The Global Financial Crisis- 3

By Kanica Soni

India has strong basic fundamentals due to which India is still buffered from the financial crisis however, policy makers need to be very cautious when making the policies in order for the country to be able to remain buoyant during this time. This is positive view is seen in a below statement by a senior official of the IMF:

“India is likely to emerge unscathed from the financial crisis sweeping the globe, thanks to the structure of its economy, exports and financial markets.”

CAUSES OF THE FINANCIAL CRISIS for India and other nations

Concerned about the global repercussions of the financial crisis, on 30 October 2008, General Assembly President, Mr. Miguel d’Escoto ( Nicaragua ), invited a panel of experts to hold an interactive discussion with Member States on causes; below are important views on the same pointing to the causes of current financial crisis.

Professor Francois Houtart ; The G-77/China indicated that the crisis is unprecedented because the epicenter is the richest and strongest country in financial terms and this evidences the weakness of the current international financial architecture to prevent crises of these sorts. The Group highlighted the loss of public confidence not only in governments but also in institutions and noted that the crisis cannot be dealt with effectively within the current institutional framework– there is a gap that needs to be filled through comprehensive review and reform of a systemic nature.

Professor Prabaht Patnaik, Professor at the Centre for Economic Studies and Planning at India said that the cause of the problem was located in the fundamental defect of the free market system regarding its capacity to distinguish between “enterprise” and “speculation” and hence, in its tendency to become dominated by speculators, interested not in the long-term yield assets but only in the short-term appreciation in asset values.

Besides the above facts, it is important to look at other factors that fuel this crisis that I have listed down below:

1. The current institutional composition of the markets, the deregulated nature of those markets and the vast liquid assets in private hands have even placed limits on concerned action by national governments and this does not allow to anticipate stabilization.

2. The concept of globalization refers to the universalization of a certain model of market society, characterized as open and private, because of its hypothetic character (model) confers such condition to the same globalization.

So, although the fact that several countries have realized reforms to push liberalization, as well as opening and economic privatizations can be attested, we are not in the face of a society of open and private world market, where, for example, there is free movement of work, or where federal or state governments do not participate in the property of very different assets.

3. Even then fundamental problem is found in the swings of overconfidence that was seen in many countries since the 1990s, overconfidence shared by millions, billions, of people. And this confidence has been very strong until recently.

4. Speculation (in a financial context) is the assumption of the risk of loss, in return for the uncertain possibility of a reward. Where the respective speculators take a carelessly calculated risk.

FACTORS THAT KEEP INDIA BUFFERED FROM THE IMPACT OF THE CRISIS AND POINT TOWARDS STABILITY

1. Domestic demand in India is very very strong, where you still have investments that is growing very strongly.

2. Consumption, especially of durables, has come off a little bit as interest rate has increased from last year and are beginning to bite, Kochar said in a teleconference.

3. Investments, which overtook consumption as the key driver of economic growth in 2003-04, has increased 20 per cent from last year’s level.

4. At the India Economic Summit in New Delhi this week, Indian officials and corporate executives remained optimistic about the future of outsourcing.

5. Montek Ahluwalia, Deputy Chairman of India's Planning Commission, predicted that India's economic growth for 2008-2009 will be between seven and nine percent. press release.

 

WHAT FACTORS CAN PROVE TO BE DANGEROUS

 

India is plugged into the world trading system but Indian exports have been diversified both in terms of goods and markets... On service exports... we don’t have a whole lot of strong evidence but we do believe that impact could go either way, Kochar noted.

To prevent such financial disasters in future Professor Francois Houtart, Professor Emeritus at Belgium ’s Catholic University of Louvain and founder of the Tricontinental Centre - noted the need for the transparency of financial instruments and institutions and stressed that managing them in a coordinated way at the national, regional and international level was crucial.

REF: http://www.globalresearch.ca/index.php?context=va&aid=10792

Copyright © Kanica Soni 2008 owned by Kanica Soni . All Right Reserved

 

The Global Financial Crisis- 2

By Kanica Soni

India so far has put up a brave front to the global financial crisis that has hit our economy, where from the dawn of the technological advancements and globalization was pouring in new investments that fuelled a large economy to boost ahead, it is these very factors that have infact, as it seems metaphorically crippled us.

Looking at the global financial crisis from the perspective of a developing economy, it is hard to ignore the factors that has caused, the break-down of one large economy on many upcoming and growing ones.
In my last article(THE GLOBAL FINANCIAL CRISIS- UNDERSTANDING THE PRESENT AND LOOKING AHEAD) I spoke of how this happens, now I feel that it is important to dig deeper into why the recession has happened and we are unable to slow it down to turn the curve upward. one of the reasons as i explained in my last article is the fact that a problem at such a macro scale can not be resolved by measures taken by one country at a time. (like the issues arising due to the views of Angela Merkel, in the EU)

Besides this, it is important to look at the other factors that have caused this 'Boom' to turn into a 'Boo' so we can learn from them and not make the same mistakes again.
In my perspective it all started from the a simple human characteristic, that is infact causing alot other problems as well i.e. Greed!!

