RESERVE CURRENCY

Reserve currencyFrom Wikipedia, the free encyclopediaJump to: navigation, searchThe US dollar and the euro are by far the most used currencies in terms of global reserves, making up 90% of all reserves globally. The US dollar and the euro are by far the most used currencies in terms of global reserves, making up 90% of all reserves globally.The US dollar and the euro are by far the most used currencies in terms of global reserves, making up 90% of all reserves globally.A reserve currency (or anchor currency) is a currency which is held in significant quantities by many governments and institutions as part of their foreign exchange reserves. It also tends to be the international pricing currency for products traded on a global market, such as oil, gold, etc.This permits the issuing country to purchase the commodities at a marginally cheaper rate than other nations, which must exchange their currency with each purchase and pay a transaction cost. (For major currencies, this transaction cost is negligible with respect to the price of the commodity.) It also permits the government issuing the currency to borrow money at a better rate, as there will always be a larger market for that currency than others.Contents[hide]* 1 Global currency reserves * 2 History * 3 Theory * 4 United States dollar * 5 Euro * 6 Pound sterling * 7 Other notable reserve currencies * 8 See also * 9 References[edit] Global currency reservesCurrency composition of official foreign exchange reserves ↓ '95 ↓ '96 ↓ '97 ↓ '98 ↓ '99 ↓ '00 ↓ '01 ↓ '02 ↓ '03 ↓ '04 ↓ '05 ↓ '06 ↓ '07 ↓US dollar 59.0% 62.1% 65.2% 69.3% 70.9% 70.5% 70.7% 66.5% 65.8% 65.9% 66.4% 65.7% 63.3%Euro 17.9% 18.8% 19.8% 24.2% 25.3% 24.9% 24.3% 25.2% 26.5%German mark 15.8% 14.7% 14.5% 13.8% Pound sterling 2.1% 2.7% 2.6% 2.7% 2.9% 2.8% 2.7% 2.9% 2.6% 3.3% 3.6% 4.2% 4.7%Japanese yen 6.8% 6.7% 5.8% 6.2% 6.4% 6.3% 5.2% 4.5% 4.1% 3.9% 3.7% 3.2% 2.9%French franc 2.4% 1.8% 1.4% 1.6% Swiss franc 0.3% 0.2% 0.4% 0.3% 0.2% 0.3% 0.3% 0.4% 0.2% 0.2% 0.1% 0.2% 0.2%Other 13.6% 11.7% 10.2% 6.1% 1.6% 1.4% 1.2% 1.4% 1.9% 1.8% 1.9% 1.5% 1.8% Sources: 1995-1999, 2006-2007 IMF: Currency Composition of Official Foreign Exchange ReservesPDF (80 KB)Sources: 1999-2005, ECB: The Accumulation of Foreign ReservesPDF (816 KB) v • d • e Percentage of global currenciesPercentage of global currencies[edit] HistoryBy some definitions reserve currencies have existed for millennia. These currencies were widely recognized and used for international transactions. However, the modern conception of an international currency as a store of value for the international reserves of central banks and governments is a relatively recent development, arising only in the 19th century coinciding with the emergence of the international gold standard in the decades leading up to the First World War.After World War II, the international financial system was governed by a formal agreement, the Bretton Woods System. Under this system the US dollar was placed deliberately at the centre of the system, with the US government guaranteeing other central banks that they could sell their US dollar reserves at a fixed rate for gold if they so desired. European countries and Japan deliberately devalued their currencies against the dollar in order to boost exports and development.In the late 1960s and early 70s the system came apart under pressure from the rising prominence of the other countries, as well as growing deficits in the US. The US dollar remained central due to the lack of competitor currencies.Recently, nations, especially in Asia, have been stockpiling reserves at levels previously unknown, especially in US dollars, in an effort to strengthen export competitiveness by weakening their own currencies, and also to contain quick and large inflows of capital and buffer against financial crisis such as the Asian financial crisis.[edit] TheoryEconomists debate whether or not a single reserve currency will always dominate the global economy.[1] Many have recently argued that one currency will almost always dominate due to network externalities, especially in the field of invoicing trade and denominating foreign debt securities, meaning that there are strong incentives to conform to the choice that dominates the marketplace. The argument is that, in the absence of sufficiently large shocks, a currency that dominates the marketplace will not lose much ground to challengers.However, some economists, such as Barry Eichengreen argue that this is not as true when it comes to the denomination of official reserves because the network externalities are not strong. As long as the currency's market is sufficiently liquid, the benefits of reserve diversification are strong, as it ensures against large capital losses. The implication is that the world may well soon begin to move away from a financial system dominated uniquely by the dollar. In the first half of the 20th century multiple currencies did share the status as primary reserve currencies. Although Sterling was the largest currency, both francs and marks shared large portions of the market until the First World War, after which the mark was replaced by dollars. Since the Second World War, the dollar has dominated official reserves, but this is likely a reflection of the unusual domination of the American economy during this period, as well as official discouragement of reserve status from the potential rivals, Germany and Japan.[edit] United States dollar This section does not cite any references or sources.Please help improve this section by adding citations to reliable sources. Unverifiable material may be challenged and removed. (December 2007)The United States dollar is the most important reserve currency in the world today. Throughout the last decade, an average of two thirds of the total allocated foreign exchange reserves of countries have been in U.S. dollars. For this reason, the U.S. dollar is said to have "reserve-currency status", making it somewhat easier for the United States to run higher trade deficits with greatly postponed economic impact (see currency crisis). Central bank reserves held in dollar-denominated debt, however, are relatively small compared to private holdings of such debt. If foreign holders of dollar-denominated assets decided to shift holdings to assets denominated in other currencies, there could be serious consequences for the U.S. economy. Changes in the structure of the international financial system, however, typically occur only gradually. Thus, a large, sudden shift away from dollar reserve holdings is unlikely.[edit] EuroThe euro is currently the second most commonly held reserve currency, being approximately a quarter of allocated holdings. After World War II and the rebuilding of the German economy (see the Wirtschaftswunder), the German Deutsche Mark gained the status of the second most important reserve currency after the US dollar. When the euro was launched in 1999, replacing the Mark and other European currencies, it inherited the status of a major reserve currency from the Mark. Since then its contribution to official reserves has risen continually as banks seek to diversify their reserves and trade in the eurozone continues to expand.[2] The New York Times Book Review also referred to the euro as the "Deutsch-Mark by another name".Former Federal Reserve Chairman Alan Greenspan said in September 2007 that the euro could replace the U.S. dollar as the world's primary reserve currency. It is "absolutely conceivable that the euro will replace the dollar as reserve currency, or will be traded as an equally important reserve currency."[3] Econometrical analysis suggests, the euro may replace the U.S. dollar as the major reserve currency by 2020 if: (1) the remaining EU members, including the UK, adopt the Euro by 2020 or (2) the recent depreciation trend of the dollar persists into the future.[4][edit] Pound sterlingThe United Kingdom's pound sterling was the primary reserve currency of much of the world in the 18th and 19th centuries. The dire economic cost of fighting the First and Second World Wars, the increasing dominance of the USA in world economics (and, importantly, the establishment of the American Federal Reserve Bank in 1913) as well as economic weakness in the UK at various intervals during the second half of the 20th century resulted in Sterling losing its status as the world's most reserved currency.As from mid 2006 it is the third most widely held reserve currency, having seen a resurgence in popularity in recent years.[5] Analysts say this resurgence is caused by carry-trade investors considering the pound as a stable high-yield proxy to the Euro.[6][edit] Other notable reserve currenciesThe Japanese yen was considered as the third most important reserve currency for several decades, but has recently been on the decline and has now been overtaken by sterling.The Soviet ruble was also an important reserve currency along with the U.S. Dollar, in the Communist world, from about the 1950's up until the Soviet collapse in 1991.The Swiss franc is often said to be a reserve currency as well, due to its stability, although the share of all foreign exchange reserves held in Swiss francs is typically just around or even below 0.3%.Other nations and groups of nations have expressed their desire to see their currencies (or future currencies) be used as reserve currencies, such as Russia, People's Republic of China, and the Gulf Cooperation Council.The G8 also frequently issues public statements as to exchange rates, though with the exception of Japan, the member states are impotent in their ability to directly affect rates.[clarify] In the past, however, its predecessor bodies could directly manipulate rates to reverse large trade deficits (see Plaza Accord).The top reserve currency is generally selected by the banking community for the strength and stability of the economy in which it is used. Thus, as a currency becomes less stable, or its economy becomes relatively less dominant, bankers may over time abandon it for a currency issued by a larger or more stable economy. This can take a relatively long time, as recognition is important in determining a reserve currency. For example, it took many years after the United States overtook the UK as the world's largest economy before the dollar overtook Sterling as the dominant global reserve currency

