...ISLAMIC FINANCE: CAN IT BE A REMEDY FOR FINANCIAL CRISES? I. INTRODUCTION The financial system is at the heart of the modern economy. When this system works well, it enables to allocate resources that maximize the productivity of the economy. On the contrary when it does not work properly, the whole economy starts to decline. Because financial system must be considered as an in-built part of real economy in terms of credit mechanism. The recent global financial crisis began in August 2007 and after this time it spread gradually to the financial markets in the world. Although it is not severe as in its beginning phase but recovery is not but its aftershock is still going on. There has been numerous research conducted by many economists and analysts. According to the many of these studies, risky transactions, lack of surveillance, and greed that underlie this financial crisis. The relationship between Islamic finance and the financial crises has been discussed by many authors in some of these research. All those works has been done after the beginning of the global financial crisis. Thanks to its strength aspects include risk sharing mechanism, strict Sharia governance rules, tighter supervision and transparency policy, almost all of these works have been concluded that Islamic finance may make significant contributions to prevent financial crises like the current one. Also the reality of the limited impact of the current global financial crisis on Islamic Finance-based institutions...
Words: 3382 - Pages: 14
...Module 1 - The Accoutant As Strategic Business Adviser The Need For Advice 1.4 (9 issues small business entrepreneurs seek advice about - business structure, IP, liability, regulation, contracts, etc) 1.4 (Malach, Robinson & Radcliff 2006) 1.4 (business efficiency & productivity, management information systems, risk management & internal controls) 1.5 (strategic level - selecting appropriate growth strategies, identifying new products and markets, etc) 1.5 (the need for advice variety of reasons - consider the demand for advice arises) 1.5 (Xiao & Fu 2009) 1.5 Table 1.1 - Characteristics Of Different Sized Organisations 1.6 (SE MSE LE - organisation, strategy, customer/community, financial, governance, work force, IT processes) 1.6 Requests For Advice: Operational - Srategic - Global 1.7 (improving operational performance, greater strategic role, globally relevant issues) 1.7 Example 1.1: A Busniess Dilemma 1.7 Counterpoint (opposing arguement, soft skills, first: make the right decision about the services they perform - second:) 1.7 Providing And Implementing Advice (technical skills, soft skills) 1.8 Figure 1.1 - Providing Business Advisory Services 1.8 (issue, requirement, request, investigation, advice, decision, implementation) 1.8 (recommend actions should be well supported, identify key stakeholders) 1.9 Figure 1.2 - The Chain Of Events For Business Advisory Services) 1.9 Example 1.2: Succession Plan - Please Help 1.9 ...
Words: 7475 - Pages: 30
...do more international trade, it will make the globalization and the globalization has more benefits. For example, it can reduce the goods costing, which some countries can open the factories on China. However, the globalization has some disadvantages. For example, the global financial crisis occurred on 2008. This essay is going to analyses how globalization and global financial crisis in the business environment impact on the organization you work in and the tasks you undertake. The globalization refers to the system of contact among the countries of the world in order to improve the global economy. The globalization is the amalgamation of economics and societies all over the world. Globalization including economic, technological, political, and cultural exchanges made possible largely by advances in communication, transportation, and infrastructure (Hotbabefacthicks, 2010). The global financial crisis refers to a widespread economic emergency that began in 2007. Beginning with the crash of the United States financial system, the crisis quickly spread worldwide, thanks to the interconnected marks of modern global trading systems. It is still impossible to fully explain the effects of the global financial crisis, as the disaster continues to damage and impede markets worldwide even several years after the initial event (wiseGEEK, 2003-2012). To make the information more clear, we have an interview with two businesses Page 1 people, first...
Words: 1357 - Pages: 6
...today's viewpoint Financial Crisis It’s commonly believed that the financial crisis happened during 2008~2009 is one of the most serious financial events in human history. A collapse of the US sub-prime mortgage market and the result of the housing boom in other industrialized economies have had a ripple-effect around the world. Furthermore, the other failures in the global financial system have surfaced. Some financial products and instruments have become so complex and twisted, that as things start to unravel, trust in the whole system started to fail. All of this comes at a price From 2006 to 2009, our economic world have been changed. Comparing the activities of 2006 and 2009. first, real GDP was essentially unchanged, making 2006-2009 the worst three-year period science 1946-1948. in spite of an essentially zero increase in production for the 2006-2009 period, personal consumption grew by almost 2 percent. however, private investment fell by more than 30 percent. on the other hand, the banks charged off $27 billion in bad bet for 2006, but this exploded to $191 billion in 2009. personal and business bankruptcies field in federal courts accelerated dramatically over the 2006-2009 period, with personal bankruptcies increasing by 136 percent, while business bankrupts increased by 209 percent. Since the outbreak of the financial crisis, the American banking system and the whole financial industry's problems have been exposed: many United States financial institutions went...
