Premium Essay

Finance Major

In: Business and Management

Submitted By noors
Words 2608
Pages 11
MBA 613, Investment Analysis

case study, Subprime Meltdown: American Housing &
Global Financial Turmoil

Dr. Farooq Malik
Noor

Main Problems:
1. Financial crisis
2. Before 1990’s many households went into default.
3. In early 2008, the most immediate problem was a wave of foreclosures
4. In 1996 accelerated in average house prices across the United States had risen fairly to reach about 12 percent per annum in late 2005. After this, there was anxiety about inflation and interest rates were increased steadily, with the Federal Funds rate reaching 5.25% in September 2006.
5. Failure of about half of the 32,234 Savings and Loan Associations “S&L’s” that existed in 1986.
6. In 2006, credit risk.
7. Losses of billions
8. subprime crisis

Main Cause of the problems:
1. Failure of the financial system in planning and managing the system
2. During the Great Depression, refinancing became difficult. Lenders mostly offered short-term mortgages that needed to be refinanced because they had “balloon” payments at the end.
3. US system for financing home purchases had gone wrong, what had appeared to be a glorious housing boom.
4. Rise in prices was due in part to the Federal Reserve’s policy of maintaining low interest rates after the 2001 recession. Fearing a recession that did not materialize made the Fed keeps interest rates low to be set to only 1 percent from July 2003 to July 2004. In spite of signs of growth in output and prices.
5. S&Ls is about originating fixed 30-year mortgages to be held to maturity. When short-term interest rates rose in the early 1980’s, the yield on mortgage assets fell below the cost of paying depositors for their funds. This mismatch caused considerable losses.
6. Maximum loan for single-family homes was $417,000. borrowers has problematic credit histories
7. The financial system was

Similar Documents

Premium Essay

Jfijofjw

...STRONG ASSIGNMENT Career Exploration The purpose of this assignment is for you to critically reflect upon the results of your Strong Interest Inventory, as well as to explore any pre-existing majors or occupations of interest. For this assignment, you will identify and examine majors and occupations to begin evaluating how they may fit with your interests, abilities, or values. Part 1: Objective: To identify the details of occupations of interest to you and to begin evaluating how they fit with your interests, abilities, or values. (3 points) Directions: Use the Occupational Outlook Handbook to research and indicate 5 items for each of the categories in the tables below. At least one of the occupations you research must derive from the results of your Strong Interest Inventory. • Occupational Outlook Handbook: http://www.bls.gov/ooh/ OCCUPATION #1: ______Financial Manager__________ | |What They Do/ Duties |How To Become One/ Education |How To Become One/ Important Qualities |Work Environment/ Work Schedule | |1. |Responsible for financial health of | |Have to have a lot of previous experience in the |Works typically in an office or bank setting | | |organization |Bachelor’s degree |financial world to be successful ...

Words: 1961 - Pages: 8

Free Essay

Career

...on the consideration of ‘how much money will I earn in future through this career’ can lead to a student choosing a career that although offers money but rather leads to dissatisfaction in the long term. This does not imply that money is not to be considered at all. It simply means that a student choosing between different options should keep a balance between both interest and earning capability when selecting a career. It would be rather foolish of someone to choose a career that is although based on interest, has little or no market value at all. That interest can then be pursued as a hobby but not as a career. What is rather an important consideration in choosing the right career is whether enough finance is available to undertake that degree. Although lack of finance could be a detrimental factor to a student, nowadays different scholarships are available that one can avail. Taking into account all these different elements a student can then make a list of available options and then start narrowing them down based on further research done such as opinion from peers or those already engaged in the respective fields. A glance at the job market could also give an idea of which degrees are highly in demand nowadays. The...

