive Assessment Test (FCAT). Under the A+ School Grading System, any school rated â€Å"D† or â€Å"F† will not make AYP. (Florida Department of Education; 2003; pgs. 2-3) Beginning in the 2005-2006 school year, schools must test reading and mathematics every year from grades three through eight and once at the high school level. By 2007, science must be tested once from grades three through five, once between grades six through nine and once between grades ten through twelve. The assessments must contain multiple choice questions and well as open-ended questions. Each school must also be considered a safe school or students will be allowed to transfer. A school becomes unsafe if any student or teacher is a victim of a violent criminal offense. (Office of Educational Accountability; University of Minnesota; 2002; pg. 8) The No Child Left Behind Act has created rules and laws to be sure that each of these requirements is enforced. Overview of Act: How it is enforced If a school is a Title I district, a school which received the largest amount of funding possible (North Carolina Department of Education; 2004; pg. 1), that has not made AYP for two years in a row, they are then identified as needing improvement and must make changes before the next year begins. They receive help and technical assistance to create a two-year plan to help make AYP. If theShow MoreRelatedStudent Demographics Of Richmond County Schools1273 Words   |  6 Pagesschools in the rural areas. Explanation of choosing the â€Å"No Child Left Behind† Act The â€Å"No Child Left Behind† (NCLB) Act is an important topic in education to me, because I was a student when the act went into effect and I’m currently an Educator as the act comes to an end. I am able to look at the effectiveness of the act as a student and as the Educator. The NCLB act went into effect during my generation and now I teach under the act to the current generation of students; therefore, it has a personalRead MoreThe Importance of Improving Public Education Essay examples1453 Words   |  6 Pagesspecifically the â€Å"No Child Left Behind Act.† The No Child Left Behind Act was not the first law passed to affect the nation’s educational systems, nor will it be the last. There have been several problems laid out with the various educational systems put into place, and there are many things we could do today to better our educational systems in the future. Before President Bush’s No Child Left Behind Act went into place there was the â€Å"Elementary and Secondary Education Act of 1965.† However,Read MoreHow Education Is The Key Focus On Improving Test Scores1635 Words   |  7 Pagesteaching levels, what should be taught and standardized test to check for improvement, and are working on implementing another one called the Common Core State Standards (CCSS). George Bush introduced the ‘No Child Left behind Act’ (NCLB) in 2002. Since 1969 the ‘National Assessment of Educational Progress’ (NAEP) has provided data on students’ test scores and performances. The ‘Mississippi Curriculum Test, Second Edition’ (MCT2) was founded on the MS frameworks of the 2006 Language Arts and the 2007Read MoreEssay about Teacher quality is Determined by Many Factors1668 Words   |  7 PagesStates government has recently given its input on this significant issue of teacher quality through th e passing of the No Child Left Behind Act of 2001. The purpose of this law, a revision of the 1965 Elementary and Secondary Education Act, is to ensure that each American child is able to fulfill the high learning standards of his or her state (â€Å"United States,† 2004). The act proposes goals that improve upon four wide aspects of education. These include accountability for results, emphasis on provenRead MoreEssay on austin educationalissues1652 Words   |  7 Pagesto make necessary changes. In America, education is available to all, no matter ability or disability or socioeconomic status. The public education system in the United States allows people of diverse backgrounds to come together. However, the educational system in America also suffers many problems, and some believe the quality of education is declining. It is difficult to maintain classrooms conducive to learning. The federal government and state governments both attempt to alleviate some of theRead MoreNo Child Left Behind ( Nclb )761 Words   |  4 Pages The standards are overseen at a national level by the U.S. educational policy No Child Left Behind (NCLB); at the state level for example in Texas it is the Texas Essential Knowledge and Skills (TEKS). Due to poor school performance once again, the United States Educational Policy is in the midst of an education reform. No Child Left Behind (NCLB) is currently the educational policy in the United States. Prior to NCLB, the educational policies in effect were â€Å"A Nation at Risk, in 1987 America 2000Read MoreEducation Industry Laws and Regulations941 Words   |  4 Pagesregulations that protects the teachers and students. The Individuals with Disabilities Education Act (IDEA) was established in 2004. This is a federal law that governs how public agencies and states serve children with disabilities from birth to age 21. This act consists of different parts and the second part addresses the education of school age children with disabilities. This is to ensure that every child with a disability has a free public education available to them. They also have related