Words: 899 - Pages: 4
...| About IMF The International Monetary Fund (IMF) works to bring up International Monetary Cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth and to reduce the poverty around the world. IMF was created in 1945 and it’s an organization of 187 countries. Why IMF was created and how it works? The IMF, also known as the “Fund,” was conceived at a United Nations conference convened in Bretton Woods, New Hampshire, United States, in July 1944. The 44 governments represented at that conference sought to build a framework for economic cooperation that would avoid a repetition of the vicious circle of competitive devaluations that had contributed to the Great Depression of the 1930s. Work of IMF The primary mission of the IMF is to provide financial assistance to countries those countries who experience financial and economic difficulties and to sought those difficulties they are given financial help by using funds deposited with the IMF from the institution’s 187 member countries. Member of IMF states with balance of payments problems, which often arise from these difficulties, may request loans from IMF to help fill gaps between what countries earn and/or are able to borrow from other official lenders and what countries must spend to operate, including covering the cost of importing basic goods and services. In return, countries are required to launch certain reforms which have often been dubbed...
Words: 4899 - Pages: 20
...future of our world economic? And where are we now? In this essay I’m dividing the process of globalization into three stages which are globalization, deglobalization and reglobalization. Every stage on globalization process had caused many changes in global world. I’m going to explain when, why, and how each stage of globalization affect the world. Let me started with the first stage which is what we called as “Globalization”. We can describe Globalization as “A widening, deepening and speeding up of worldwide interconnectedness in all aspects of contemporary social life such as economic, politic, and culture. It took place about a century ago between roughly 1850 and the start of World War I in 1914. We can defined "economic globalization" as the opening and deregulation of commodity, capital and labor markets which led to the present neoliberal globalization. "Political globalization" named the emergence of a transnational elite and the phasing out of the nation-state. "Cultural globalization" was the worldwide homogenization of culture. Globalization happened when transport costs rapidly declined making it economically efficient to boost international trade. In globalization, political leadership was critical in shaping global institutions and norms in a pro-trade direction. Globalization happened because countries are willing to expand their influence around the world, they want more sources, and they need to gain more in economic, social, even in political dimensions....
Words: 3579 - Pages: 15
...Strategy Map – DEPARTMENT – Funds Department The following illustration depicts the strategy map of the DEPARTMENT – Funds (R&S) Department. The business unit, reports under the Financial and Distribution Services Division of DEPARTMENT. The key responsibilities of the Funds Department is to facilitate the collection of sales amounts due from Travel Agents, and settling of the funds due to Airlines, this process is done through the Hinge Bank Account while ensuring the funds of the Airlines are safeguarded against any risk. The business unit is comprised of a Central Team in XXXX, managing the coordination and development of the process, combined with a Regional Team responsible for execution of the daily operations. The development of the strategy map, allows the Funds department to address the following areas: ➢ Identification and Alignment of the Funds objectives with the “DEPARTMENT Strategic House” and Vision. ➢ Communication Tool to allow the stakeholders to understand the key areas the department are focusing on. ➢ Identifying the cause and effects of implementing certain processes and strategies, and how this would contribute to driving the organizational objectives. [pic] [pic] Learning and Growth Perspective People, Performance & Development: ➢ One of the key objectives of DEPARTMENT is to deliver its mission, by making the organization a great place to work through living and upholding its values on an everyday...