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BALANCE OF TRADE

Balance of tradeFrom Wikipedia, the free encyclopediaJump to: navigation, searchThe balance of trade encompasses the activity of exports and imports, like the work of this cargo ship going through the Panama Canal.The balance of trade encompasses the activity of exports and imports, like the work of this cargo ship going through the Panama Canal.The balance of trade (or net exports, sometimes symbolized as NX) is the difference between the monetary value of exports and imports in an economy over a certain period of time. A positive balance of trade is known as a trade surplus and consists of exporting more than is imported; a negative balance of trade is known as a trade deficit or, informally, a trade gap. The balance of trade is sometimes divided into a goods and a services balance; especially in the United Kingdom the terms visible and invisible balance are used.Contents[hide]* 1 Definition * 2 Economic impact o 2.1 Against trade deficit o 2.2 Pro-trade deficit * 3 Milton Friedman on trade deficits * 4 Physical balance of trade * 5 United States trade deficit * 6 See also * 7 Notes * 8 External links[edit] DefinitionThe balance of trade forms part of the current account, which also includes other transactions such as income from the international investment position as well as international aid. If the current account is in surplus, the country's net international asset position increases correspondingly. Equally, a deficit decreases the net international asset position.The trade balance is identical to the difference between a country's output and its domestic demand (the difference between what goods a country produces and how many goods it buys from abroad; this does not include money re-spent on foreign stocks, nor does it factor the concept of importing goods to produce for the domestic market).Measuring the balance of payments can be problematic because of problems with recording and collecting data. As an illustration of this problem, when official data for all the world's countries are added up, exports exceed imports by a few percent; it appears the world is running a positive balance of trade with itself. This cannot be true, because all transactions involve an equal credit or debit in the account of each nation. The discrepancy is widely believed to be explained by transactions intended to launder money or evade taxes, smuggling and other visibility problems. However, especially for developed countries, accuracy is likely.Factors that can affect the balance of trade figures include:* Prices of goods manufactured at home (influenced by the responsiveness of supply) * Exchange rates * Trade agreements or barriers * Other tax, tariff and trade measures * Business cycle at home or abroad.The balance of trade is likely to differ across the business cycle. In export led growth (such as oil and early industrial goods), the balance of trade will improve during an economic expansion. However, with domestic demand led growth (as in the United States and Australia) the trade balance will worsen at the same stage in the business cycle.Strong GDP growth economies such as the United States, the United Kingdom, Australia and Hong Kong run consistent trade deficits, as well as poorer countries also experiencing a lot of investment.Developed nations such as Canada, Japan, and Germany typically run trade surpluses. China also has a trade surplus. A higher savings rate generally corresponds with a trade surplus. Correspondingly, the United States with its negative savings rate consistently has high trade deficits.[edit] Economic impactModern economists are split on the economic impact of the trade deficit with opponents viewing it as a long run drag on GDP and employment with high social costs while proponents claim it is a sign of economic strength.[edit] Against trade deficitSome economists believe that GDP and employment[1][2] can be dragged down by an over-large deficit over the long run.[3][4]Those who ignore the effects of long run trade deficits may be confusing the David Ricardo's principle of comparative advantage with Adam Smith's principle of absolute advantage, specifically ignoring that latter. The economist Paul Craig Roberts notes that the comparative advantage principles developed by David Ricardo do not hold where the factors of production are internationally mobile.[5] [6] Free trade concepts presume free floating currencies; however, in the real world, currencies such as China's are not free floating, while others may be manipulated by governments.Since the stagflation of the 1970s, the U.S. economy has been characterized by slower GDP growth. In 1985, the U.S. began its growing trade deficit with China. Over the long run, nations with trade surpluses tend also to have a savings surplus while the U.S. has been plagued by persistently lower savings rates than its trading partners which tend to have trade surpluses with the U.S. Germany, France, Japan, and Canada have maintained higher savings rates than the U.S. over the long run. In 2006, the primary economic concerns have centered around: high national debt ($9 trillion), high non-bank corporate debt ($9 trillion), high mortgage debt ($9 trillion), high financial institution debt ($12 trillion), high unfunded Medicare liability ($30 trillion), high unfunded Social Security liability ($12 trillion), high external debt (amount owed to foreign lenders) and a serious deterioration in the United States net international investment position (NIIP) (-24% of GDP),[7] high trade deficits, and a rise in illegal immigration.[8][9] These issues have raised concerns among economists and unfunded liabilities were mentioned as a serious problem facing the United States in the President's 2006 State of the Union address.[citation needed][edit] Pro-trade deficitThose who defend deficits revert to explanations of comparative advantage. Buyers in the receiving country send the money back. A firm in America sends dollars for Brazilian sugarcane, and the Brazilian receivers use the money to buy stock in an American company. This may lead to profits leaving the U.S however as Americans may forfeit control. Although this is a form of capital account reinvestment, it may not be a liability on anyone in America.Such payments to foreigners have intergenerational effects: by shifting the consumption schedule over time, some generations may gain and others lose [10]. However, a trade deficit may incur consumption in the future if it is financed by profitable domestic investment, in excess of that paid on the net foreign debts. Similarly, an excess on the current account shifts consumption to future generations, unless it raises the value of the currency, detering foreign investment.However, trade inequalities are not natural given differences in productivity and consumption preferences. Trade deficits have often been associated with international competitiveness. Trade surpluses have been associated with policies that skew a country's activity towards externalities, resulting in lower standards. An example of an economy which has had a positive balance of payments was Japan in the 1990s.Milton Friedman and Dewly Tiwana argued that trade deficits are not important as high exports raise the value of the currency, reducing aforementioned exports, and visa versa for imports, thus naturally removing trade deficits not due to investment. This opinion is shared by David Friedman, who has said that they are 'fossil economics', based on ideas obsolete since David Ricardo.[11][edit] Milton Friedman on trade deficitsCurrent account balance 2006Current account balance 2006[12]Milton Friedman, the Nobel Prize-winning economist and father of Monetarism, argued that many of the fears of trade deficits are unfair criticisms in an attempt to push macroeconomic policies favorable to exporting[13] industries. He stated his belief that these deficits are not harmful to the country as the currency always comes back to the country of origin in some form or another (country A sells to country B, country B sells to country C who buys from country A, but the trade deficit only includes A and B). In fact, in his view, the "worst case scenario" of the currency never returning to the country of origin was actually the best possible outcome: the country actually purchased its goods by exchanging them for pieces of cheaply-made paper. As Friedman put it, this would be the same result as if the exporting country burned the dollars it earned, never returning it to market circulation.However, Friedman's argument may have been a short term argument that has not proven valid in the long run. It is equivalent to saying that it doesn't matter if you get indebted, because eventually you will have to pay the money back. The obvious counterargument is that once a significant debt has been accumulated, paying it back may be painful. Friedman's supporters retort that when the money returns, the demand for foreign currency will make the exchange rate better for trade deficit country. Additionally, Friedman opposed large-scale borrowing to fuel consumption. He argued that a balance of payments deficit was a symptom of this, and that if it was caused by incoming investment, it was not a bad thingThose who assert Friedman's view as if it were a long run view may be ignoring the intergenerational or long run consequences of deficits, low savings, and borrowing to fund consumption. If country A has a trade deficit because of large imports of consumer goods, other countries accumulate cash from country A. That money can be used to purchase existing investment assets and government bonds within country A. As a result, the return from those assets will accrue not to citizens of country A but to foreigners. The consumption standard of future generations in country A may therefore potentially decline as a result of the deficit. In particular, Americans are increasingly paying taxes to finance the interest on federal bonds held by foreigners. However, a criticism of this argument notes that all transactions are win-win. In the case of foreign investment in American assets, it helps fuel American economic growth and keeps US interest rates low. This argument is more appealing in the case of foreign direct investment, and less obvious when foreigners simply purchase the existing stock of assets.Friedman also believed that deficits would be corrected by free markets as floating currency rates rise or fall with time to encourage or discourage imports in favor of the exports, reversing again in favor of imports as the currency gains strength. A potential difficulty however is that currency markets in the real world are far from completely free, with government and central banks being major players, and this is unlikely to change within the foreseeable future. Nevertheless, recent developments have shown that the global economy is undergoing a fundamental shift. For many years the U.S. has borrowed and bought while in general, the rest of the world has lent and sold. However, as Friedman predicted, this paradigm appears to be changing.As of October 2007, the U.S. dollar has grown weaker against the euro, British pound, and many other currencies. For instance, the euro hit $1.42 in October 2007[14], the strongest it has been since its birth in 1999. Against this backdrop, American exporters are finding quite favorable overseas markets for their products and U.S. consumers are responding to their general housing slowdown by slowing their spending. Furthermore, China, the Middle East, central Europe and Africa are absorbing more of the world's imports which in the end may result in a world economy that is more evenly balanced. All of this could well add up to a major readjustment of the U.S. trade deficit, which as a percentage of GDP, began in 1991.[15]Friedman and other economists have also pointed out that a large trade deficit (importation of goods) signals that the country's currency is strong and desirable. To Friedman, a trade deficit simply meant that consumers had opportunity to purchase and enjoy more goods at lower prices; conversely, a trade surplus implied that a country was exporting goods its own citizens did not get to consume or enjoy, while paying high prices for the goods they actually received.Perhaps most significantly, Friedman contended strongly that the current structure of the balance of payments is misleading. In an interview with Charlie Rose, he stated that "on the books" the US is a net borrower of funds, using those funds to pay for goods and services. He pointed to the income receipts and payments showing that the US pays almost the same amount as it receives: thus, U.S. citizens are paying lower prices than foreigners for capital assets to exchange roughly the same amount of income. The reasons why the U.S. (and UK) appear to earn a higher rate of return on their foreign assets than they pay on their foreign liabilities are not clearly understood. An important contributing factor is that the U.S. has investment primarily in stocks abroad, while foreigners have invested heavily in debt instruments, such as U.S. government bonds [16]. [17] Other reports contend that U.S. net foreign income has deteriorated, and appears set to stay in deficit in the future [18].Friedman presented his analysis of the balance of trade in Free to Choose, widely considered his most significant popular work.[edit] Physical balance of tradeMonetary balance of trade is different from physical balance of trade (which is expressed in amount of raw materials). Developed countries usually import a lot of primary raw materials from developing countries at low prices. Often, these materials are then converted into finished products, and a significant amount of value is added. Although for instance the EU (as well as many other developed countries) has a balanced monetary balance of trade, its physical trade balance (especially with developing countries) is negative, meaning that in terms of materials a lot more is imported than exported.[edit] United States trade deficitThe United States has posted a trade deficit since the 1970s since the end of the so-called gold standard, and it has been rapidly increasing since 1997 [19] (see chart below). The US trade deficit hit a record high of 817.3 billion dollars in 2006, up from 767.5 billion dollars in 2005.[20]It is worth noting on the graph that the deficit slackened during recessions and grew during periods of expansion. Also of note, many economists calculate trade deficits and/or current account deficits as a percentage of GDP. The U.S. last had a trade surplus in 1991, a recession year. Every year there has been a major reduction in economic growth, it is followed by a reduction in the US trade deficit. [15]Warren Buffett has proposed a tool called Import Certificates as a solution to the United States' problem.