servicesRead MoreEssay On No Child Left Behind928 Words   |  4 PagesNo Child Left Behind The No Child Left Behind Act of 2001 was a US Act of Congress. This law took effect in 2002. This had an impact on US public school classrooms. Through this law there were several effects in the way schools teaching their students. this also affected what tests the students had to take and the teachers training. This also addressed the way schools and their districts were going to spend their monetary funds. The goal of this act was to provide educators assistance in planningRead MoreNo Child Left Alive: A Critique of No Child Left Behind Essay example1573 Words   |  7 PagesNo Child Left Alive No child left behind does nothing but dishearten the students who are proving to be ahead of the average student from wanting to improve. While the struggling students are simply carried from one grade to the next. The No Child Left Behind Act is great in theory but is too heavily reliant on standardized tests and percentages and not enough about what the students actually learn. Being a survivor of NCLB I have had firsthand experience with this topic and from an above averageRead More Integrating Technology in the Language Arts Classroom Essay719 Words   |  3 PagesIntegrating Technology in the Language Arts Classroom School leaders today are under extreme pressure to improve student achievement levels. Yet, in the face of tight budgets, threats to cut extra-curricular activities, and an extensive shortage of textbooks in the schools, exactly what are teachers supposed to do to ensure that â€Å"no child is really left behind.† Despite what looks like a dead end, there is hope. By integrating the usage of technology in the Language Arts classroom, students

Holocaust Ghettos - 1611 Words

Life in the Ghetto In 1939, Hitler was unsure of what he was going to do with the Jews; the Nazis were tossing around options and ideas with the goal of removing Jews from the population. The German invasion into Poland, allowed for the first ghetto, regarded as a provisional measure to control and segregate Jews. Ghettos were enclosed, isolated urban areas designated for Jews. Living under strict regulations, with unthinkable living conditions, and crammed into small areas, the ghettos destroyed all hope of retaliating. In this paper, I will discuss what life would be like to be a Jew inside one of the 1,000 of ghettos within Poland and the Soviet Union. I will imagine myself a member of the Jewish council, describing the†¦show more content†¦There was a love hate relationship with their fellow Jews. â€Å"Above them loomed German orders; below them spread the ever more desperate needs of the Jewish communities† (Genocide 116). Some of the Jews resented the Jewish Council, saying they should have warned them or done more. They didn’t like the Council collaborating with the Germans. â€Å"†¦the Jewish Councils tried to help their people, to maintain order, save lives, and to feed, clothe, and doctor the Jews in the ghettos† (Genocide 116). There was hostility from their own people and in some ways it pushed them to behave the opposite of their goal. They tried to mediate and plead on the Jews behalf. Some Council members helped with the resistance and some believed it would doom the entire ghetto. An example of the Jewish Council in the ghetto is, â€Å"New proclamations from the Judenrat have been hung up which have caused panic among the Jews. The families of those working are no longer protected† (Images 161). The Jewish Council formed its own Jewish Order Police. The Jewish police were also made to enforce order and deport Jews following the commands of the Germans. Like the Council, the Order Police were also disliked among the ghetto tenants. The purpose of the police was to prevent crime, supervise sanitation, and direct traffic. â€Å"The Jewish police delivered to the Germans exactly the number of people needed, rounding them upShow MoreRelatedThe Jewish Ghettos Of The Holocaust1715 Words   |  7 Pageswas like in the Jewish ghettos. There were ghettos before the Holocaust, the first being in Venice in the 16th century, there are ghettos today, and there will be ghettos in the future, but the Jewish ghettos of the Holocaust are by far the most prominent. According to Merriam-Webster a ghetto is, â€Å" a part of a city in which members of a particular group or race live usually in poor conditions (ghetto).† This paper will focus, however, on what daily life was like in the ghettos, what Jews did or didn’tRead MoreEssay Holocaust Ghettos918 Words   |  4 PagesHolocaust Ghettos Holocaust ghettos; these are the over looked places where the Jews, in Nazi controlled lands, awaited their future. The Nazis revived the medieval ghetto in creating their compulsory Jewish Quarter (Wohnbezirk). The ghetto was a section of a city where all Jews from the surrounding areas were forced to reside. Surrounded by barbed wire or walls, the ghettos were often sealed so that people were preventedRead MoreGhettos in the Holocaust: The Badge of Shame1243 Words   |  5 Pageswas like watching people in a storybook-we had no food, no milk... These words of Nelly Cesana, a survivor of the Warsaw ghetto, are just a slight insight to the torture and neglect that Jews endured while living at the ghettos of the Holocaust. The concept of separation of people by religion actually began in the Middle Ages. By the time the Nazis came to