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Money matters: The Fed
Graham Macdonald
MBMG International Ltd.
We recently looked at the tenure of Alan Greenspan of
the office of Chairman of the Federal Reserve System, but what exactly
is the Fed and what does it do?
The Federal Reserve System is the central bank of the United States,
comprised of the Federal Reserve Board, the 12 Federal Reserve Banks,
and the national and state member banks. Its primary purpose is to
regulate the flow of money and credit in the country.
The Board of Governors is made up of 7 members that are appointed to
14-year terms, while appointments to the roles of chairman and vice
chairman are for four years, by the President and approved by the
Senate. The terms of Federal Reserve governors are as long as they are
(second only to lifetime appointments of federal judges) to insulate the
members from political pressures and foster independent decisions.
Almost all U.S. banks are a part of the Federal Reserve System, which
requires that those banks maintain a certain percentage of their assets
deposited with the regional Federal Reserve Bank. It was founded by
Congress in 1913 to provide the nation with a safer, more flexible,
stronger and more stable monetary, banking and financial system, or to
quote from the act that called it into being, “To provide for the
establishment of Federal reserve banks, to furnish an elastic currency,
to afford means of rediscounting commercial paper, to establish a more
effective supervision of banking in the United States, and for other
purposes.”
Over the years, its role in banking and the economy has expanded. Today,
the Federal Reserve’s duties fall into four general areas: conducting
the nation’s monetary policy by influencing the monetary and credit
conditions in the economy in pursuit of maximum employment, stable
prices, and moderate long-term interest rates supervising and regulating
banking institutions to ensure the safety and soundness of the nation’s
banking and financial system and to protect the credit rights of
consumers maintaining the stability of the financial system and
containing systemic risk that may arise in financial markets providing
financial services to depository institutions, the U.S. government, and
foreign official institutions, including playing a major role in
operating the nation’s payments system.
Before the establishment of the Federal Reserve System, banks maintained
the reserves required to be held against their deposits partly in the
form of cash in their vaults and partly in the form of deposits held
with other banks. In general, banks in smaller cities and rural regions
tended to maintain the bulk of their reserve balances with banks in
larger cities. A very large volume of these reserve balances was
maintained in New York City and Chicago. These two cities and St. Louis
were designated as central reserve cities, and National banks there had
to maintain all their legal reserves in the form of cash in their own
vaults.
When banks across the country needed to draw down their reserve
balances, this resulted in a concentration of this activity on the few
National banks situated in the financial centres. Ordinarily, the
situation was manageable - while some country banks would be drawing
down their balances, others would be building theirs up.
Occasionally, the demand became widespread and intense and banks all
over the country would call on the Chicago and New York banks for
currency, which the city banks were obliged to supply and charge to the
reserve balances of the country banks. Meeting this demand could be
difficult for the city banks because the currency constituted their own
reserves and there was no source on which they could rely for additional
reserve funds.
The efforts of these banks to protect their reserves frequently involved
the sale of securities and the refusal to make loans and renewals, with
the result that securities prices would fall, interest rates would rise,
borrowing would become difficult, and loans would have to be liquidated.
Panics and crises like this were apt to occur every few years, and in
1907 there was one of unusual severity. Congress appointed a National
Monetary Commission shortly thereafter for the purpose of determining
what should be done. There was active and thorough consideration of the
question for several years, and though Congress greatly modified the
plan recommended by the Commission, it eventually adopted legislation
embodying the results of the study both by the Commission and other
authorities inside and outside of Congress.
The resulting legislation created The Federal Reserve on December 23,
1913, with the signing of the Federal Reserve Act by President Woodrow
Wilson. The act had been drafted as House Resolution 7837 by
Representative Carter Glass (D-VA), incoming chairman of the House
Banking and Currency Committee.
Continued next week…
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The above data and research was compiled from sources believed to be
reliable. However, neither MBMG International Ltd nor its officers can accept
any liability for any errors or omissions in the above article nor bear any
responsibility for any losses achieved as a result of any actions taken or not
taken as a consequence of reading the above article. For more information please
contact Graham Macdonald on [email protected]
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Snap Shots: Forget the “A”, develop the “I”
by Harry Flashman
 With
today’s cameras, be they film or digital, it is very hard to get a
poorly exposed photograph. Set the auto-exposure on “A” and let the
camera do the rest. 99 times out of 100, the end result will be a print
that is perfectly exposed. However, that does not mean that you get 99
great shots out of every 100 exposures! Far from it. In fact, it may
surprise you to know that most pro photographers work on a 6 in 36
ratio. Six good shots in a roll of 36. Mind you, those are six
‘commercially viable’ shots!