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INTERNATIONAL MOVERS

ShippingFrom Wikipedia, the free encyclopediaJump to: navigation, searchMerge arrow It has been suggested that this article or section be merged into Transport. (Discuss)image:title_transport.jpgThis article is partof the Transport seriesModes...Animal-poweredAviationCableHuman-poweredPipelineShipSpaceRailRoadSee also...Topics PortalThis box: view • talk • editThe Panama canal. A cargo ship transiting the Gatún locks northbound is guided carefully between lock chambers by "mules" on the lock walls to either side.The Panama canal. A cargo ship transiting the Gatún locks northbound is guided carefully between lock chambers by "mules" on the lock walls to either side.This article is about a basic concept of transport. For other uses, see Shipping (disambiguation).Shipping is physical process of transporting goods and cargo. Virtually every product ever made, bought, or sold has been affected by shipping. Despite the many variables in shipped products and locations, there are only three basic types of shipments: land, air, and sea.Land or "ground" shipping can be either by train or by truck. Trucking is easily the most popular form of shipping. Even in Air and Sea shipments, ground transportation is still required to take the product from its origin to the airport or seaport and then to its destination. Ground transportation is typically more affordable than air shipments, but more expensive than shipping by sea. Trucks are also much faster than ships and rail but slower than planes.Many trucks will take freight directly from the shipper to its destination in what is known as a door to door shipment. Vans and trucks of all sizes make deliveries to sea ports and air ports where freight is moved in bulk also.Harbor cranes unload cargo from a container ship at the Jawaharlal Nehru Port, Navi Mumbai, IndiaHarbor cranes unload cargo from a container ship at the Jawaharlal Nehru Port, Navi Mumbai, IndiaMuch shipping is done aboard actual ships. An individual nation's fleet and the people that crew it are referred to its "merchant navy" or "merchant marine". Merchant shipping is essential to the world economy, carrying the bulk of international trade. The ships are also extremely expensive constructions themselves, being some of the largest man-made vehicles ever. The term originates with the shipping trade of wind power ships, and has come to refer to the delivery of cargo and parcels of any size above the common mail of letters and postcards.Ground shipping can be cheaper and less restrictive to size, quantity, weight, and type of freight than by air transport. Air transport is usually reserved for products which must be sent within a shorter time frame. Some carriers offer ground shipping that operates on an exact timeline as air does. This is a recent development becoming mainstream among major carriers since the late 1990s. UPS and FedEx both offer guaranteed day ground shipping.Shipping can more generally refer to the transport of freight ("shipments"), independent of the mode of transport.[edit] Billing methods* Main article: IncotermThe most common trading terms used in shipping goods internationally are:* Freight on Board OR Free On Board (FOB): freight on board means that the exporter delivers the goods at the specified location. Example, FOB Kunming Airport (the exporter delivers the goods at Kunming airport). This means exporter is bound to deliver the goods at the Kunming Airport at his cost and expenses. In the case, the freight and other expenses for outbound traffic is borne by the importer.* Cost and Freight (C&F,CFR, CNF): (With insurance payable by the importer). The exporter pays the ocean shipping/air freight costs to the specified location. Example, C&F Los Angeles (the exporter pays the ocean shipping/air freight costs to Los Angeles). Many of the shipping carriers (such as UPS, DHL, FEDEX) offer guarantees on their delivery times. These are known as GSR guarantees or "guaranteed service refunds". This means that if the parcels are not delivered on time, the customer is entitled to a refund on the shipping cost. UPS, DHL and FEDEX make it difficult however for customers to determine which parcels are late and request their refunds, and thereby allow approximately 90% of potential refunds to go unclaimed. That amounts to over $1 billion USD per year in unclaimed refunds.* Cost, Insurance, and Freight (CIF): Insurance, and Freight are all paid by the exporter to the specified location. Example, CIF Los Angeles (the exporter pays the ocean shipping/air freight costs to Los Angeles including the insurance).