power, the ghettos were no longer in use, but the Nazis revived the idea of separation by religion. The Nazis wanted the Jews separated fromRead MoreThe Holocaust Of The Ghetto1185 Words   |  5 Pagestrying to escape. After all the Jews got on the train my family and I prayed that we would all stay together. After what it seemed like forever we arrived in a town called Rzeszow. There My family and the rest of the Jews were forced to live in a ghetto. The ghetto was small but at least I was able to stay with my family. We had to share a house with four other Jewish families. It was usually really crowded inside so I spent most of the day outside. There were a lot of kids there but none that I wouldRead MoreThe Holocaust Of The Nazi Party791 Words   |  4 Pageshomosexuals and yes the Jewish. The Holocaust is a prime example of genocide. The Nazis sent their prisoners to concentration camps where they were denied food, forced to work ungodly hours and made to sleep in cramp insect-infested barracks. But before that the German people were forced to undergo test to make sure they were â€Å"German†. Then they ones who were different were separated and branded-like the Jewish Star of David. Later they were sent to ghettos. Eventually the prisoners were taken toRead MoreThe Holocaust During World War II1651 Words   |  7 PagesThe holocaust was the genocide of European Jews and other groups by the Nazis during World War II. It lasted from 1933 to 1945, as a horrible time in history. Approximately 11 million people were killed, and almost 1 million of those killed were innocent children. It is well-known that there were a number of survivors, yet not many people know exactly how these people survived. The most known thing about the holocaust are the concentration camps. A concentration camp is defined by, â€Å"a place whereRead MoreReflection About Holocaust787 Words   |  4 Pagesas I. Around 11,000,000 people were killed in one of the most hateful crimes in all of history: the Holocaust. Although we could not have prevented this tragedy, I believe that we should all work to stop something like this from ever happening again. In order to prevent, however, we must first educate ourselves. And I think a great way to educate ourselves on the Holocaust is to visit the Holocaust Museum in Washington D.C., just as I did last summer. When my family and I arrived at the museumRead More Jewish Ghettos Essay1820 Words   |  8 Pages Jewish ghettos: The basic history of the formation of the Jewish ghettos, including the everyday life and economic hardships faced by the communities. nbsp;nbsp;nbsp;nbsp;nbsp;By definition, a ghetto is an area, usually characterized by poverty and poor living conditions, which houses many people of a similar religion, race or nationality. They served to confine these groups of people and isolate them from the rest of the community because of political or social differences. However, theRead MoreSummary Of Maus By Art Spiegelman Essay1593 Words   |  7 PagesMaus by Art Spiegelman is a graphic novel about a man s story of surviving the holocaust and the son was asking his father to tell this story. By itself this is a great story a man trying to survive the Holocaust against the odds and reunite with his lost love. Outside the simple exterior there is a dark theme of guilt that enhances the text from cover to cover. This theme of guilt is something that can be seen throughout the story, in a surprising number of times and an even more surprising numberRead MoreCompare and Contrast Essay1003 Words   |  5 Pagesto survive.  T he Pianist† is a little different. In it the main character has to endure harsh treatment at the Warsaw Ghetto and after he is released, he goes into hiding in hope that he will survive the Holocaust and the war. One of the main thematic similarities between  Maus  and â€Å"The Pianist† is that man can be so evil to other people. Both pieces take place during the Holocaust, where Nazis set out to kill all Jews in Europe, which was known as the Final Solution. Most people found it unbelievable

Fun Time Free Essays

http://www. ehow. com/facts_5788552_benefits-open-campus-lunch_. We will write a custom essay sample on Fun Time or any similar topic only for you Order Now html Budget * If students are allowed to leave campus and their parents’ homes are nearby, students can save money on lunch and eat from home. Social Contact * Students may spend time with others who they may not see if the lunch was confined to on campus. Students can go out and eat with friends. Outside * If it’s a great day outside, students can eat outdoors and enjoy the sun for a half-hour or so. This could lead to a fresh burst of energy and creativity. Independence * Open campus lunch allows the students to leave the premise of the school. This grants the student freedom to eat where he wants. Physical Activity * When students are allowed to leave campus, they can get out and stretch their legs a little more than if they were confined to a lunch room. http://www. masters. edu/undergrad/student-perspective/offcampuseats. aspx Line too long in the cafeteria and not a lot of change in your wallet? In need of a good quick fix? There are several places in Santa Clarita that can satisfy your food cravings at an affordable price of $10 and under. Egg Plantation, Urbane Cafe, Chronic Tacos, La Cocina, Qdoba Mexican Grill, Corner Bakery, El Taco Llama, Saugus Cafe and Panera