For the non-commercial photographer, there is still an acceptable
standard to head towards. But if the magic “A” mode is so good, why do
you not get 99 good shots out of 100? The reason is that you have not
set the “I” mode. By the way, you can stop looking at the menu in your
camera, you won’t find the “I” mode. This mode is under your control,
not the camera’s electronics. It is your “eye” I am referring to when I
made up the “I” mode terminology.
What we are talking about here is photographic composition.
Understanding photographic composition is the key to getting great
photographs. What differentiates a “good” photo from a “bad” or
“ordinary” one is simply composition. Now the photographer’s “I” is
something that you may or may not be blessed with, but there are some
easy hints which will improve the composition and final effect of any of
your photographs.
The first rule of composition is to Look for a Different Viewpoint.
While the standard, Put the Subject in the Middle of the Viewfinder idea
will at least ensure that you do get a picture of the subject, it will
also ensure that your photograph will be dull and boring! If nothing
else, take two shots, one in the “usual” horizontal format and the
second one in a vertical (portrait) format.
In attempting to get that different viewpoint also try to take some
shots not from the standard eye-level position. Squat down, lie down,
stand in the back of a pick-up, climb a ladder – anything! Just don’t
get stuck with standard eye-level views.
The next way to add interest to your photographs is to make sure the
subject is one third in from either edge of the viewfinder. Just by
placing your subject off-centre immediately drags your shot out of the
“ordinary” basket. The technocrats call this the “Rule of Thirds”, but
you don’t need to know the name for it – just try putting the subjects
off-centre. While still on the Rule of Thirds, don’t have the horizon
slap bang in the centre of the picture either. Put it one third from the
top or one third from the bottom. As a rough rule of thumb, if the sky
is interesting put more of it in the picture, but if it is featureless
blue or grey include less of it. Simple!
Now what else can you do to improve those shots of yours? One good
little trick is to include some details in the foreground of a shot to
lead your eye towards the main subject. Look for lines, roads, telephone
wires, fences, etc., with strong lines to include in the shot. Arrange
the picture so that the lines “point” towards your main subject. A few
foreground details also help add interest to any photograph.
One foreground detail to always look for is the possibility of producing
a “frame” around the main subject. We call this the Frame within a Frame
technique. It is a very successful way to convert an ordinary shot into
one with a lot of visual appeal. And this is indeed a successful ploy.
You will find that many prize winning photographs use that technique.
Perhaps the last tip in making your shots more interesting is to include
people in them where possible. That shot of sweeping rolling hills
always looks better if you can put some human interest into it as well.
A girl on a horse, a couple on a seat or a jogger all help to elevate a
landscape above the hum-drum.
Modern Medicine: Hack, cough, splutter!
by Dr. Iain Corness, Consultant
There has been quite an epidemic of coughs and colds
recently, so if you haven’t got a cough consider yourself to be lucky. There
are many reasons for epidemics such as these, and many occur with the change
of seasons, hot to cold, cold to wet and so forth, but with the vast
majority, the common carrier of the bug is the human race.
Yes, we are the ones who go to work and spread our germs to the office,
exploding an aerosol of potentially debilitating diseases into the air,
every time we cough. This is the commonest way of transferring the bugs, by
what we call droplet infection. Every droplet capable of carrying thousands
of microbes, each one looking for another human to infect. You. Or even me.
The latest bout has been a form of Tracheitis. This is inflammation of the
trachea, that part of your breathing tube to the lungs before it splits to
become the right and left bronchus. The clue is in the ending – “itis” which
generally means inflammation and / or infection. Thus you can get
Appendicitis (inflammation of the Appendix) and Pharyngitis (inflammation of
the pharynx), Laryngitis (inflammation of the larynx), etc., you get the
picture.
Infection and irritation of the breathing tubes is, as we said in the
beginning, very common. The most usual cause is, however, our old friend
cigarette smoking! If you don’t believe that cigarette smoke is irritating,
try letting it waft into your eyes and see how they will sting and water.
Your Trachea and Bronchi do just the same! Once the irritation begins, the
mucosa becomes swollen, and it becomes easier for the germs to take hold.
With Tracheitis, it generally begins as a slight irritation deep in the back
of your throat. There can be some soreness as well, even on swallowing.