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ONLINE BANKING

Online banking (or Internet banking) allows customers to conduct financial transactions on a secure website operated by their retail or virtual bank, credit union or building society.Contents [hide]1 Features 2 History 3 Security 4 See also 5 References [edit] FeaturesOnline banking solutions have many features and capabilities in common, but traditionally also have some that are application specific.The common features fall broadly into several categories Transactional (e.g., performing a financial transaction such as an account to account transfer, paying a bill, wire transfer... and applications... apply for a loan, new account, etc.) Electronic bill presentment and payment - EBPP Funds transfer between a customer's own checking and savings accounts, or to another customer's account Investment purchase or sale Loan applications and transactions, such as repayments Non-transactional (e.g., online statements, check links, cobrowsing, chat) Bank statements Financial Institution Administration - features allowing the financial institution to manage the online experience of their end users ASP/Hosting Administration - features allowing the hosting company to administer the solution across financial institutions Features commonly unique to business banking include Support of multiple users having varying levels of authority Transaction approval process Wire transfer Features commonly unique to Internet banking include Personal financial management support, such as importing data into a personal finance program such as Quicken, Microsoft Money or TurboTax. Some online banking platforms support account aggregation to allow the customers to monitor all of their accounts in one place whether they are with their main bank or with other institutions...[edit] HistoryThe precursor for the modern home online banking services were the distance banking services over electronic media from the early '80s. The term online became popular in the late '80s and referred to the use of a terminal, keyboard and TV (or monitor) to access the banking system using a phone line. ‘Home banking’ can also refer to the use of a numeric keypad to send tones down a phone line with instructions to the bank. Online services started in New York in 1981 when four of the city’s major banks (Citibank, Chase Manhattan, Chemical and Manufacturers Hanover) offered home banking services[1] using the videotex system. Because of the commercial failure of videotex these banking services never became popular except in France where the use of videotex (Minitel) was subsidised by the telecom provider and the UK, where the Prestel system was used.The UK’s first home online banking services[2] was set up by the Nottingham Building Society (NBS) in 1983 ("History of the Nottingham". Retrieved on 2007-12-14.). The system used was based on the UK's Prestel system and used a computer, such as the BBC Micro, or keyboard (Tandata Td1400) connected to the telephone system and television set. The system (known as 'Homelink') allowed on-line viewing of statements, bank transfers and bill payments. In order to make bank transfers and bill payments, a written instruction giving details of the intended recipient had to be sent to the NBS who set the details up on the Homelink system. Typical recipients were gas, electricity and telephone companies and accounts with other banks. Details of payments to be made were input into the NBS system by the account holder via Prestel. A cheque was then sent by NBS to the payee and an advice giving details of the payment was sent to the account holder. BACS was later used to transfer the payment directly.Stanford Federal Credit Union was the first financial institution to offer online internet banking services to all of its members in Oct, 1994.[3][edit] Security Security token devicesProtection through single password authentication, as is the case in most secure Internet shopping sites, is not considered secure enough for personal online banking applications in some countries. Basically there exist two different security methods for online banking.The PIN/TAN system where the PIN represents a password, used for the login and TANs representing one-time passwords to authenticate transactions. TANs can be distributed in different ways, the most popular one is to send a list of TANs to the online banking user by postal letter. The most secure way of using TANs is to generate them by need using a security token. These token generated TANs depend on the time and a unique secret, stored in the security token (this is called two-factor authentication or 2FA). Usually online banking with PIN/TAN is done via a web browser using SSL secured connections, so that there is no additional encryption needed. Signature based online banking where all transactions are signed and encrypted digitally. The Keys for the signature generation and encryption can be stored on smartcards or any memory medium, depending on the concrete implementation. AttacksMost of the attacks on online banking used today are based on deceiving the user to steal login data and valid TANs. Two well known examples for those attacks are phishing and pharming. Cross-site scripting and keylogger/Trojan horses can also be used to steal login information.A method to attack signature based online banking methods is to manipulate the used software in a way, that correct transactions are shown on the screen and faked transactions are signed in the background.A recent FDIC Technology Incident Report, compiled from suspicious activity reports banks file quarterly, lists 536 cases of computer intrusion, with an average loss per incident of $30,000. That adds up to a nearly $16-million loss in the second quarter of 2007. Computer intrusions increased by 150 percent between the first quarter of 2007 and the second. In 80 percent of the cases, the source of the intrusion is unknown but it occurred during online banking, the report states.[4]CountermeasuresThere exist several countermeasures which try to avoid attacks. Digital certificates are used against phishing and pharming, the use of class-3 card readers is a measure to avoid manipulation of transactions by the software in signature based online banking variants. To protect their systems against Trojan horses, users should use virus scanners and be careful with downloaded software or e-mail attachments.In 2001 the FFIEC issued guidance for multifactor authentication (MFA) and then required to be in place by the end of 2006.

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COMMERCIAL BANK OF DUBAI

Bank ProfileIn 1969, when Commercial Bank of Dubai (CBD) started out as a Public Shareholding Company little did was know that sheer grit and determination would get us where they are today. An Emiri Decree issued by His Highness the Late Sheikh Rashid Bin Sayeed Al Maktoum, the founder of modern Dubai, laid the cornerstone of Commercial Bank of Dubai. They started out as a joint venture of Commerzbank, Chase Manhattan Bank and Commercial Bank of Kuwait. A minority stake was held by a few UAE businessmen.By 1982, little more than a decade later, CBD evolved into a National Public shareholding company. A feat complimented by an exponential increase in the capital base and mammoth restructuring of our operations. The feather in the cap came when the Government of Dubai became a key shareholder.Over the decades, CBD have transformed into a progressive and modern banking institution. It is supported by a sturdy financial base and reigned by a strong, stable management. The proof of which lies with there customers who have stood by us over the yearsIn 2007, Commercial Bank of Dubai reported a record net profit of 936 million and total assets totaling a whooping AED 30.4 billion. An achievement impossible if not for our ever increasing and forever loyal customer base.Today, they are in a position to offer you a range of retail and commercial banking products and services at par with any other bank in the industry. And a banking experience better than the best. With a network of 26 branches , we cover all of UAE. In the future, we aspire to take on the financial services industry head on so as to be able to meet your expectations of better interest rates, new services, easier access and better technology.[edit] Board of DirectorsH.E. Ahmed Humaid Al Tayer - Chairman H.E Saeed Ahmed Ghobash - Deputy Chairman H.E. Saeed Mohammed Al Ghandi - Deputy Chairman Mr. Khaled Abdul Wahed Al Rostamani - Director Mr. Abdul Rehman Saif Al Ghurair - Director Mr. Saeed Mohammed Al Mulla - Director Mr. Abdulla Saif Al; Habthoor- Director Mr. Omar Abdulla Al Futtaim - Director[edit] Financial Highlights (AED 000's)Years 2004 2005 2006 2007 Profit for the year 351,111 550,839 601,372 935,917 Total Assets 10,569,883 15,284,022 18,704,778 30,436,017 Loans & Advances 7,516,131 9,342,851 12,642,569 20,777,094 Customers' Deposits 7,477,864 10,635,789 13,755,671 21,176,937 Share-holders' Equity 2,070,931 2,821,338 3,810,092 4,758,898[edit] ServicesRetail BankingAt CBD it mean business. Banking business. No wonder, they bring you a wide array of door-to-door services that make banking a pleasurable and very easy experience. From accounts, deposits, loans to saving plans, we have a million schemes tailor-made for your unique needs.Retail Banking ProductsAccounts ~ Current Account ~ Savings Account Shahrazade Deposits ~ Fixed Deposit ~ Flexi Deposit Loans ~ Mortgage Loans ~ Personal Loans ~ Tam-Wheel (Car loan) ~ Tasaheel (Overdraft) Saving Schemes ~ Mustaqbali (Child savings plan) ~ Zawaj (Marriage savings plan) Cards ~ e-Tijari Web Card ~ Debit Card ~ Mustaqbali Card ~ Attijari Card ~ e-Dirham ~ Rateb card Corporate BankingIn pursuit of aim of becoming a leading financial institution in the UAE, CBD has achieved tremendous growth and increased its market share through various initiatives and priorities.CBD focus has always been centered on meeting the highest levels of customer expectation and matching best business practices, whilst building long-term relationships with there customers. CBD Corporate Banking has been our most successful core activity and strength and a major contributor to the achievement of there objectives.CBD is proud of its long-standing reputation as a customer-focused bank and has built a broad base of clients including large corporations, government entities, medium sized commercial customers and small businesses. This wealth of experience means that we understand how to make a complex financial world easy to navigate for our customers, in order for them to materialize most of opportunities in the rapidly growing market of UAE.CBD Corporate Banking caters for the different financial requirements of our broad range of customers, to help them meet their specific business requirements - so whether if you are a large corporate organization or a medium sized commercial establishment, they have the expertise available to meet your particular financial needs. A team of highly qualified Relationship Managers, backed up by a broad range of sophisticated financial solutions, strong operations support and advanced technology, enables us to understand your particular financial aspirations and focus on helping you to achieve them in the most efficient and cost-effective way.So whether you are looking for working capital, term loans, trade finance products, syndicated loans, capital markets issues, Islamic financing products, treasury products or cash management solutions, you can be sure that we have the tools and experience to help you achieve your goals. Corporate Banking ProductsCommercial Banking Transaction Banking Debt Capital Markets Financial Institutions Trade Services Treasury Credit Cards ~ Mastercard ~ Visa Gold Card ~ Visa Classic Card ~ Tijari Points Foreign Exchange Money Transfer Wealth ManagementOnline BankingIt's time to keep pace with the times. Be it the internet, the phone or the mobile, CBD offer banking that is a fingertip away. So that life goes on and we keep pace.- Phone Banking - SMS Banking - e-statement