Bread are just a few of the delicious options to choose from. It all just depends on what type of food you are in the mood for. Don‘t know where they are located? Simply go to Yelp, Map Quest, or Google Maps and enter the destination. Here are a few off-campus favorites to whet your appetite: Breakfast ? Breakfast is offered at Egg Plantation, Corner Bakery, and Panera Bread. All have price ranges between $6-$10. These bakery cafes also offer a comfortable, friendly, fashionable place to study or hang out with friends. Egg Plantation in Newhall is home of 101 delicious omelets. Panera Bread and Corner Bakery not only offer breakfast, lunch, and dinner but free wire-less Internet as well. Way Station Coffee Shop and Eggs N Things are some mom and pop cafes that offer a wide variety of delectable breakfasts. Lunch/Dinner ? In the mood for Mexican food? Chronic Tacos (breakfast available), El Taco Llama, Qdoba Mexican Grill, and La Cocina Restaurant have good tasting lunch and dinner dishes that range anywhere from $5-10. The great thing about Qdoba is if you bring in a student ID then you are qualified for a free drink with your meal. Talk about a deal. Urbane Cafe is an excellent lunch or dinner stop that offer‘s some of the best sandwiches in Santa Clarita. Not only do you get a sandwich but a salad as well, both for $7. Just take a pick from their wide selection of sandwiches, soups, and salads. 4-Hour-Breakfast/Lunch/Dinner? If it is late and you are getting the munchies The Saugus Cafe is open 24 hours (Wednesday to Friday) with breakfast, lunch, and dinner all located within minutes from campus. Good service, friendly staff, a nice atmosphere, and affordable prices. That‘s what they all have in common. Just grab a friend and enjoy your meal. http://www. thetitanchronicle. com/editorials/2011/03/31/off-campus-lunch es/ What if upperclassmen could have lunch off campus? That would be great news to 11th and 12th graders. It would mean upper-classmen would no longer be cooped up in school all-day; after all, this isn’t elementary school. We are young adults capable of handling the responsibility of leaving school. Set the bar high administrators, and if students decide not to come back, then consequences should be handed out. For example, if a student doesn’t come back to school, they would face suspension. Consider the age difference between the lower-class and the upper-class. Since the 11th graders and 12th graders have reached a certain level of maturity, they can handle eating lunch off campus. Upperclassmen are basically young adults and should continue to experience increased responsibilities so that they can become more productive members of our community. Not everyone should enjoy off campus lunch; only students with good grades. Not only should upper-classmen have good grades, they should also have a good reputation with all administrators. Students allowed the privilege of eating off campus must be doing well in school. Just like in sports, if you have two failing grades you can’t play, well, if you have two failing grades, you can’t eat out off school grounds. School comes first for every student and needing to do well in order to eat off campus could influence some low achieving students to do better in class. There also should be record on who goes in and out of school, since keeping track of students who leave school grounds is a concern. The remedy is to have a sign in sheet. If students did not sign in and out, then suspension or other consequences would be doled out. The object is not to give students a chance to have extra free time or skip classes but to have them do something different and enjoy their school lunch at the same time. How to cite Fun Time, Papers

Finance Management free essay sample

In a world without FIs the users of corporate funds in the economy would have to approach directly the household savers of funds in order to satisfy their borrowing needs. This process would be extremely costly because of the up-front information costs faced by potential lenders. Cost inefficiencies would arise with the identification of potential borrowers, the pooling of small savings into loans of sufficient size to finance corporate activities, and the assessment of risk and investment opportunities. Moreover, lenders would have to monitor the activities of borrowers over each loans life span. The net result would be an imperfect allocation of resources in an economy. 3. Identify and explain three economic disincentives that probably would dampen the flow of funds between household savers of funds and corporate users of funds in an economic world without financial intermediaries. Investors generally are averse to purchasing securities directly because of (a) monitoring costs, (b) liquidity costs, and (c) price risk. Monitoring the activities of borrowers requires extensive time, expense, and expertise. As a result, households would prefer to leave this activity to others, and by definition, the resulting lack of monitoring would increase the riskiness of investing in corporate debt and equity markets. The long-term nature of corporate equity and debt would likely eliminate at least a portion of those households willing to lend money, as the preference of many for near-cash liquidity would dominate the extra returns which may be available. Third, the price risk of transactions on the secondary markets would increase without the information flows and services generated by high volume. 