Sunday, January 31, 2010

US is capable of dealing with financial crisis


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World is in historic financial and economic crisis. these are very serious but US is going to held things back soon. Since Obama took over, his prime focus was US economy and all the world is looking towards US.

US and its allieds have still to do alot but they are going in the right direction in the present scenerio. Best of luck to all the nations.

Monday, January 18, 2010

Economy of India And China, a comparison


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One of my blogger friend asked me to compare the India's economy with that of China.
I think there is lot to say about it....

China is going to cross US in Next twenty five years. India, whose economy is already discussed that 45% people live in a miserable life and earn less than a dollar a day. This is a miserable situation in the whole sub-Continent, Even Srilanka, Nepal And Bhutan are far more ahead of India in the economic sector.

What India is doing mean while...???
Nothing except threatening Pakistan And we all know that wars are not a solution. We have to improve our economy if we want to challenge China and Pakistan.

Pakistan's economy is also better than India. India government is just giving attentions to its war technology which is not a big issue. Pakistan is also improving it in collaboration with China.

China's economy can be explained in one sentence. When Pakistan asked China for financial help, China replied, "We are going to do nothing except improving our economy till 2025.

India and China has no comparison in this field...

Saturday, January 9, 2010

The Federal Reserve system


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Fractional-reserve banking is the banking practice in which banks keep only a fraction of their deposits in reserve (as cash and other highly liquid assets) and lend out the remainder, while maintaining the simultaneous obligation to redeem all these deposits upon demand Fractional reserve banking necessarily occurs when banks lend out any fraction of the funds received from deposit accounts. This practice is universal in modern banking, and is to be contrasted with full-reserve banking which died out over two centuries ago.

By its nature, the practice of fractional reserve banking expands money supply (cash and demand deposits) beyond what it would otherwise be. Because of the prevalence of fractional reserve banking, the broad money supply of most countries is a multiple larger than the amount of base money created by the country's central bank. That multiple (called the money multiplier) is determined by the reserve requirement or other financial ratio requirements imposed by financial regulators, and by the excess reserves kept by commercial banks.

Central banks generally mandate reserve requirements that require banks to keep a minimum fraction of their demand deposits as cash reserves. This both limits the amount of money creation that occurs in the commercial banking system, and ensures that banks have enough ready cash to meet normal demand for withdrawals. Problems can arise, however, when a large number of depositors seek withdrawal of their deposits; this can cause a bank runor, when problems are extreme and widespread, a systemic crisis. To mitigate these problems, central banks (or other government institutions) generally regulate and oversee commercial banks, act as lender of last resort to commercial banks, and also insure the deposits of the commercial banks customers.

What is the Fractional resereve banking system.....??


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Fractional-reserve banking is the banking practice in which banks keep only a fraction of their deposits in reserve (as cash and other highly liquid assets) and lend out the remainder, while maintaining the simultaneous obligation to redeem all these deposits upon demand Fractional reserve banking necessarily occurs when banks lend out any fraction of the funds received from deposit accounts. This practice is universal in modern banking, and is to be contrasted with full-reserve banking which died out over two centuries ago.

By its nature, the practice of fractional reserve banking expands money supply (cash and demand deposits) beyond what it would otherwise be. Because of the prevalence of fractional reserve banking, the broad money supply of most countries is a multiple larger than the amount of base money created by the country's central bank. That multiple (called the money multiplier) is determined by the reserve requirement or other financial ratio requirements imposed by financial regulators, and by the excess reserves kept by commercial banks.

Central banks generally mandate reserve requirements that require banks to keep a minimum fraction of their demand deposits as cash reserves. This both limits the amount of money creation that occurs in the commercial banking system, and ensures that banks have enough ready cash to meet normal demand for withdrawals. Problems can arise, however, when a large number of depositors seek withdrawal of their deposits; this can cause a bank runor, when problems are extreme and widespread, a systemic crisis. To mitigate these problems, central banks (or other government institutions) generally regulate and oversee commercial banks, act as lender of last resort to commercial banks, and also insure the deposits of the commercial banks customers.

PAYPAL mafia


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The PayPal Mafia is a community of American business people and investors centered in Silicon Valley, who were founders or early employees of e-commerce service PayPal before founding a series of other technology companies. The PayPal Mafia are often credited with inspiring Web 2.0, and for the re-emergence of consumer-focused Internet companies after the dot com bust of 2001. Some commentators consider these credits to be exaggerated or partly mythologized.

Tuesday, January 5, 2010

138 banks in USA went bankrupt in 2009


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United States is in big financial crisis. Even in the last week of 2009 i.e 53rd week 7 more banks went bankrupt and total bankrupt banks have reached the figure of 138.
It is not over yet more banks have chance. President Obama has got a big challenge ahead of him.2009 is was the worst, now what about the 2010. It could be the same.
United States have big challenge infront of it. Fight against terrorism and bad economic conditions. Two big challenges....
Can Obama handle it???
Its a big question.....

RU3QSVKWHV96

Wednesday, December 16, 2009

Economy of China and US, a comparison


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People's Republic of china has the third largest economy in the world after US and Japan. Japan has ever going economy we all know, the main comparison is between China and United States.

China has ever growing economy since its independence and it reaches there in almost in 60 years. US is super power in the world and have the largest economy in the world but since the last ten years china is improving its economy and the US is doing war against terrorism.

It is the main difference between china and US and China says that it will do nothing except improving economy until 2010.

China is very much committed on it and United States should take care of it....