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BANKING BUSINESS INTELLIGENCE

Banking business intelligence refers to all general functionalities business intelligence but is focused on the informational needs of banks and the finance community. With the increase of governmental regulations, information is the key component to compliance. Therefore, solutions are designed largely with a focus on the unique needs required by the financial industry, especially in relation to federally-mandated governance.In the United States, the banking industry is unique among other industries due to the amount of governmental regulation and oversight, yet at the same time banks must compete in the free market to gain customers, engage in marketing tactics and make a profit for its stockholders. It is also unique that most currency transactions do not occur from one person handing someone else cash money. Most currency transactions occur via electronic information exchange only without cash actually exchanging hands.What business intelligence is designed to do for banks is to allow the decision makers within the banking industry make the best decisions or take the best actions best upon the most accurate, complete and timely information.Contents [hide]1 History 2 Key Concepts 2.1 Information availability 2.2 Transactions by account 2.3 Loans 2.4 Portfolio Management 2.5 Hierarchy 2.6 Governmental regulations 2.7 Cash and Investment Management 2.8 FDIC and Peer Data 3 Trends 3.1 Growth of BI in banking 3.2 Immediate Event Streams 3.3 Risk Management 4 References [edit] HistoryAlthough there is no specific dates related to the introduction of the first business intelligence software geared only to the financial or banking industry, it appears that many software companies started introducing bank targeted products within the late 1990’s and early 2000’s. Until that time, many banks had to create their own bank end solutions, ETL (Extract, transform, load) Solutions and apply their unique business rules.As business intelligence companies started noticing an need unmet by other software, many started producing solutions specifically targeted towards this industry.[edit] Key Concepts[edit] Information availabilityIt has been reported that “50% of Businesses File Bankruptcy Due To a Data Loss." [1] This is because the cost of even one hour of downtime has been calculated in some studies as up to one million dollars. With the large amount of transactions, information systems must be fully available and usable in order to limit severe consequences. The consequences of lost or missing data is severe.This also means that Banking BI Solutions must include the back end capability and network availability to remain up and running, with failover capability and documented emergency procedures.[edit] Transactions by accountAccording to Plunkett research [2], there are currently over 6 billion dollars of deposits occur annually within the United States. This amount is truly amazing. Sandeep Junnarkar [3] reported that even medium sized banks have to deal with more than 90,000 daily wire transfers per day. Other transactions could deal with debits and credits towards corporate and personal accounts.Business Intelligence must be able to capture the relevant information related to each transaction, but then roll up each transaction in multiple hierarchies in order to determine what that transaction means to the health of the bank, the interest of the stockholder and the needs of the government. In addition, some transactions at one branch may have to be merged with transactions at another branch in order to get a full and complete picture of an account or a loan or a Portfolio (finance). Accurately applying business rules to every single transactions can be quite complex.[edit] LoansAs has been seen from the lending crises in early 2008, lending management practices within the bank can truly break the bank. These essentials of loan management can include the timing of loans and repayment schedules, portfolio diversification, duration of funding, the usage of credit rates and the time horizon for equity allocations [4]Business Intelligence for banking is designed to keep executives and bank managers up to speed on the nature of the outstanding loans, current loans under review and delinquent accounts. These solutions must provide the right information to the right people so that the right actions can be taken.[edit] Portfolio ManagementWith the Gramm-Leach-Bliley Act of 1999 ([FDIC Important Banking Legislation][1]), many banks have expanded their services to include insurance, investment services and portfolio management. This means that Business Intelligence must be able to handle the increasingly complex data requirements that are needed by the insurance and investment industries.[edit] HierarchyMergers continue to reduce the number of banks - from 9,000 in 2004 to 8,600 in 2007 [2]. What this does is to increase the complexity involved in the banking hierarchy. Some banks may own other banks and other banks may simply be holding companies. Within Business Intelligence, the software must be able to handle these types of complex hierarchies – not just parent/child but also peer to peer relationships between sister branches.[edit] Governmental regulationsWhen it comes to governmental regulation and the banking industry, the foundation of all compliance activities relates to information. Information must be protected from some groups or individuals, while being fully available to other groups or individuals.Some of the governmental regulations pertaining to banks include:Gramm-Leach-Bliley Act of 1999International Money Laundering Abatement and Financial Anti-Terrorism Act of 2001Sarbanes-Oxley Act of 2002Fair and Accurate Credit Transactions Act of 2003The Bank Secrecy ActUS Patriot ActBasel IIRight to Financial Privacy ActBusiness Intelligence Solutions are designed to help assist in the accurate and complete information exchange required to ensure compliance to all governmental regulations. In addition, the software solution must be flexible enough in order to adapt to new regulations and changes to existing laws.[edit] Cash and Investment ManagementBanks manage their cash levels and investment policies in order to remain liquid, become competitive and have enough money on hand to meet current and future needs. In addition, a poorly managed cash management policy could actually re-identify a bank as an investment company, which brings with it a completely new set of regulations that must be met.Software created for the banking industry must be able to handle reconciliations and settlements so that the management at the bank knows where their cash is today, where it’s going to be tomorrow, how much is supposed to be coming in and how much will be going out.[edit] FDIC and Peer DataThe most successful BI Solutions will also incorporate FDIC and peer data so that each bank can benchmark themselves against other banks or financial institutions. The FDIC will provide information relating to regional and national banking trends, industry impacting events, and alerts.[edit] Trends[edit] Growth of BI in bankingAccording to Lee Conrad “Business intelligence will become more important for community banks over the next few years, as bigger banks continue their push into the traditional realm of community banks, competing with them head-to-head.” [5]This means that software providers will continue to enhance their current BI solutions as well as providing new solutions to meet newer needs.[edit] Immediate Event StreamsLike the larger BI world, immediate event streams are the up and coming trend. These immediate event streams can include text messages, e-mails and other electronic alerts. The focus in banking business intelligence stems from data aggregated from multiple sources, predictive analytics, and peer or industry data [6][edit] Risk ManagementDataMonitor mentions that in banking business intelligence and largely due to the lending crises occurring in 2008, risk management is another huge trend [7]Some of this pressure will come from a need to please shareholders and more pressure may be granted by the US Federal Government. In fact, the report delivered by DataMonitor states:“Spend by retail banks in this area [sic] is expected to reach $1.76 billion by 2012. Risk assessment necessitates the integration of data stored in a variety of disparate data warehouses, as well as legacy applications, across various lines of business. As a result, a data integration, metadata management, and data store infrastructure will be vital to create this comprehensive view”