4. Identify and explain the two functions in which FIs may specialize that enable the smooth flow of funds from household savers to corporate users. FIs serve as conduits between users and savers of funds by providing a brokerage function and by engaging in the asset transformation function. The brokerage function can benefit both savers and users of funds and can vary according to the firm. FIs may provide only transaction services, such as discount brokerages, or they also may offer advisory services which help reduce information costs, such as full-line firms like Merrill Lynch. The asset transformation function is accomplished by issuing their own securities, such as deposits and insurance policies that are more attractive to household savers, and using the proceeds to purchase the primary securities of corporations. Thus, FIs take on the costs associated with the purchase of securities. 5. In what sense are the financial claims of FIs considered secondary securities, while the financial claims of commercial corporations are considered primary securities? How does the transformation process, or intermediation, reduce the risk, or economic disincentives, to the savers? The funds raised by the financial claims issued by commercial corporations are used to invest in real assets. These financial claims, which are considered primary securities, are purchased by FIs whose financial claims therefore are considered secondary securities. Savers who invest in the financial claims of FIs are indirectly investing in the primary securities of commercial corporations. However, the information gathering and evaluation expenses, monitoring expenses, liquidity costs, and price risk of placing the investments directly with the commercial corporation are reduced because of the efficiencies of the FI. 6. Explain how financial institutions act as delegated monitors. What secondary benefits often accrue to the entire financial system because of this monitoring process? By putting excess funds into financial institutions, individual investors give to the FIs the responsibility of deciding who should receive the money and of ensuring that the money is utilized properly by the borrower. In this sense the depositors have delegated the FI to act as a monitor on their behalf. The FI can collect information more efficiently than individual investors. Further, the FI can utilize this information to create new products, such as commercial loans, that continually update the information pool. This more frequent monitoring process sends important informational signals to other participants in the market, a process that reduces information imperfection and asymmetry between the ultimate sources and users of funds in the economy. 7. What are five general areas of FI specialness that are caused by providing various services to sectors of the economy? First, FIs collect and process information more efficiently than individual savers. Second, FIs provide secondary claims to household savers which often have better liquidity characteristics than primary securities such as quities and bonds. Third, by diversifying the asset base FIs provide secondary securities with lower price-risk conditions than primary securities. Fourth, FIs provide economies of scale in transaction costs because assets are purchased in larger amounts. Finally, FIs provide maturity intermediation to the economy which allows the introduction of additional types of investment contracts, such as mortgage loans, that are financed with short-term deposits. 8. How do FIs solve the information and related agency costs when household savers invest directly in securities issued by corporations? What are agency costs? Agency costs occur when owners or managers take actions that are not in the best interests of the equity investor or lender. These costs typically result from the failure to adequately monitor the activities of the borrower. If no other lender performs these tasks, the lender is subject to agency costs as the firm may not satisfy the covenants in the lending agreement. Because the FI invests the funds of many small savers, the FI has a greater incentive to collect information and monitor the activities of the borrower. 9. What often is the benefit to the lenders, borrowers, and financial markets in general of the solution to the information problem provided by the large financial institutions? One benefit to the solution process is the development of new secondary securities that allow even further improvements in the monitoring process. An example is the bank loan that is renewed more quickly than long-term debt. The renewal process updates the financial and operating information of the firm more frequently, thereby reducing the need for restrictive bond covenants that may be difficult and costly to implement. 10. How do FIs alleviate the problem of liquidity risk faced by investors who wish to invest in the securities of corporations? Liquidity risk occurs when savers are not able to sell their securities on demand. Commercial banks, for example, offer deposits that can be withdrawn at any time. Yet the banks make long-term loans or invest in illiquid assets because they are able to diversify their portfolios and better monitor the performance of firms that have borrowed or issued securities. Thus individual investors are able to realize the benefits of investing in primary assets without accepting the liquidity risk of direct investment. 