Words: 452 - Pages: 2

Free Essay

College Course

...environmental precautions and methods | | |   | Organization/Development20 Percent | Points Available2 | Points EarnedX/2 | Additional Comments: | * Paper is 350 to 700 words in length. * Paragraph transitions are present, logical, and maintain the flow throughout the paper. * The tone is appropriate to the content and assignment. * Sentences are complete, clear, and concise. * Sentences are well constructed, strong, and varied. * Sentence transitions are present and maintain the flow of thought. * The paper develops a central theme or idea directed toward the appropriate audience. * The introduction provides sufficient background on the topic and previews major points. * The conclusion is logical, flows from the body of the paper, and reviews the major points. * Major points are stated clearly; are supported by specific details, examples, or analysis; and are organized logically. | | |   | Mechanics 20 Percent | Points Available2 | Points EarnedX/2 | Additional Comments: | * The paper—including tables and graphs, headings, title page, and reference page—is...

Words: 300 - Pages: 2

Premium Essay

Big Data

...1 INTRODUCTION The purpose of this paper is to examine the definition of big data. It also seeks to examine the components of a Unified Data Architecture and its ability to facilitate the analysis of big data. 2 WHAT IS BIG DATA Cuzzocrea, Song and Davis (2011) defined big data in part as being “enormous amounts of unstructured data produced by high-performance applications falling in a wide and heterogeneous family of application scenarios”. In recent years there has been an increasing interest and focus on big data. Many and varied definitions have been proposed but without a consensus on a single definition. The MIT Technology Review (2014), brought attention to the work of Ward and Barker (2014) which examined a number of definitions of big data that have attracted some general ICT industry support from leading ICT industry analysts and organisations such as Gartner, Oracle and Microsoft. In their work they proposed to provide a “concise definition of an otherwise ambiguous term”. The author having just attended a digital government conference with a large proportion of big data tagged presentations also noted that no single definition was offered. There was however a common content theme that supported the Ward and Barker definition of: “Big data is a term describing the storage and analysis of large and or complex data sets using a series of techniques including, but not limited to: NoSQL, MapReduce and machine learning.” 3 UNIFIED DATA ARCHITECTURE 3.1...

Words: 579 - Pages: 3

Premium Essay

Blah

...Grading Criteria Food Borne Illness Paper This assignment is due in Week Four. |Content |Points |Points |Additional | |60 Percent |Available |Earned |Comments: | | |6 |X/6 | | |All key elements of the assignment are covered in a substantive way. | | |  | |The content is comprehensive, accurate, and persuasive and includes the following: | | | | |Identification of the infectious agent (pathogen)—for example, the name of the bacteria, | | | | |virus, or parasite | | | | |Explanation of how the infectious agent is transmitted through food or water | | | | |An example of a real outbreak in the United States | | | | |Description of the clinical symptoms, duration of the disease, and treatment if any | | | ...

Words: 308 - Pages: 2

Free Essay

Arketing Case Study

...It is not easy to find out as to who contributes and who has the control on the attrition of employees. Various studies/survey conducted indicates that everyone is contributing to the prevailing attrition. Attrition does not happen for one or two reasons. The way the industry is projected and speed at which the companies are expanding has a major part in attrition. For a moment if we look back,did we plan for the growth of this industry and answer will be no. The readiness in all aspects will ease the problems to some extent. In our country we start the industry and then develop the infrastructure. All the major software companies have faced these realities. If you look within, the specific reasons for attrition are varied in nature and it is interesting to know why the people change jobs so quickly. Even today, the main reason for changing jobs is for higher salary and better benefits. But in call centers the reasons are many and it is also true that for funny reasons people change jobs. At the same time the attrition cannot be attributed to employees alone. The employees always assess the management values, work culture, work practices and credibility of the organization. The Indian companies do have difficulties in getting the businesses and retain it for a long time. There are always ups and downs in the business. When there is no focus and in the absence of business plans, non-availability of the campaigns makes people too quickly move out of the organization. Working environment...