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Business

BusinessFrom Wikipedia, the free encyclopediaJump to: navigation, search This article needs additional citations for verification.Please help improve this article by adding reliable references. Unsourced material may be challenged and removed. (September 2008)For other uses, see Business (disambiguation) and The Business (disambiguation). Companies law Company · BusinessSole proprietorship Partnership(General · Limited · LLP) CorporationCooperative United States S corporation · C corporationLLC · LLLP · Series LLCDelaware corporationNevada corporationMassachusetts business trust UK / Ireland / Commonwealth Limited company(by shares · by guaranteePublic · Proprietary) Community interest company European Union / EEA SE · SCE · SPE · EEIG Elsewhere AB · AG · ANS · A/S · AS · GmbHK.K. · N.V. · OY · S.A. · more Doctrines Corporate governanceLimited liability · Ultra viresBusiness judgment ruleInternal affairs doctrine De facto corporation andcorporation by estoppel Piercing the corporate veilRochdale Principles Related areas Contract · Civil procedure v • d • e A business (also called firm or an enterprise) is a legally recognized organizational entity designed to provide goods and/or services to consumers. Businesses are predominant in capitalist economies, most being privately owned and formed to earn profit to increase the wealth of owners. The owners and operators of a business have as one of their main objectives the receipt or generation of a financial return in exchange for work and acceptance of risk. Notable exceptions include cooperative businesses and state-owned enterprises. Socialistic systems involve either government, public, or worker ownership of most sizable businesses.The etymology of "business" relates to the state of being busy either as an individual or society as a whole, doing commercially viable and profitable work. The term "business" has at least three usages, depending on the scope — the singular usage (above) to mean a particular company or corporation, the generalized usage to refer to a particular market sector, such as "the music business" and compound forms such as agribusiness, or the broadest meaning to include all activity by the community of suppliers of goods and services. However, the exact definition of business, like much else in the philosophy of business, is a matter of debate.Business Studies, the study of the management of individuals to maintain collective productivity in order to accomplish particular creative and productive goals (usually to generate profit), is taught as an academic subject in many schools.Contents [hide]1 Basic forms of ownership 2 Classifications 3 Organization 4 Management 5 Government regulation 5.1 Organizing a business 5.2 Commercial law 5.3 Capital 5.4 Intellectual property 5.5 Exit plans 6 See also 7 External links 8 Notes and references[edit] Basic forms of ownershipAlthough forms of business ownership vary by jurisdiction, there are several common forms:Sole proprietorship: A sole proprietorship is a business owned by one person. The owner may operate on his or her own or may employ others. The owner of the business has total and unlimited personal liability of the debts incurred by the business. Partnership: A partnership is a form of business in which two or more people operate for the common goal of making profit. Each partner has total and unlimited personal liability of the debts incurred by the partnership. There are three typical classifications of partnerships: general partnerships, limited partnerships, and limited liability partnerships. Corporation: A business corporation is a for-profit, limited liability entity that has a separate legal personality from its members. A corporation is owned by multiple shareholders and is overseen by a board of directors, which hires the business's managerial staff. Cooperative: Often referred to as a "co-op business" or "co-op", a cooperative is a for-profit, limited liability entity that differs from a corporation in that it has members, as opposed to shareholders, who share decision-making authority. Cooperatives are typically classified as either consumer cooperatives or worker cooperatives. Cooperatives are fundamental to the ideology of economic democracy. For a country-by-country listing of legally recognized business forms, see Types of business entity.