1. How do financial institutions help individual savers diversify their portfolio risks? Which type of financial institution is best able to achieve this goal? Money placed in any financial institution will result in a claim on a more diversified portfolio. Banks lend money to many different types of corporate, consumer, and government customers, and insuran ce companies have investments in many different types of assets. Investment in a mutual fund may generate the greatest diversification benefit because of the fund’s investment in a wide array of stocks and fixed income securities. 2. How can financial institutions invest in high-risk assets with funding provided by low-risk liabilities from savers? Diversification of risk occurs with investments in assets that are not perfectly positively correlated. One result of extensive diversification is that the average risk of the asset base of an FI will be less than the average risk of the individual assets in which it has invested. Thus individual investors realize some of the returns of high-risk assets without accepting the corresponding risk characteristics. 13. How can individual savers use financial institutions to reduce the transaction costs of investing in financial assets? By pooling the assets of many small investors, FIs can gain economies of scale in transaction costs. This benefit occurs whether the FI is lending to a corporate or retail customer, or purchasing assets in the money and capital markets. In either case, operating activities that are designed to deal in large volumes typically are more efficient than those activities designed for small volumes. 14. What is maturity intermediation? What are some of the ways in which the risks of maturity intermediation are managed by financial intermediaries? If net borrowers and net lenders have different optimal time horizons, FIs can service both sectors by matching their asset and liability maturities through on- and off-balance sheet hedging activities and flexible access to the financial markets. For example, the FI can offer the relatively short-term liabilities desired by households and also satisfy the demand for long-term loans such as home mortgages. By investing in a portfolio of long-and short-term assets that have variable- and fixed-rate components, the FI can reduce maturity risk exposure by utilizing liabilities that have similar variable- and fixed-rate characteristics, or by using futures, options, swaps, and other derivative products. 15. What are five areas of institution-specific FI specialness, and which types of institutions are most likely to be the service providers? First, commercial banks and other depository institutions are key players for the transmission of monetary policy from the central bank to the rest of the economy. Second, specific FIs often are identified as the major source of finance for certain sectors of the economy. For example, SLs and savings banks traditionally serve the credit needs of the residential real estate market. Third, life insurance and pension funds commonly are encouraged to provide mechanisms to transfer wealth across generations. Fourth, depository institutions efficiently provide payment services to benefit the economy. Finally, mutual funds provide denomination intermediation by allowing small investors to purchase pieces of assets with large minimum sizes such as negotiable CDs and commercial paper issues. 6. How do depository institutions such as commercial banks assist in the implementation and transmission of monetary policy? The Federal Reserve Board can involve directly the commercial banks in the implementation of monetary policy through changes in the reserve requirements and the discount rate. The open market sale and purchase of Treasury securities by the Fed involves the banks in the implementation of monetary policy in a less direct manner. 17. What is meant by credit allocation regulation? What social benefit is this type of regulation intended to provide? Credit allocation regulation refers to the requirement faced by FIs to lend to certain sectors of the economy, which are considered to be socially important. These may include housing and farming. Presumably the provision of credit to make houses more affordable or farms more viable leads to a more stable and productive society. 18. Which intermediaries best fulfill the intergenerational wealth transfer function? What is this wealth transfer process? Life insurance and pension funds often receive special taxation relief and other subsidies to assist in the transfer of wealth from one generation to another. In effect, the wealth transfer process allows the accumulation of wealth by one generation to be transferred directly to one or more younger generations by establishing life insurance policies and trust provisions in pension plans. Often this wealth transfer process avoids the full marginal tax treatment that a direct payment would incur. 19. What are two of the most important payment services provided by financial institutions? To what extent do these services efficiently provide benefits to the economy? The two most important payment services are check clearing and wire transfer services. Any breakdown in these systems would produce gridlock in the payment system with resulting harmful effects to the economy at both the domestic and potentially the international level. 