Middle East Recovery Strategies after the Financial Crisis

Middle East Recovery Strategies after the Financial Crisis The global business crisis 2007 that started in USA has spread its impacts over the world and no countries economy is spared from its impact. We are aiming to test the willingness of five countries as a case study (Kingdom of Bahrain, Kingdom Saudi Arabia, State of Kuwait, Islamic Republic of Iran, and Republic Turkey) top overcomes the impact of this crisis. We an extensive research study about the economy status before, during and through the process of the recovery from the impacts of the crisis, and conducted two types of questionnaires to gather more information. As a result of our analysis, we found whose countries are actually willing enough to overcome the crisis and who arent. The countries we listed as unwilling to overcome the crisis should apply new strategies if they want to recover it. 1. Introduction Everyone nowadays, no matter what are their background, position or level of education have heard about the global business crisis (in which it includes financial and economic crisis), and felt its impacts in different aspects and on different levels.   It became the talk of the day.   The financial and economic crisis that was initiated in the USAs financial market in 2007 has casted its dark shadows all over the world through the international trade channels. This is because the national systems of almost all countries in the world are interlinked to the USAs market. What made this crisis to become a global phenomenon that is, rapidly and continuously spread from the USA to hit the economy of most countries is the direct link between many currencies to the US dollar. As the US dollar collapsed and hit the rock bottom, it ruthlessly dragged them down along with it.   By observing the US economy, we can see that there are many reasons that are the causes of this crisis. Most of them are related to their strategy; the mistakes in the monetary policy that came from the lack of the global balances and failure of financial regulations (subprime mortgages crisis, where banks encouraged irrational public support for housing investment giving estate loans without pledge).When loaners couldnt fulfill installments due to high interest rates, bankers took over those real estates and attempted to sell them. As this occurred a lot, supply exceeded demand causing huge decreases of prices of estates where the lack of liquidity creating financial crisis led to economic crisis. The global crisis has different levels of effects due to several aspects such as social, educational, financial, economical, political, health and so on. Some of these effects included low economic growth, high unemployment, disrupted international monetary systems, inflation, migration as governments tried to export unemployment elsewhere, etc.   Financial analysts suggested many solutions to o vercome this problem, such as: applying real democracy or thorough reform to existing democratic system,   democratize public service and local government, restructure of finance, extend the scope of financial market, create retail financial instruments to provide greater security to customers, re-specialize economies, reduce global imbalances, reduce income concentration, global governance reform and reeducate economists. A global downturn needs a global response. However, what actually is happening is that suggested and applied individual solutions came from decision makers of the developed countries which are focusing only on their own economics, leaving behind developing countries as victims to this crisis. It is easier for the developed countries to stand back on their feet due to the availability of liquidity, whereas, this is not the case with the developing countries. Our paper focuses on the willingness of five selected countries: Kingdom Of Bahrain, Kingdom Of Saudi Arabia, State of Kuwait, Republic Islamic of Iran, and Republic of Turkey to overcome this crisis. Well discuss the real steps taken by the governments and decision makers in these countries to conclude how effective these steps are. As a result, we will determine whether each of the selected countries have the ability and willingness to overcome this crisis. The aim of this paper is to point out to decision makers whether the mea surements applied in these five countries will help them to recover from this crisis or not and whether the decision makers adapt the right strategies or have to reconsider appropriate solutions. 2. Literature Overview Starting with a general overview of the Middle East impact, we see that the global financial and economic crisis has different levels of negative effects over some specific regions; the Arab region probably is one of the most badly exposed to its negative impacts. Even among this region itself, this can be divided into several groups according to their economic and financial situations. We can say that there is the oil producing countries group; its the group that has the highest GDP and the lowest unemployment rate, in which Bahrain, Kuwait and Saudi Arabia belong to. Such countries got strongly hit by the crisis since they rely on the overseas investments, especially with the US and Europe (Drine, 2009).   