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Stock Exchange

Financial markets Bond marketFixed incomeCorporate bondGovernment bondMunicipal bondBond valuationHigh-yield debtStock marketStockPreferred stockCommon stockRegistered shareVoting shareStock exchangeForeign exchange marketDerivatives marketCredit derivativeHybrid securityOptionsFuturesForwardsSwapsOther MarketsCommodity marketMoney marketOTC marketReal estate marketSpot market-------------------------------------------------------------------------------- Finance seriesFinancial marketFinancial market participantsCorporate financePersonal financePublic financeBanks and BankingFinancial regulationv • d • e A stock exchange, share market or bourse is a corporation or mutual organization which provides "trading" facilities for stock brokers and traders, to trade stocks and other securities. Stock exchanges also provide facilities for the issue and redemption of securities as well as other financial instruments and capital events including the payment of income and dividends. The securities traded on a stock exchange include: shares issued by companies, unit trusts and other pooled investment products and bonds. To be able to trade a security on a certain stock exchange, it has to be listed there. Usually there is a central location at least for recordkeeping, but trade is less and less linked to such a physical place, as modern markets are electronic networks, which gives them advantages of speed and cost of transactions. Trade on an exchange is by members only. The initial offering of stocks and bonds to investors is by definition done in the primary market and subsequent trading is done in the secondary market. A stock exchange is often the most important component of a stock market. Supply and demand in stock markets is driven by various factors which, as in all free markets, affect the price of stocks (see stock valuation).There is usually no compulsion to issue stock via the stock exchange itself, nor must stock be subsequently traded on the exchange. Such trading is said to be off exchange or over-the-counter. This is the usual way that bonds are traded. Increasingly, stock exchanges are part of a global market for securities.[edit] History of stock exchangesIn 11th century France the courtiers de change were concerned with managing and regulating the debts of agricultural communities on behalf of the banks. As these men also traded in debts, they could be called the first brokers.Some stories suggest that the origins of the term "bourse" come from the Latin bursa meaning a bag because, in 13th century Bruges, the sign of a purse (or perhaps three purses), hung on the front of the house where merchants met.House Ter Beurze in BrugesHowever, it is more likely that in the late 13th century commodity traders in Bruges gathered inside the house of a man called Van der Burse, and in 1309 they institutionalized this until now informal meeting and became the "Bruges Bourse". The idea spread quickly around Flanders and neighbouring counties and "Bourses" soon opened in Ghent and Amsterdam.The house of the Beurze family on Vlamingstraat Bruges was the site of the worlds first stock Exchange, circa 1415. The term Bourse is believed to have derived from the family name Beurze.In the middle of the 13th century, Venetian bankers began to trade in government securities. In 1351, the Venetian Government outlawed spreading rumors intended to lower the price of government funds. There were people in Pisa, Verona, Genoa and Florence who also began trading in government securities during the 14th century. This was only possible because these were independent city states ruled by a council of influential citizens, not by a duke.The Dutch later started joint stock companies, which let shareholders invest in business ventures and get a share of their profits - or losses. In 1602, the Dutch East India Company issued the first shares on the Amsterdam Stock Exchange. It was the first company to issue stocks and bonds. In 1688, the trading of stocks began on a stock exchange in London.[edit] The role of stock exchangesStock exchanges have multiple roles in the economy, this may include the following:[1][edit] Raising capital for businessesThe Stock Exchange provides companies with the facility to raise capital for expansion through selling shares to the investing public.[2][edit] Mobilizing savings for investmentWhen people draw their savings and invest in shares, it leads to a more rational allocation of resources because funds, which could have been consumed, or kept in idle deposits with banks, are mobilized and redirected to promote business activity with benefits for several economic sectors such as agriculture, commerce and industry, resulting in a stronger economic growth and higher productivity levels and firms.[edit] Facilitating company growthCompanies view acquisitions as an opportunity to expand product lines, increase distribution channels, hedge against volatility, increase its market share, or acquire other necessary business assets. A takeover bid or a merger agreement through the stock market is one of the simplest and most common ways for a company to grow by acquisition or fusion.[edit] Redistribution of wealthStocks exchanges do not exist to redistribute wealth. However, both casual and professional stock investors, through dividends and stock price increases that may result in capital gains, will share in the wealth of profitable businesses.[edit] Corporate governanceBy having a wide and varied scope of owners, companies generally tend to improve on their management standards and efficiency in order to satisfy the demands of these shareholders and the more stringent rules for public corporations imposed by public stock exchanges and the government. Consequently, it is alleged that public companies (companies that are owned by shareholders who are members of the general public and trade shares on public exchanges) tend to have better management records than privately-held companies (those companies where shares are not publicly traded, often owned by the company founders and/or their families and heirs, or otherwise by a small group of investors). However, some well-documented cases are known where it is alleged that there has been considerable slippage in corporate governance on the part of some public companies (Pets.com (2000), Enron Corporation (2001), One.Tel (2001), Sunbeam (2001), Webvan (2001), Adelphia (2002), MCI WorldCom (2002), or Parmalat (2003), are among the most widely scrutinized by the media).[edit] Creating investment opportunities for small investorsAs opposed to other businesses that require huge capital outlay, investing in shares is open to both the large and small stock investors because a person buys the number of shares they can afford. Therefore the Stock Exchange provides the opportunity for small investors to own shares of the same companies as large investors.[edit] Government capital-raising for development projectsGovernments at various levels may decide to borrow money in order to finance infrastructure projects such as sewage and water treatment works or housing estates by selling another category of securities known as bonds. These bonds can be raised through the Stock Exchange whereby members of the public buy them, thus loaning money to the government. The issuance of such bonds can obviate the need to directly tax the citizens in order to finance development, although by securing such bonds with the full faith and credit of the government instead of with collateral, the result is that the government must tax the citizens or otherwise raise additional funds to make any regular coupon payments and refund the principal when the bonds mature.[edit] Barometer of the economyAt the stock exchange, share prices rise and fall depending, largely, on market forces. Share prices tend to rise or remain stable when companies and the economy in general show signs of stability and growth. An economic recession, depression, or financial crisis could eventually lead to a stock market crash. Therefore the movement of share prices and in general of the stock indexes can be an indicator of the general trend in the economy.[edit] Major stock exchangesTwenty Major Stock Exchanges In The World: Market Capitalization & Year-to-date Turnover at the end of October 2007Region Stock Exchange Market Value(trillions of US dollars) Total Share Turnover(trillions of US dollars) Africa JSE Securities Exchange $0.940 $0.349 Americas NASDAQ $4.39 $12.4 Americas São Paulo Stock Exchange $1.40 $0.476 Americas Toronto Stock Exchange $2.29 $1.36 Americas/Europe NYSE Euronext $20.7 $28.7 Asia-Pacific Australian Securities Exchange $1.453 $1.003 South Asia Bombay Stock Exchange $1.61 $0.263 Asia-Pacific Hong Kong Stock Exchange $2.97 $1.70 Asia-Pacific Korea Exchange $1.26 $1.66 South Asia National Stock Exchange of India $1.46 $0.564 Asia-Pacific Shanghai Stock Exchange $3.02 $3.56 Asia-Pacific Shenzhen Stock Exchange $0.741 $1.86 Asia-Pacific Tokyo Stock Exchange $4.63 $5.45 Europe Frankfurt Stock Exchange (Deutsche Börse) $2.12 $3.64 Europe London Stock Exchange $4.21 $9.14 Europe Madrid Stock Exchange (Bolsas y Mercados Españoles) $1.83 $2.49 Europe Milan Stock Exchange (Borsa Italiana) $1.13 $1.98 Europe Moscow Interbank Currency Exchange (MICEX) $0.9652 $0.4882 Europe Nordic Stock Exchange Group OMX1 $1.38 $1.60 Europe Swiss Exchange $1.33 $1.58Note 1: includes the Copenhagen, Helsinki, Iceland, Stockholm, Tallinn, Riga and Vilnius Stock ExchangesNote 2: latest data available is at the end of June 2007Note 3: latest data available is at the end of September 2007Sources: World Federation of Exchanges - Statistics/Monthly Remarks: There are 2 pending major mergers: NASDAQ with OMX; and London Stock Exchange with Milan Stock Exchange The London Stock Exchange in the City of London. New York Stock Exchange, New York City. The Bombay Stock Exchange in Mumbai.The main stock exchangesAmerican Stock Exchange Australian Securities Exchange Belgrade Stock Exchange Bermuda Stock Exchange Bolsa Mexicana de Valores Bolsa de Valores de Colombia Bolsa de Valores de Lima Bombay Stock Exchange Bucharest Stock Exchange Budapest Stock Exchange Cairo & Alexandria Stock Exchange Casablanca Stock Exchange Channel Islands Stock Exchange Euronext Amsterdam Euronext Brussels Euronext Lisbon Euronext Paris Frankfurt Stock Exchange Ghana Stock Exchange Helsinki Stock Exchange Hong Kong Stock Exchange Istanbul Stock Exchange Jakarta Stock Exchange JASDAQ JSE Securities Exchange Karachi Stock Exchange Korea Stock Exchange Kuwait Stock Exchange Lahore Stock Exchange London Stock Exchange Madrid Stock Exchange Malaysia Stock Exchange Milan Stock Exchange Nagoya Stock Exchange Nigeria Stock Exchange National Stock Exchange of India NASDAQ New York Stock Exchange Osaka Securities Exchange Philippine Stock Exchange Santiago Stock Exchange São Paulo Stock Exchange Shanghai Stock Exchange Shenzhen Stock Exchange Singapore Exchange Stockholm Stock Exchange Taiwan Stock Exchange Tehran Stock Exchange Tokyo Stock Exchange Toronto Stock Exchange Warsaw Stock Exchange Zurich Stock Exchange See also: Category:Stock exchanges[edit] Listing requirementsListing requirements are the set of conditions imposed by a given stock exchange upon companies that want to be listed on that exchange. Such conditions sometimes include minimum number of shares outstanding, minimum market capitalization, and minimum annual income.[edit] Requirements by stock exchangeCompanies have to meet the requirements of the exchange in order to have their stocks and shares listed and traded there, but requirements vary by stock exchange:London Stock Exchange: The main market of the London Stock Exchange has requirements for a minimum market capitalization (£700,000), three years of audited financial statements, minimum public float (25 per cent) and sufficient working capital for at least 12 months from the date of listing. NASDAQ Stock Exchange: To be listed on the NASDAQ a company must have issued at least 1.25 million shares of stock worth at least $70 million and must have earned more than $11 million over the last three years.[3] New York Stock Exchange: To be listed on the New York Stock Exchange (NYSE), for example, a company must have issued at least a million shares of stock worth $100 million and must have earned more than $10 million over the last three years.[4] Bombay Stock Exchange: Bombay Stock Exchange (BSE) has requirements for a minimum market capitalization of Rs.250 Million and minimum public float equivalent to Rs.100 Million.[5][edit] OwnershipStock exchanges originated as mutual organizations, owned by its member stock brokers. There has been a recent trend for stock exchanges to demutualize, where the members sell their shares in an initial public offering. In this way the mutual organization becomes a corporation, with shares that are listed on a stock exchange. Examples are Australian Securities Exchange (1998), Euronext (merged with New York Stock Exchange), NASDAQ (2002), the New York Stock Exchange (2005), Bolsas y Mercados Españoles, and the São Paulo Stock Exchange (2007).[edit] Other types of exchangesIn the 19th century, exchanges were opened to trade forward contracts on commodities. Exchange traded forward contracts are called futures contracts. These commodity exchanges later started offering future contracts on other products, such as interest rates and shares, as well as options contracts. They are now generally known as futures exchanges.[edit] The future of stock exchangesThe future of stock trading appears to be electronic, as competition is continually growing between the remaining traditional New York Stock Exchange specialist system against the relatively new, all Electronic Communications Networks, or ECNs. ECNs point to their speedy execution of large block trades, while specialist system proponents cite the role of specialists in maintaining orderly markets, especially under extraordinary conditions or for special types of orders.The ECNs contend that an array of special interests profit at the expense of investors in even the most mundane exchange-directed trades. Machine-based systems, they argue, are much more efficient, because they speed up the execution mechanism and eliminate the need to deal with an intermediary.Historically, the 'market' (which, as noted, encompasses the totality of stock trading on all exchanges) has been slow to respond to technological innovation. Conversion to all-electronic trading could erode/eliminate the trading profits of floor specialists and the NYSE's "upstairs traders."William Lupien, founder of the Instinet trading system and the OptiMark system, has been quoted as saying "I'd definitely say the ECNs are winning... Things happen awfully fast once you reach the tipping point. We're now at the tipping point."Congress mandated the establishment of a national market system of multiple exchanges in 1975. Since then, ECNs have been developing rapidly.[citation needed]One example of improved efficiency of ECNs is the prevention of front running, by which manual Wall Street traders use knowledge of a customer's incoming order to place their own orders so as to benefit from the perceived change to market direction that the introduction of a large order will cause. By executing large trades at lightning speed without manual intervention, ECNs make impossible this illegal practice, for which several NYSE floor brokers were investigated and severely fined in recent years.[citation needed] Under the specialist system, when the market sees a large trade in a name, other buyers are immediately able to look to see how big the trader is in the name, and make inferences about why s/he is selling or buying. All traders who are quick enough are able to use that information to anticipate price movements.ECNs have changed ordinary stock transaction processing (like brokerage services before them) into a commodity-type business. ECNs could regulate the fairness of initial public offerings (IPOs), oversee Hambrecht's OpenIPO process, or measure the effectiveness of securities research and use transaction fees to subsidize small- and mid-cap research efforts.Some[who?], however, believe the answer will be some combination of the best of technology and "upstairs trading" — in other words, a hybrid model.Trading 25,000 shares of General Electric stock (recent[when?] quote: $34.76; recent[when?] volume: 44,760,300) would be a relatively simple e-commerce transaction; trading 100 shares of Berkshire Hathaway Class A stock (recent quote: $139,700.00; recent volume: 850) may never be. The choice of system should be clear (but always that of the trader), based on the characteristics of the security to be traded.Even with ECNs forming an important part of a national market system, opportunities presumably remain to profit from the spread between the bid and offer price. That is especially true for investment managers that direct huge trading volume, and own a stake in an ECN or specialist firm. For example, in its individual stock-brokerage accounts, "Fidelity Investments runs 29% of its undesignated orders in NYSE-listed stocks, and 37% of its undesignated market orders through the Boston Stock Exchange, where an affiliate controls a specialist post."