Words: 329 - Pages: 2

Premium Essay

Geopolitics in Euro-Mediterranean Area

...EURO-MEDITERRANEAN AREA Introduction Since several centuries, The Euro-Mediterranean Area has always been the center of the world, geopolitically speaking, representing a major hub when it comes to political interactions, commercial alliances, diplomatic communication and socio-cultural connections. The appellation of United States of Europe can highlight the crucial importance of these nations and the impact of its cooperation and interactions at the international level. In July 13th 2008, Nicolas Sarkozy had triggered a process that led to the Union for the Mediterranean that became today a huge union between countries all around the world, over and above the Mediterranean Sea, attesting of the tremendous magnitude of its geopolitical power. To me, the major objective of this Union should be conducted by a real long-term geopolitical, economic and socio-cultural strategy aiming the promotion of the economical integration and democratic reforms among and between Euro-Mediterranean nations. Since this geopolitical area is highly characterized by an ambient heterogeneity, between North Nations and South Nations in one hand, between wealthy powers, and more underprivileged countries on the other hand, economical and socio-cultural disparities between different geopolitical regions seems to me that they represent the 1st major problem and geopolitical challenge. Indeed, this inevitable battle for a homogeneous united geopolitical area can be a capital step that will lead us to a troubleshooting...

Words: 600 - Pages: 3

Premium Essay

Case Analysis 16

...school, he walks through the doors of the Campus Career PlanningCenter and meets Elizabeth Merryweather, a recent graduate overflowing with energy and comforting smiles. Brent explains to Elizabeth that since he is graduating in December and plans to begin work in January, he wants to leave all of November and December open for interviews. Such a plan means that by October 31 he has to have all his preliminary materials, such as cover letters and résumés, submitted to the companies where he wants to work. Elizabeth recognizes that Brent has to follow a very tight schedule, if he wants to meet his goal within the next 60 days. She suggests that the two of them sit down together and decide the major milestones that need to be completed in the job search process. Elizabeth and Brent list the 19 major milestones. For each of the 19 milestones, they identify the other milestones that must be accomplished directly before Brent can begin this next milestone. They also estimate the time needed to complete each milestone. The list is shown below. In the evening after his meeting with Elizabeth, Brent meets with his buddies at the college coffee house to chat about...

Words: 714 - Pages: 3

Free Essay

If I Were Mayor

...the Mayor of Burleson, I would take every advantage of it. Being the Mayor comes with great authority and also great responsibility and I would use both of these traits in order to achieve my goals. To start off, if I were mayor I would try to focus on and improve the marketing, advertisement, and publication concerning community wide events and fundraisers. I would work to help reach out to the youth of Burleson so that our generation can become more involved with our community at a younger age. Getting the teenagers and children to participate in community events is vital to contributing to the major goals of our community and to helping Burleson thrive and grow. In addition to connecting the youth to the community, I would also pass an ordinance to raise fines for littering across our town. In continuing to unite the community of Burleson, keeping this city beautiful plays a major part. Littering is just one way in which our town becomes less unified, so I would fight to stop this disrespect of our city. I would also try to organize more money into a budget for making our city more beautiful. This budget would cover more landscaping and maintenance projects across the community. Another thing I would do as mayor would be to set aside more money in our budget to go towards our city’s drug awareness program. It is sad heart-breaking and devastating to see so many of our promising teenagers and young adults turning to drugs, alcohol, and substance abuse. In strengthening this...

Words: 380 - Pages: 2

Free Essay

Manager Behavior

...FROM: David Spencer SUBJECT: Acquisition I am delighted to announce that InterClean, Inc. has officially acquired EnviroTech, one of our major domestic competitors in the corporate market. With this acquisition, InterClean has taken a giant step in achieving domestic market dominance in the sanitation industry. More than that, the service expertise that comes with EnviroTech dovetails perfectly with our new strategic direction. With that expertise and InterClean’s resources, we fully expect to reach our sales goals for the next year, which should increase profitability by 40 percent. This is exciting news, indeed. Over the next four months, we will be working to merge about 60 EnviroTech sales staff and operations specialists into the InterClean structure. This will roughly coincide with the launching of our major media blitz to announce our new service focus. I hope you’ll join me in welcoming the EnviroTech staff into the InterClean family. I expect all management personnel to begin integration efforts immediately. MARCH 8, 2005 MEMORANDUM*** TO: Tom Jennings, Janet Durham FROM: Sam Waters SUBJECT: Compliance Issues My staff and I have been working on identifying a broad set of compliance issues, knowledge of which will be essential in a solutions-based selling market. For 10 of the major markets InterClean serves or would like to serve, we looked at the environmental regulations and local sanitation standards and found numerous technical specifics that...