Unchecked this develops into a ‘productive’ cough, with loads of gunk being
coughed up, which we refer to as ‘sputum’.
One of the signs and symptoms your doctor will want to know is “What color
is your sputum?” This gives us a chance to see if your cough is from an
irritation or infection. If you are bringing up large lumps of yellow or
green glue then you have an infection, but if the mucous is clear then you
probably do not harbor a nasty little bug in your throat. If however, the
sputum is red and bloodstained then you may have burst a little blood vessel
in the throat – or of course, this could be an early sign of lung cancer,
but don’t panic yet!
If the sputum you are coughing up is thick, green and gooey, this is fairly
suspicious of a bacterial infection, and sometimes we will attempt to “grow”
the bug to identify it. No, this is not for germ warfare, it is just so that
we can feed the tracheal bug some different antibiotics to see which ones
exterminate the bug best. This is a much more accurate way of choosing the
correct antibiotic, than selecting ones by the pretty color they are on the
pharmacist’s shelves.
If you have gone over a week and your cough is showing no sign of letting up
then it really is time to line up with all the other coughers at the
outpatients department. Just make sure you can describe the color of your
sputum!
I should have mentioned that if you are a smoker, the chances of the cough
lasting longer are much higher, as well as being more likely to catch the
cough from someone else.
 Heart to Heart with Hillary
(Hillary is on holidays this week, so we have re-run one of
her previous columns)
Dear Hillary,
I keep on getting offensive emails from people I have never met and I find
it annoying to say the least. Is there nothing we ordinary people can do to
stop this kind of thing? 90 percent of them seem to be pornographic material
sites and yet when you go to the site to try and register a complaint,
nothing happens. What do you suggest, Hillary?
Confused
Dear Confused,
I’m confused, Petal! Are you really trying to go to the sites suggested to
complain or to check them out? I suppose you buy Penthouse magazine for the
words too. With the vast majority of unsolicited emails, spam, whether
pornographic or not, it is obvious from the subject line they are junk mail.
There is usually no need to open them before you trash them. Also most
servers have a ‘block sender’ facility where you can stop that particular
pest or porn purveyor from ever reaching your in box again. And stop going
there for a little peek.
Dear Hillary,
One of the girls in my regular bar was reading a letter from a farang and
asked me to translate a couple of sections for her. It was the usual
boyfriend to girlfriend letter and in it he said he was looking forward to
coming back next month. When I asked her who he was, she said she didn’t
remember! Hillary, why do these girls act like this? Surely they must
remember, or was she just stringing me along?
Jack.
Dear Jack,
She wasn’t playing with you – you’re playing with you! That is their job, or
didn’t you know. They are usually looking for marriage and future security
material, and obviously the fond pen pal hadn’t made as much of an
impression as he thought he had.
Dear Hillary,
Recently I find I have become very attracted to one of my workmate’s wife.
She is Thai and very beautiful and she has been making it obvious that she
would not be averse to something going on either. I know she has been seeing
other guys while her husband is offshore. My question is, should I pay her
for her time, or should it be more from the heart?
Roger
Dear Roger,
You bowl me over. Truly are you are thinking of betraying one of your
workmates and wondering about the acceptability of either offering to his
wife payment or love for services rendered? The choice is yours but either
way you may get more than you bargained for. I hope he’s 2.2 meters tall and
a Muay Thai champion. You deserve it, Roger the Lodger!
Dear Hillary,
My boyfriend is football mad. In fact, if there is a match on TV he will get
out of our bed, just to watch it. Am I being selfish to pretend to be asleep
when he gets back to bed? I feel I have to teach him a lesson.
No Footy Fan.
Dear No Footy Fan,
Not at all selfish, my Petal. However, by discussing how much you feel this
practise annoys and insults you may be more effective. Just remember to
mention it sweetly when there are no football matches on. There’s ball games
and ball games, he should know! If all else fails buy another TV set.
Dear Hillary,
My maid drives me completely insane. She speaks little English and I am not
fluent in Thai; however, we usually get by with a few words and miming. She
frequently does things which horrify me such as put all the dishes and
glasses and pans together in the sink and attempt to wash them with cold
running water. Or she will wipe the floor with a dishcloth. I patiently
explain and demonstrate the way I want it done, and it is fine for a while
then she will go back to the old ways. Most times she will put clothes away
in the approximate right place but sometimes for no apparent reason will
leave them on the lounge room chair or dresser. Most of the time she does an
average to below average job infuriatingly slowly, though sometimes she will
do something bizarre such as leaving drying washing in kitchen. If I want
something in particular done which should just be routine surely, like
dusting the furniture or defrosting the fridge I have to ask her every
single time. I truly do not know how to make her more efficient. Do you have
any suggestions?