It is the urge to want more/ earn more on an essential commodity that people would pay for as it is a subsistence resource for a large part of many economies, as the Oil prices were increased, the world saw a drastic increase in the food prices (that use oil consuming machines for production and refinement) that in turn caused the food crisis early this year. Thus emerged the Food and Fuel Crisis.

In 2008, oil prices surpassed $100 a barrel for the first time, the first of many price milestones to be passed in the course of the year. In July, oil peaked at $147.30 a barrel.
Subsequently, the prices of many commodities, notably oil and food, got so high to cause genuine economic damage, threatening stagflation and a reversal of globalization, as first Egypt then Brazil (major exporters) curbed both production and stopped exports.

As prices soared, the crisis led to cash deficit (the credit available), and it is from this liquidity that investment banks multiplied the value of their capital, and therefore the investment banks began to suffer.
Gradually, as we see after investment banks, the automobile industry and luxury goods industry is suffering. The way is going to be long and hard but the world economies need to reverse the effects of large scale globalization to promote a sense of security in the consumers and the producers, simultaineously look at how to create jobs and continue to upkeep the cycle of

Income --- Expenditure --- Consumption--- 1. Investment 

                                                                                                                           --- 2. Production 

                                                              3. Consumption again --------- 


Copyright © Kanica Soni 2008 owned by Kanica Soni . All Right Reserved

Forensic Science- Introduction & An insight Into Forensic Psychology

By Kanica Soni

WHAT IS FORENSIC SCIENCE 

Forensic science is the application of a broad spectrum of sciences to answer questions of interest to the legal system in essence to produce evidence in controversial cases, this may be in relation to a crime or to a civil action. But besides its relevance to the underlying legal system, more generally forensics encompasses the accepted scholarly or scientific methodology and norms under which the facts regarding an event, or an artifact, or some other physical item (such as a corpse, or cadaver, for example) are to the broader notion of authentication whereby an interest outside of a legal form exists in determining whether an object is in fact what it purports to be, or is alleged as being.



The word “forensic” comes from the Latin adjective “forensis” meaning of or before the forum. During the time of the Romans, a criminal charge meant presenting the case before a group of public individuals in the forum. Both the person accused of the crime and the accuser would give speeches based on their side of the story. The individual with the best argument and delivery would determine the outcome of the case. Basically, the person with the sharpest forensic skills would win. This origin is the source of the two modern usages of the word "forensic" - as a form of legal evidence and as a category of public presentation.
The major branch yet a generalized on is that of criminalistics it is the application of various sciences to answer questions relating to examination and comparison of biological evidence, trace evidence, impression evidence (such as fingerprints, footwear impressions, and tire tracks), controlled substances, ballistics, firearm and tool mark examination, and other evidence in criminal investigations. Typically, evidence is processed in a crime lab. Besides this there are more specialized fields under forensics like that of Entymology, Anthropology, Archeology, and others.
A very important factor in Forensics is that of the legal system of the respective companies. 

(Ref: Wikipedia)

THE UPCOMING FIELD OF FORENSIC PSYCHOLOGY AND ITS EFFECTIVENESS
Behind the Closed Doors of a Mind...



"Forensic Psychology - To not only know how "madmen" think but to step into their world, if only to bring it to a halt. "

The art of forensics also is in trying to know the core cause of crimes, and why they are at a higher rate in some places and why they are lower in other, a key in that is to find the cause of it in the first place. 

Looking at developing countries, people either steal because they are kleptomaniac for those who are well off, on the other hand, there are those who need the money for subsistence; the case is a little difference in the developed nations that even tend to provide for subsistence requirements for the unemployed; there the reason for the high rates of crime then become a part of the arena of forensic psychology. Although the evidence that this field of study provides is controversial and not admissible in some courts of law, it does in certain cases aids the investigation with certain types of information that tells the investigating officers the kind of person they are looking for. Infact, such profiling has often aided in getting a criminal behind bars, and after that gathering the evidence to prove the crimes is relatively simpler.

Hence as the world moves on the use of such abstract new fields of study often come to the aid of sciences such as this that help understanding the minds of those who are beyond stealing or killing for a logical purpose like self defense. The below phrase aptly describes how factors like raging hormones or an undiagnosed psychological disorder proceeds to manifest itself in the mind of an individual as it thrives:



"It was an urge. ... A strong urge, and the longer I let it go the stronger it got, to where I was taking risks to go out and kill people risks that normally, according to my little rules of operation, I wouldn't take because they could lead to arrest." —Edmund Kemper. 

Many a time if the cause of a series of murders committed may not be merely psychological, the reason may be the way a person deals with stress. 

The method of profiling as such may very well be debatable considering the fact that there is no particular method that is/ has been established universally. In studying various trends a psychologist can by studying past history and a variety of cases find the common causes to murders. In doing so presenting a motive to a court of law becomes easier to find, when they too are opening up to the possibilities of an innate psychological tendency that could be the cause of a person to act violently, other than the usual cause that was accepted i.e. a motive to act in that way like that of money or revenge.



