Entries Tagged 'Word of The Day' ↓

Word of The Day — Cultural Capital

Last week I noticed this term, “cultural capital,” in a magazine article about “The Handwritten Heritage of South Africa’s Kitabs”.

The subject of this article,”Kitabs,” refers to the Arabic word for “books“. The use of kitabs as a form of “cultural capital,” instantly attracted me.

I’ve spent a lifetime involved with some aspect of book-making; as a writer, paper-maker, poet, librarian, book-buyer, editor, book indexer, publishing consultant, an abstractor, a book and magazine reviewer, and a back-of the book index creator.

Today with the burning of Notre Dame leaving “a gaping hole in the heart of Paris,” it seems timely to try to define the term “cultural capital”. Continue reading →

Word of The Day: Ramping

Ramping—what it means for financial-crime prosecutions….

 

A number of financial sector frauds are now being reported in the news.

Notable is the arrest of the HSBC executive in charge of global forex cash trading, and an outstanding warrant for a former executive at that bank.

Forex is short for foreign exchange of currencies. This is the biggest of the global financial markets. Trading in the forex market averages 5.3 trillion dollars per day!

HSBC is a British bank, one of the largest investment banks in the world, headquartered in London. Prior to the Financial Crisis of 2008, HSBC was a leader in bank transfers.

This was back in the day when bank transfers weren’t as easy to do as now. HSBC acted as an intermediary, transferring a depositor’s money from one bank or credit union into its own bank and then on to another bank or credit union.

Forex is a similar operation. An intermediary bank accomplishes a transfer of one party’s currency into a different currency that is used by another country.

Usually forex transactions are a matter of exchanging smaller countries’ currency for the big five global currencies; the US dollar, EURO, Yen, British pound, or Swiss Franc.

For business transactions, forex facilitates trade between two or more parties operating in different country currencies.

International businesses; big investors called “money-market traders”; and tourists, all depend heavily on the forex market to “get to where they’re trying to go” financially or in person.

HSBC investigated the alleged fraud, a $3.5 billion purchase of sterling in 2011 for the Cairn Energy PLC, one of Europe’s leading independent oil and gas exploration and development companies, and found no breach of HSBC’s own code of conduct.

However, after the Financial Crisis of 2008 turned over a lot of financial rocks and slimy beings scurried out into the light, HSBC was alleged to have been involved in several kinds of shady dealings. Continue reading →

Word of The Day – Comparative Advantage

Comparative advantage – a win/win way to trade

Definition: Comparative advantage is gained when two parties each specialize in making a different kind of product and exchange them with the other party

Discussion:

When asked during the Town Hall debate about how they would bring back jobs to America, the candidates for President of the United States had two very different answers. The distinction between the two could be crucial for the next generation of American workers.

(1) Romney said he would “level the playing field“. This was in order to make American workers more competitive with workers in other countries. This attempt to increase equality of American and foreign workers apparently means many Americans would wind up being paid the same low wages as foreign workers. Moderator Candy Crawley questioned whether it would even be possible to accomplish this. Could Americans live on the pittances foreigners get paid? I wondered if this goal is the reason there is pressure to build a wall along our border with Mexico to keep Mexican day workers out of the US. Should we expect to see unemployed Americans soon be encouraged to take these jobs at the same low wage rates?

(2) Obama said that we would need to use education and training programs to raise the skill levels of American workers so they could be paid more than foreign workers. This is an economic model of domestic and foreign trade called “comparative advantage“. The solution gives workers in both countries (or regions of a country) a unique competitive advantage. We can trade high-end products made by skilled Americans to other countries. Other countries can trade cheap products made by unskilled foreign workers to us.

As an economic theory of trade, comparative advantage makes sense. In the real world, with many countries trading, it may not be so simple.