20. What is denomination intermediation? How do FIs assist in this process? Denomination intermediation is the process whereby small investors are able to purchase pieces of assets that normally are sold only in large denominations. Individual savers often invest small amounts in mutual funds. The mutual funds pool these small amounts and purchase negotiable CDs which can only be sold in minimum increments of $100,000, but which often are sold in million dollar packages. Similarly, commercial paper often is sold only in minimum amounts of $250,000. Therefore small investors can benefit in the returns and low risk which these assets typically offer. 21. What is negative externality? In what ways do the existence of negative externalities justify the extra regulatory attention received by financial institutions? A negative externality refers to the action by one party that has an adverse affect on some third party who is not part of the original transaction. For example, in an industrial setting, smoke from a factory that lowers surrounding property values may be viewed as a negative externality. For financial institutions, one concern is the contagion effect that can arise when the failure of one FI can cast doubt on the solvency of other institutions in that industry. 22. If financial markets operated perfectly and costlessly, would there be a need for financial intermediaries? To a certain extent, financial intermediation exists because of financial market imperfections. If information is available costlessly to all participants, savers would not need intermediaries to act as either their brokers or their delegated monitors. However, if there are social benefits to intermediation, such as the transmission of monetary policy or credit allocation, then FIs would exist even in the absence of financial market imperfections. 23. What is mortgage redlining? Mortgage redlining occurs when a lender specifically defines a geographic area in which it refuses to make any loans. The term arose because of the area often was outlined on a map with a red pencil. 24. Why are FIs among the most regulated sectors in the world? When is net regulatory burden positive? FIs are required to enhance the efficient operation of the economy. Successful financial intermediaries provide sources of financing that fund economic growth opportunity that ultimately raises the overall level of economic activity. Moreover, successful financial intermediaries provide transaction services to the economy that facilitate trade and wealth accumulation. Conversely, distressed FIs create negative externalities for the entire economy. That is, the adverse impact of an FI failure is greater than just the loss to shareholders and other private claimants on the FIs assets. For example, the local market suffers if an FI fails and other FIs also may be thrown into financial distress by a contagion effect. Therefore, since some of the costs of the failure of an FI are generally borne by society at large, the government intervenes in the management of these institutions to protect societys interests. This intervention takes the form of regulation. However, the need for regulation to minimize social costs may impose private costs to the firms that would not exist without regulation. This additional private cost is defined as a net regulatory burden. Examples include the cost of holding excess capital and/or excess reserves and the extra costs of providing information. Although they may be socially beneficial, these costs add to private operating costs. To the extent that these additional costs help to avoid negative externalities and to ensure the smooth and efficient operation of the economy, the net regulatory burden is positive. 5. What forms of protection and regulation do regulators of FIs impose to ensure their safety and soundness? Regulators have issued several guidelines to insure the safety and soundness of FIs: a. FIs are required to diversify their assets. For example, banks cannot lend more than 10 percent of their equity to a single borrower. b. FIs are required to maintain minimum amounts of capital to cushion an y unexpected losses. In the case of banks, the Basle standards require a minimum core and supplementary capital of 8 percent of their risk-adjusted assets. c. Regulators have set up guaranty funds such as BIF for commercial banks, SIPC for securities firms, and state guaranty funds for insurance firms to protect individual investors. d. Regulators also engage in periodic monitoring and surveillance, such as on-site examinations, and request periodic information from the FIs. 26. In the transmission of monetary policy, what is the difference between inside money and outside money? How does the Federal Reserve Board try to control the amount of inside money? How can this regulatory position create a cost for the depository financial institutions? Outside money is that part of the money supply directly produced and controlled by the Fed, for example, coins and currency. Inside money refers to bank deposits not directly controlled by the Fed. The Fed can influence this amount of money by reserve requirement and discount rate policies. In cases where the level of required reserves exceeds the level considered optimal by the FI, the inability to use the excess reserves to generate revenue may be considered a tax or cost of providing intermediation. 