In the present world I think the value of such evaluations and profiling done be forensic psychologists is becoming more and more essential especially with the rise of terrorism. Profiling a terrorist and finding a cause to the violence is essential in trying to eliminate it. Likewise this theory is applicable not only to terrorists, it is also applicable in mass murderers, further more an offshoot of the application of this theory is that in the case of serial murderers a prediction can be made as to when and how a criminal may strike for his/her next offence. This is a key that can save lives and help capture dangerous men/women that pose a threat to society.

Copyright © Kanica Soni 2008 owned by Kanica Soni . All Right Reserved

Mumbai Attacks

By Prashant Guha

In the changing scenario as our country progresses towards the new dawn of 61st year of its independence, another shameful episode leaves the nation in shambles. The Mumbai mishap on 26th – 27th Nov 2008 shows how strong our civil administration is. This episode has been a bare slap on the nation’s security. Militancy in parts like J & K and eastern sector is still desirable as we share our boundaries with our allies but our business capital?

Yet again, this raises the questions like - Are we really safe in our own country? Is our nation so weak that a band of some anti-social elements trying to assert the terror (that they have adopted as a religion,) walk into our territory, unquestioned and create so much of havoc and all that our government authorities can do is wait and watch? Is this our NATIONAL SECURITY?

The Real Picture – A ship called VM ULFA came from Karachi and harbored at the Mumbai civil dock for a week and was expected to carry militants across the border. It is also known that the weapons and machinery were transported from the ship to the desired locations and then to Hotel Taj and The Oberoi. An obviously controversial yet logical conclusion can be derived- that this sort of planned incursion has had to have people within our administration involved, as there was apparent knowledge about the holes in security and such weapons of mass destruction cannot reach a place (like the hotels mentioned above) without security checks. 

This shows how loyal the civil administration is to our National Security. Who is to be blamed for this? The government or the administration? The common man is exposed to the hands of people who he has nothing to do with. The police fails as they are not well equipped and they lack the required skills. And again, the reserved forces who are part of the so called Home Ministry, which thoroughly responsible for the internal security of the country fail.

Why do they exist? What is the aim of having a mass of unskilled people who are paid to do this work and are still so inefficient...

Eventually, like always the government banks upon the Para Military Forces- The Indian Army and Naval Commandos have been called to fight this series of terror. Is this what are they paid for - to fend internal terror attacks or to guard the nation from external issues that violate the security of the nation. The role reversal shows that how strong the Armed Forces are, and that they don't just handle their job but also that of civil administration. The crux of the matter is that we need to ask ourselves and analyze the world are we living in.
Are we safe in our own houses? With what feelings do we trust our Civil Administration? Its better we have Military rule in our country also. At least we will be safe. Some time back some one argued saying that India can never sustain Military rule and if such incidents take place its fine as it does happen but I’d like to raise a question to you all -- “If everyday 100 people start dying devastating and terrifying deaths like this then when would you prefer to die? The first day or the thirtieth day or the Three Hundred Sixty Fifth Day?” 

edited by Kanica Soni 

Carbon offsets

A product of the Kyoto protocol were the Carbon Offsets, they are a type of carbon currency, a medium of exchange by which one activity that reduces emissions at a higher cost can be swapped for another that does so at a lower cost. 

However, their benefit seems to be limited and restricted especially looking at Global Trade, the manufacturing units in the world and the ever increasing consumerism that causes this carbon currency to be watered by counterfeit credits that are very difficult in practice to distinguish from the genuine article. 

This causes problems to emerge around fraudulent currency of this kind that seeps from increasing uncertainty about the value of other carbon currencies that in essence makes vulnerable the very value of carbon offsets, its meaning and defies the intent with which it was created.

Now more than ever the Carbon Credits are losing their power as major economies of the world are sliding into recession and the environment is beginning to take a back seat, and survival has become the core focus.
None the less such a policy does hold its place in that it works as an incentive to the reduction of our carbon foot prints and in the long run it will benefit our world. 



However, a lot of countries being hit by the Financial crisis are going back on their words and delaying the up-gradation of their respective industries/machiney as, it not only costs money but also cuts on employment which right now is crucial to maintain. 

A major example of which is Germany which uses brown coal, the most polluting form of coal, which still relies on it for one-fifth of its energy supply. The argument revolves around it being their important resource to why turn to expensive sources that is especially applicable in this time.

Many say that the promises that the Green world promises are unrealistic and consistent with the economic fundamentals of todays economic forms. On the other hand there are silver lines in China, Korea and other such countries that are adapting what the Green Policies have to offer to their needs and requirements. 

But in a world heading for a financial slowdown policy-makers must keep their focus on the envioronment which will be of greater importance in the long run and the survival of our species, (that very intelligently seems to be destroying the world they live in), furthermore this can not and should not take a back seat and therefore despite the gloomy financial atmosphere we must fight to keep our priorities in place.