Words: 301 - Pages: 2

Premium Essay

Futronics Case Study

...efficiency which will free a buyer up to engage in additional analytical purchasing work. * Discontinuance of the stores operation will virtually eliminate the time requirements for supervision of the operation.  Similar to item number 4 above , this additional time can be used by purchasing personnel to do a more productive and professional job of purchasing. * Futronics now has 42 operating sites.  As the organization continues to grow, delivery of materials to these sites will become more costly and more troublesome to manage. Generally speaking, one would expect the supply houses to be better equipped to handle material delivery operations effectively. Potential disadvantages of purchasing outside store services: * The major disadvantage of...

Words: 1261 - Pages: 6

Free Essay

Virtual Field Trip

...Virtual Field Trip Project |Grade Level: 6th | |Topic: Pearl Harbor | |Standards: | |USII.7 The student will demonstrate knowledge of the major causes and effects of American involvement in World War II by | |a) identifying the causes and events that led to American involvement in the war, including the attack on Pearl Harbor; | |b) locating and describing the major events and turning points of the war in Europe and the Pacific; | |c) Describing the impact of the war on the home front. | | | |Objective: Learn more on attack of Pearl Harbor and what it looks like today. ...

Words: 260 - Pages: 2

Premium Essay

Pepsico Case

...venturesome. Such issues might serve a particular market niche, for example, energy drinks or developing overseas markets. Generally, the group turns in a steady performance throughout the business cycle, but it will generally suffer in the most stressful of economic times PepsiCo is one of the largest food and beverage companies in the world. Its products include a variety of salty, sweet, and grain-based snacks as well as Csds and non-Csds. the company is responsible for the manufacturing, marketing, and sales of these goods. It has 18 brands in its portfolio and is headquartered in New York. PepsiCo has two divisions: bottle soft drinks and juice segment. In India the consumption proportion of both divisions are good as compare to the major competitor. PepsiCo have invested around 12000 crore in India and has the most of the market share in India in beverages industry. Mr. Anil R the Senior Manager of the organized trade handles the...

Words: 741 - Pages: 3

Premium Essay

Advanced Laser Clinics Case Questions

...1. What are the major issues in this case? What should Elizabeth Ryan do? The major issues of the case are employee dissatisfaction, hygiene, employee conflict, poor management, interpersonal relations and customer dissatisfaction. It can be clearly seen from the major issues why this particular clinic is not doing well. Elizabeth Ryan needs to change and organize the clinic operations. The management structure is not well defined, the first thing Elizabeth Ryan in management change should do is to define and properly state the formal chain of command between different levels of authority, for example based on experience the senior and junior technicians role can be established. She needs to revamp the clinic’s marketing strategies and start advertising its services. Running a brand solely on word to mouth marketing is not effective as well as efficient. One of the difficult responsibility she needs to deal with is her problem employee Moore, which is leading to productivity issue, morale problems, poor quality of treatment and customer dissatisfaction, which is turning out to be the most pressing issue of all and it is also clear that it will be impossible to go ahead with other changes until this one is dealt with. Elizabeth Ryan will have to raise her employee Gulford’s morale, as she is the one who is handling all the heavy workload. By resolving the employee conflict above, she can improve the work environment and raise the clinic’s performance and ultimately customer...

Words: 433 - Pages: 2

Free Essay

Form

...(Mr/Mrs/Miss/Ms) Surname* Name in Chinese* (if applicable) Nationality* Please select Given Name* Place of Birth Contact Phone No. (e.g. +852 9123 4567) Email Address Residential Address Do you require a Work Visa to work in Hong Kong? (Please “” where appropriate) Is this your first application to the HKEx Management Trainee Programme? (Please “” where appropriate) Yes No Yes No * As shown in HKID / Passport Management Trainee Programme 2015 – Application Form 1 of 5 Part II – Tertiary Education (i) First Bachelor Degree University / Institution Country Degree Attained / To be Attained Field of Study Mode of Attendance Please select (Full-time/Part-time) Year Attained / Please select To be Attained (1st major, if applicable) (2nd...

Words: 732 - Pages: 3