Joan.
Dear Joan,
For a start you will have to lower your own standards. To preserve your
sanity simply do not watch her doing the housework. Go out have fun, change
your focus and adopt a “mai pen rai” attitude. If you cannot simply learn to
put up and shut up then pay more, approximately double, and hire an English
speaking trained housemaid. The other alternative is to do it all yourself.
Welcome to the “dishpan hands” club.
Psychological Perspectives: A psychological perspective on meditation
by Michael Catalanello,
Ph.D.
The importance of Buddhism within Thai
society is reflected virtually everywhere one looks. From ornate
Buddhist wats or temples and beautiful images of the Buddha in his
traditional poses, to the gracious and peaceful temperament of the Thai
people, the influence of Buddhism seems to permeate the culture.
The high degree of respect offered to Buddhist monks and the reverence
accorded Buddhist symbols and rituals are powerful indicators of the
continuing influence of this ancient tradition within contemporary Thai
society. The central practice of Buddhism, meditation, is practiced on a
daily basis by many Thai Buddhists.
The altered physiological and mental states produced by the practice of
meditation have been the object of great interest among psychologists
over the years. Researchers have extensively studied meditation using
devices that measure and record neuroelectric activity in the brain, and
modern brain imaging technologies. A summary of the current state of
psychological understanding of meditation is presented in this month’s
issue of the journal Psychological Bulletin published by the American
Psychological Association.
Meditation is viewed by psychologists as a set of practices that can be
learned as a means of regulating the body and the mind. Like hypnosis,
progressive relaxation, and trance-induction techniques, meditation is
used to bring about a state of relaxation and an altered state of
consciousness.
Two general styles of meditation have been identified: mindfulness and
concentrative techniques. Mindfulness involves allowing one’s thoughts
and feelings to occur as they will, while focusing attention on them
without judgment or analysis. Concentrative techniques focus the
attention upon some sound, image, or sensation. Intense concentration
upon the process of breathing is an example of a commonly used
concentrative technique.
Researchers make a distinction between a meditative state and a trait. A
meditative state refers to the immediate changes in sensations, mental
activity, and self-awareness that can occur during the practice of
meditation. Trait refers to the more lasting changes in those parameters
that remain evident, whether or not the individual is actively
meditating at a given time. The regular practice of meditation has been
shown to produce both short-term state, and long-term trait effects.
State changes are said to include such things as “…a deep sense of calm
peacefulness, a cessation or slowing of the mind’s internal dialogue,
and experiences of perceptual clarity and conscious awareness merging
completely with the object of meditation.” Trait changes include “…a
deepened sense of calmness, increased sense of comfort, heightened
awareness of the sensory field, and a shift in the relationship to
thoughts, feelings, and experience of self.”
A number of psychological benefits have been found to result from
training in meditation techniques. For example, meditation has been
shown to reduce the negative effects of anxiety and stress upon a
person’s psychological and physical functioning. In addition, there is
some suggestion that the rigorous, long-term practice involved in
meditation training could result in long term changes in the way the
central nervous system itself functions. Chemical and hormonal changes
could, in turn, bring about beneficial changes in behavioral traits. For
example, after exposure to stressors in the laboratory, meditation
practitioners have been shown to return more quickly to baseline for
measures of heart rate and skin conductance.
Mindfulness meditation training has also been shown to hold promise for
clinical practice. Improvement in anxiety, immune functioning, pain, and
stress-related skin disorders have all been attributed to the practice
of meditation. A form of cognitive therapy which employs
mindfulness-meditation training has been used effectively to treat
depression.
Those who have practiced meditation over long periods of time are
usually quite enthusiastic concerning the value of meditation. In
addition to the benefits of relaxation and stress management, they often
cite the enhancement of self awareness, understanding, and spiritual
growth. As one with limited personal experience using meditation, I must
defer to the results of the research and to more experienced
practitioners. Perhaps as our knowledge of meditation progresses in the
future, we will better understand the scientific basis for the more
mystical claims of its most ardent promoters.