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Electronic commerce

Electronic commerce , commonly known as e-commerce or eCommerce, consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks. The amount of trade conducted electronically has grown extraordinarily since the spread of the Internet. A wide variety of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as e-mail as well.A large percentage of electronic commerce is conducted entirely electronically for virtual items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is sometimes known as e-tail. Almost all big retailers have electronic commerce presence on the World Wide Web.Electronic commerce that is conducted between businesses is referred to as Business-to-business or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants (private electronic market).Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the exchange of data to facilitate the financing and payment aspects of the business transactions.Contents [hide]1 History 1.1 Early development 1.2 Timeline 2 Business applications 3 Government regulations 4 Forms 5 See also 6 Notes 7 References 8 External links[edit] History[edit] Early developmentThe meaning of electronic commerce has changed over the last 30 years. Originally, electronic commerce meant the facilitation of commercial transactions electronically, using technology such as Electronic Data Interchange (EDI) and Electronic Funds Transfer (EFT). These were both introduced in the late 1970s, allowing businesses to send commercial documents like purchase orders or invoices electronically. The growth and acceptance of credit cards, automated teller machines (ATM) and telephone banking in the 1980s were also forms of electronic commerce. From the 1990s onwards, electronic commerce would additionally include enterprise resource planning systems (ERP), data mining and data warehousing.Perhaps it is introduced from the Telephone Exchange Office, or maybe not.The earliest example of many-to-many electronic commerce in physical goods was the Boston Computer Exchange, a marketplace for used computers launched in 1982. The first online information marketplace, including online consulting, was likely the American Information Exchange, another pre-Internet online system introduced in 1991.Although the Internet became popular worldwide in 1994, it took about five years to introduce security protocols and DSL allowing continual connection to the Internet. And by the end of 2000, a lot of European and American business companies offered their services through the World Wide Web. Since then people began to associate a word "ecommerce" with the ability of purchasing various goods through the Internet using secure protocols and electronic payment services.[edit] Timeline1990: Tim Berners-Lee writes the first web browser, WorldWideWeb, using a NeXT computer. 1992: J.H. Snider and Terra Ziporyn publish Future Shop: How New Technologies Will Change the Way We Shop and What We Buy. St. Martin's Press. ISBN 0312063598. 1994: Netscape releases the Navigator browser in October under the code name Mozilla. Pizza Hut offers pizza ordering on its Web page. The first online bank opens. Attempts to offer flower delivery and magazine subscriptions online. Adult materials also becomes commercially available, as do cars and bikes. Netscape 1.0 is introduced in late 1994 SSL encryption that made transactions secure. 1995: Jeff Bezos launches Amazon.com and the first commercial-free 24 hour, internet-only radio stations, Radio HK and NetRadio start broadcasting. Dell and Cisco begin to aggressively use Internet for commercial transactions. eBay is founded by computer programmer Pierre Omidyar as AuctionWeb. 1998: Electronic postal stamps can be purchased and downloaded for printing from the Web. 1999: Business.com sold for US $7.5 million to eCompanies, which was purchased in 1997 for US $150,000. The peer-to-peer filesharing software Napster launches. 2000: The dot-com bust. 2002: eBay acquires PayPal for $1.5 billion [1]. Niche retail companies CSN Stores and NetShops are founded with the concept of selling products through several targeted domains, rather than a central portal. 2003: Amazon.com posts first yearly profit. 2007: Business.com acquired by R.H. Donnelley for $345 million[2]. 2008: US eCommerce and Online Retail sales projected to reach $204 billion, an increase of 17 percent over 2007[3].[edit] Business applicationsSome common applications related to electronic commerce are the following:E-mail and messaging Content Management Systems Documents, spreadsheets, database Accounting and finance systems Orders and shipment information Enterprise and client information reporting Domestic and international payment systems Newsgroup On-line Shopping Messaging Conferencing[edit] Government regulationsIn the United States, some electronic commerce activities are regulated by the Federal Trade Commission (FTC). These activities include the use of commercial e-mails, online advertising and consumer privacy. The CAN-SPAM Act of 2003 establishes national standards for direct marketing over e-mail. The Federal Trade Commission Act regulates all forms of advertising, including online advertising, and states that advertising must be truthful and non-deceptive.[4] Using its authority under Section 5 of the FTC Act, which prohibits unfair or deceptive practices, the FTC has brought a number of cases to enforce the promises in corporate privacy statements, including promises about the security of consumers’ personal information.[5] As result, any corporate privacy policy related to e-commerce activity may be subject to enforcement by the FTC.[edit] FormsContemporary electronic commerce involves everything from ordering "digital" content for immediate online consumption, to ordering conventional goods and services, to "meta" services to facilitate other types of electronic commerce.On the consumer level, electronic commerce is mostly conducted on the World Wide Web. An individual can go online to purchase anything from books, grocery to expensive items like real estate. Another example will be online banking like online bill payments, buying stocks, transferring funds from one account to another, and initiating wire payment to another country. All these activities can be done with a few keystrokes on the keyboard.On the institutional level, big corporations and financial institutions use the internet to exchange financial data to facilitate domestic and international business. Data integrity and security are very hot and pressing issues for electronic commerce these days

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