Words: 1926 - Pages: 8
...Global Financing and Exchange Rate Mechanisms Global Financing and Exchange Rate Mechanisms International financial institutions are very important for the world to function. International institutions provide capital, improves the standards of living in developing countries. International institutions include World Bank, IMF, and the regional development banks. This essay defines the roles of international financial institutions; as well as how they are used in financing operation. International financial comes with risk and the importance of managing the risk. Roles of international financial insititutions The role of international financial institutions is firm so that we can move forward to expanding to additional countries. The role of international financial institutions is to providing financial support and stable advice for project in developing countries. The role of international financial institutions is to provide stability in the developing countries. The role includes being governed by international laws because it involves more than one country. The international financial also supports the private sector in struggling countries by providing support and give initiatives to help the developing countries such as Africa. The international institutions provide loans and other aids to the countries ("Unisdr", n.d.). For example, with the Keystone pipeline project; this is project that is head by a company called TransCanada. Canada...
Words: 734 - Pages: 3
...globalization. This paper will outline the impact of globalization in the context with the international business. The information will be useful as it will highlight the issues that are closely related to globalization and identify the existing gaps. A valid conclusion will be drawn with the recommendation that should be considered in future researches as far as international business is concerned. Technology and policies will be referenced in the explanation of how financial flows, foreign direct investment and the international trade liberalization have evolved. The discussion will therefore be based on how the changes that have been brought by globalization have influenced international business in various ways. Trade The world trade is on rapid expansion when compared to the gross domestic product. This has been manifested over the past two decades when the globalization was rampant. However while the impact of globalization was meant to bring more economic prosperity by increasing the competition of the products in the global market, the effect is not uniform. This therefore means that the benefits that are associated with the expansion of trade in the world are not shared by all the states. In fact, a research conducted in the sub Saharan and least developed countries showed that the products from the regions faced decreased market share. The unequal enjoyment of the trade liberalization benefits could only...
Words: 2661 - Pages: 11
...Global Finance Environment Paper FIN/403 May 4, 2008 Globalization refers to the merging of national markets into one huge global marketplace. In today’s market, selling internationally is much easier due to falling barriers in cross-border trade. Now businesses don’t have to be industry giants to operate and succeed in global markets. Although it can be beneficial to offer a standard product that can be used worldwide, significant differences still exist between national markets such as cultural differences, consumer taste differences, product preferences and legal regulations. It is important to define and understand these differences when merging into national markets. Globalization is inevitable and it’s happening at an astonishing speed in nearly every market possible. The technology era that we are in has enabled businesses to join forces like never before and we are seeing significant changes in the global marketplace. There are main drivers in globalization and this paper will define three of them, as well as describe the risks associated with financial investing, and explain the importance of cultural sensitivity and ethics in global finance. Drivers of Globalization Market drivers Domestic markets are saturated and growth opportunities are often times limited. Expanding globally opens up many new opportunities allowing for real growth within a business. The following lists in detail the specific market drivers that play a key role...
Words: 1180 - Pages: 5
...their business. JPMorgan raised more than $2.1 trillion in capital for its clients, and more than $75 billion of these capital expenditures went to nonprofit and government entities. Since the 2004 merger with Bank One, JPMorgan has done well against other financial companies and performed slightly below the S&P 500. The company’s tangible book value per share has steadily increased over time, showing a promising future for JPMorgan. Legal and regulatory costs have decreased the value of JPMorgan’s stock, which has lead to a lower price/earnings ratio. Though these legal matters have presented a formidable obstacle, JPMorgan is determined to overcome them over time to make sure the quality of its business shines. Overall, JPMorgan’s four franchises have strengthened their leadership positions, increased their market share, and have continued to deliver on their commitment to improve customer satisfaction and foster innovation. Scope The data and analysis within this report comes from the audited financial statements by PricewaterhouseCoopers for the fiscal year ending December 31, 2014. Findings 1) JPMorgan has an outstanding franchise that has emerged as an endgame winner a) Recent JPMorgan financial results have shown its great ability to adapt to both marketplace and...