27. What are some examples of credit allocation regulation? How can this attempt to create social benefits create costs to the private institution? The qualified thrift lender test (QTL) requires thrifts to hold 65 percent of their assets in residential mortgage-related assets to retain the thrift charter. Some states have enacted usury laws that place maximum restrictions on the interest rates that can be charged on mortgages and/or consumer loans. These types of restrictions often create additional operating costs to the FI and almost certainly reduce the amount of profit that could be realized without such regulation. 8. What is the purpose of the Home Mortgage Disclosure Act? What are the social benefits desired from the legislation? How does the implementation of this legislation create a net regulatory burden on financial institutions? The HMDA was passed by Congress to prevent discrimination in mortgage lending. The social benefit is to ensure that everyone who qualifies financially is provided the opportunity to purchase a house shoul d they so desire. The regulatory burden has been to require a written statement indicating the reasons why credit was or was not granted. Since 1990, the federal regulators have examined millions of mortgage transactions from more than 7,700 institutions each calendar quarter. 29. What legislation has been passed specifically to protect investors who use investment banks directly or indirectly to purchase securities? Give some examples of the types of abuses for which protection is provided. The Securities Acts of 1933 and 1934 and the Investment Company Act of 1940 were passed by Congress to protect investors against possible abuses such as insider trading, lack of disclosure, outright malfeasance, and breach of fiduciary responsibilities. 30. How do regulations regarding barriers to entry and the scope of permitted activities affect the charter value of financial institutions? The profitability of existing firms will be increased as the direct and indirect costs of establishing competition increase. Direct costs include the actual physical and financial costs of establishing a business. In the case of FIs, the financial costs include raising the necessary minimum capital to receive a charter. Indirect costs include permission from regulatory authorities to receive a charter. Again in the case of FIs this cost involves acceptable leadership to the regulators. As these barriers to entry are stronger, the charter value for existing firms will be higher. 31. What reasons have been given for the growth of investment companies at the expense of â€Å"traditional† banks and insurance companies? The recent growth of investment companies can be attributed to two major factors: a. Investors have demanded increased access to direct securities markets. Investment companies and pension funds allow investors to take positions in direct securities markets while still obtaining the risk diversification, monitoring, and transactional efficiency benefits of financial intermediation. Some experts would argue that this growth is the result of increased sophistication on the part of investors; others would argue that the ability to use these markets has caused the increased investor awareness. The growth in these assets is inarguable. b. Recent episodes of financial distress in both the banking and insurance industries have led to an increase in regulation and governmental oversight, thereby increasing the net regulatory burden of â€Å"traditional† companies. As such, the costs of intermediation have increased, which increases the cost of providing services to customers. 2. What are some of the methods which banking organizations have employed to reduce the net regulatory burden? What has been the effect on profitability? Through regulatory changes, FIs have begun changing the mix of business products offered to individual users and providers of funds. For example, banks have acquired mutual funds, have expanded their asset and pension fund management busin esses, and have increased the security underwriting activities. In addition, legislation that allows banks to establish branches anywhere in the United States has caused a wave of mergers. As the size of banks has grown, an expansion of possible product offerings has created the potential for lower service costs. Finally, the emphasis in recent years has been on products that generate increases in fee income, and the entire banking industry has benefited from increased profitability in recent years. 33. What characteristics of financial products are necessary for financial markets to become efficient alternatives to financial intermediaries? Can you give some examples of the commoditization of products which were previously the sole property of financial institutions? Financial markets can replace FIs in the delivery of products that (1) have standardized terms, (2) serve a large number of customers, and (3) are sufficiently understood for investors to be comfortable in assessing their prices. When these three characteristics are met, the products often can be treated as commodities. One example of this process is the migration of over-the-counter options to the publicly traded option markets as trading volume grows and trading terms become standardized. 34. In what way has Regulation 144A of the Securities and Exchange Commission provided an incentive to the process of financial disintermediation?