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Dr. Catalanello is a licensed psychologist in his home State of Louisiana, USA, and a member of the Faculty of Liberal Arts at Asian University,
Chonburi. You may address questions and comments to him at [email protected], or post on his weblog at
http://asianupsych.blogspot.com
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A Female Perspective: Other Mothers
with Sharona Watson
Last week, I wrote about Motherhood from a
personal point of view. But one of the lovely things about having a husband
at work and being able to plan your own time, is that you get to meet lots
of other women in the same situation. Many of them are mothers. So what do
they think about motherhood? I asked some of my best friends, one English,
one Franco-German, what they thought was the most important value that you
can teach your children.
“I think a very good value is honesty,” said my English friend, who is just
about the nicest person in the whole world. She is very modest and prefers
to remain anonymous so I will refer to as, ‘A’. “Children need to be honest.
But there’s no simple answer. I think a very important value is love, not
only love of other people but love of themselves. And to be loving and to be
giving and to be sharing and to be honest – there’s a million and one values
so I don’t think I could say just one. But I hope I’m trying to teach my
children all of these very important values.”
My Franco-German friend is absolutely stunning looking with an incredible
figure – and she’s had three children. What value does she think is most
important? (I’ll call her ‘J’). “The very simple answer is social behaviour
and social intelligence. For me this is the key to a happy childhood and a
happy society later. Other skills they learn in school and academically. A
child will always more easily succeed when it shows social intelligence and
when it feels itself to be a valuable member of a small society or group.
They feel responsible for what they do at a very young age and they decide
what they do to others. I have a key sentence – ‘what you don’t want to be
done to you, don’t do to others’. That’s my slogan for education. I think
when you see branding of people and harassment, that’s a big task nowadays.”
Well, I’d be the first to agree with those sentiments. “Respect for nature
and for each other, is an important value,” added another great friend, (‘Y’
from the Netherlands).
What about how we grew up, I wondered? Were our parents’ values so very
different?
“It’s complexity,” responded ‘J’. “Children have to face more individual
tasks now, whereas we had to focus largely on our own person. Take social
behaviour. When I was young, there was a kind of unspoken code and some
parents were in the position to sort of “meta-supervise” the education of
their children. As women nowadays, we know so much about education. We read,
we inform, we have knowledge about what we do – not only instinctively – so
we try to put all of this in our children and it’s a big deal.”
What about ‘A’? “My parents’ upbringing was completely different for many,
many reasons but I think they tried to teach me the same core values.”
Then I asked ‘A’ the kind of question which nobody really wants to think
about, “What is the greatest fear that you have for your children?” She
thought about it for quite a bit and then replied, “I suppose the everyday
fears a mother has about something bad happening. I have those fears. Of
course, keeping them safe whilst they’re young, teaching them how to keep
themselves safe is important. Also, to be able to make friends but also to
not be too gullible – to be slightly suspicious of people – I have those
fears that children are very gullible, they’re very open to listening to
what people say. I suppose a big fear is that they will grow up and I will
have tried to give them everything I possibly can and for some reason they
won’t be happy. You know, for some reason, whatever they have, won’t be
enough.”
What expectations do you have of your children? Are they fulfilling them? I
asked ‘J’.
“Compared to other women, I don’t think I have a lot of academic
expectations for my children. Socially, I am really delighted most of the
time, especially when my children don’t feel supervised. And when I observe
their social behaviour I can only say that I think I did something right,
because very often they do exactly what I try and teach them to do. They
have it so incorporated already, this idea of being helpful. Apart from
that, I suppose I am lucky that my children don’t fight too much!”
And what about ‘A’? What would you like your two lovely children to become,
when they grow up? “Rich, famous? No, they don’t have to be scientists, they
don’t have to be millionaires, and they don’t have to do any of that! They
have to (she considers the question) not be lazy. As long as they have a
reason to get up in the morning and they are tired when they go to bed and
they are happy doing what they are doing – That’s all I want for them.”
Well, what about now? Do your children meet your expectations of them at the
moment?
“That’s difficult to say. I think mostly yes. If one day as parents, we get
a little disappointed with our children, the next day compensates because
something else happens. I’m very happy with my children. I think most
mothers are.”
One question I think about a lot myself is, “Are children a creation of
their parents or do they grow up independent of them?”
Said ‘A’, “I think it’s a mixture. I think we can do only so much and we can
see part of ourselves in our children but I also have a belief, that they
may be carrying something from somewhere else. Call it Astrology or
whatever; something that you won’t recognise or won’t understand.”
It may come as a surprise to men that we don’t sit around talking about
shopping. At least not all of the time!
Next week: Sitting down with ‘J’
[email protected]
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