Words: 1222 - Pages: 5
...Session 3 Gregory W. Noble and John Ravenhill, “Cause and Consequences of the Asian Financial Crisis,” in Gregory W. Noble and John Ravenhill, eds., The Asian Financial Crisis and the Architecture of Global Finance, ed., Cambridge, 2000, pp. 1-35 [pic] Summary: The Asian financial crisis resulted from the sudden flight of large amounts of capital from Asian countries that lacked adequate systems of prudential regulation, and whose foreign exchange rate proved disastrously brittle. The crisis was unique in its unprecedented severity of corporate distress and banking sector problems, and its quickness in recovery from the crisis. While technical improvements in the financial system were institutionalized, the crisis did not bring fundamental structural revisions, in both political and economic arena. Doughty resistance from entrenched ideologies and interests in the U.S, the U.K, and the IMF prevented the reforms and rearrangements in the international financial system from happening. ➢ The East Asian crisis---the severest jolt to the world economy since the Oil Shock in early 1980s. ➢ Asian Crisis ---spread from Thailand to Indonesia, the Philippines, Malaysia and Korea. Sequences---Export decline ( loss of investors’ confidence( Currency devaluation due to lack of foreign reserve( IMF emergency fund requiring tight budget and monetary policy( increase in non-performing loans and damage in domestic industries ➢ Drastic increase in international private capital...
Words: 984 - Pages: 4
...UNIVERSITY OF NAIROBI SCHOOL OF BUSINESS MASTER OF BUSINESS ADMINISTRATION TERM PAPER TOPIC: ISSUES IN GLOBAL BUSINESS MANAGEMENT DSM 602: By DR. YABS NGETICH MONICAH D61/69197/2013 INTRODUCTION The scope of strategic business issues faced by companies and organizations striving to operate and be successful internationally has widened due to an increasingly broad geographic scope and the increasing complexity of technology. Strategic issues arise not only through the formal, periodic strategic planning processes in companies but also can, and quite often do arise unpredictably due to new insights, unexpected advances in technology or competitive activities in the market place. All companies have their way of identifying and dealing with these being their most critical strategic questions. However, theprocess of managing emerging strategic issues is typically non-structured, not necessarily optimally suited to enable the effective identification of the most critical questions and the appropriate allocation of top management attention and corporate intelligence support to answer the identified strategic questions. Despite the past research during 1960s, 1970s, and 1980s into the domain of strategic issues (SI), strategic issue management (SIM), and strategic issue management systems (SIMS) there is a scarcity applicable approaches for firms to use in improving their attention focus and distribution in strategic issue management processes. The underpinnings of strategic management...
Words: 4553 - Pages: 19
...NAME : JAWAD KARIMI ID NUMBER :05048569 INSIDE JOB: Inside Job is a 2010 documentary film about the late 2000’s financial crisis . The film is in five parts the film explores how changes in the policy environment and banking practices helped create the financial crisis. The movie starts with showing the Iceland bank where it all started from the land scape is shown green and fresh but then as the corporations moves into the country it becomes muddy and dry land with pollution. In a context of global economic crisis, everyone appears to be blaming the other in order to find who is responsible for such a global decline in growth, important rate of unemployment, rising protectionism... Thus, it seems relevant to wonder about the key stages of what has been called “The Great Recession” which began approximately on 15th September 2008 with a huge “domino effect” that was born right after the US government allowed the investment bank Lehman Brothers to go bankrupt. Indeed, the American firm implanted in London did not follow UK law, which caused its loss and is one of the numerous convincing facts showing that economic issues are directly linked to business law. After that, people started looking for elements that should have alarmed them. The example of the Greenbury Report (published in 1995) was destabilizing since it showed that corporate governances were already concerned about excessive executive remuneration because of previous cases...
Words: 1673 - Pages: 7
...Detail of Service sector from 2009-10 Name: Shiva Kr. Yadav Roll No. 11316603911 SERVICES SECTOR: INTERNATIONAL COMPARISON Conventional wisdom suggests that during the early development phase of any country, expansion of output in manufactured goods precedes growth in the services sector. As a country progresses further manufacturing often takes a back seat, giving way to the services sector in terms of both output and employment, and manufacturing firms themselves become increasingly service centric in order to remain competitive. Some have argued that the decline in manufacturing and corresponding shift to services is unsupportable in the long run as services depend critically on manufacturing for their demand. Although this argument may be applicable for certain services such as retailing and transportation, it does not entirely hold for many other services. IT in particular very high services sector growth. Russia at 5.5 per cent and Brazil at 4.0 per cent are a distant third and fourth respectively. While India’s growth rate of the services sector at 10.1 per cent in 2009 was higher than that of China at 9.6 per cent, in 2010 it has decelerated to 7.7 per cent while China’s has remained constant (Table 10.1). All this highlights the prominence of the services sector for India. Despite the higher share of services in India’s GDP and China’s dominance in manufacturing over...
Words: 2264 - Pages: 10