The fall was severe for such countries since OPECs price of oil dropped down from $130 per barrel to $40 per barrel (Rivlin, 2009). This is one of the factors that had led to huge damages that we are going to discuss through this chapter; discussing the impact and reaction of t he Global Crisis 2008 over Bahrain, Kuwait, and Saudi Arabia from the GCC. In addition to that, we are going to discuss the impacts and reactions of Turkey and Iran, in which Iran belong to the Middle East countries, but Turkey doesnt, but geographically, its located so close to it. For each country, we cover the situation before, as the occurrence of the crisis and then their attempts to overcome it according to points of view of different economists. Beginning with our own, the Kingdom Of Bahrain, we see that in the past 30 years, it has built its reputation as a financial services region hub (Ford, 2009). It proved to be more liable to the global banking finance in the region, about  ¼ of its GDP comes from the financial sector. 124 banks are established in Bahrain; 24 retail banks, 64 wholesale banks and 26 Islamic banks predominately investment banks. The blooming of Islamic banking is due to CBBs Central Bank of Bahrain which it placed much time and effort to attract new banks and firms, especially the Islamic banks (Matthew, 2009). Like most countries of the world, if not all, situations differed after it got struck by the crisis. As in October 9th 2008, the Prime Minister of Bahrain assured his highness King Hamad Bin Essa Al-Khalifa that the economy of Bahrain was safe because of the sound and clean financial and economic policies adopted by the government of Bahrain (IANS, 2008). However, this is not really the case as it showed later; some problems began to emerge as the result of getting hit by the crisis. Back in October 2008, about $2 billion loss was announced by GIB and ABC banks combined losses from investment that hit the subprime, which meant that Bahrain is one of the most exposed to the subprime assets (Matthew, 2009). In addition to that, Bahrains stock exchange closed down 2.70%, even though it is the least affected percentage among the key Gulf bourses. Some of Bahrains leading banks ( such as Investcorp that is listed by both London and Bahrain- got badly hit, it suffered a net loss of %511 million for 6 months at the end of Dec 2008). Lack of confidence was another problem; Rasheed Al-Maaraj (the governor of CBB Central bank of Bahrain-) stated that a lot of Banks have reported their results and we are confident about the quality of the banks, we do not see any problems yet on their loan profiles. Things have changed dramatically and one of the biggest changes, not only in Bah rain, but in the GCC and across global lack of confidence. Also, Bahrain got hit by the credit crisis not just in the banking sector, huge projects were delayed, such as Al Dur Power and Water project which was by GIS and KFH due to lack of finance, resulting in $2 billion losses (Ford, 2009).   As a natural response of any healthy business environment, the right thing to do is to find resolve those problems and overcome such obstacles. The government of Bahrain and CBB has introduced many measurements to minimize the downturn impact of the crisis. CBB has established a reform plan; it acted like a regulator to make series changes, and it seek to promote the country as an investment destination. Islamic Banking sector is a proposed key solution; this was highlighted by the Banker Magazine survey, which found that Bahrain has the biggest Islamic institutions in the world after the investment Dar of Kuwait (Ithmaar Bank, Arcapita Bank, Gulf Finance House and Islamic Company of the G ulf). (Ford, 2009).   In order to solve the lack of Confidence issue, the CBB aimed to offset the impact of capital outflows on liquidity by setting a scheme to allow banks to exchange their currency from US$ to Bahraini Dinars. However, this is not fully resolved since the Bahraini Dinar is linked to the US$. Sheikh Mohammed bin Essa Al-Khalifa (CEO of the Economic Developed funds) stated that The Major real estate development in Bahrain has been largely backed by Islamic banks and have not suffered from the most part of the credit crunch. In order to improve the credit flows, the banking sector was reformed and redesigned. CBB got involved with many investments and the creation of Islamic banks has increased their economical strength and power regarding their sustainability in long terms. (Matthew, 2009). So far, economists seem to be satisfied by the current economic situation in Bahrain. Moving to the west; to Bahrains good neighbor, Kingdom Of Saudi Arabia. In general, the Arab countries have 20% of the whole worlds gas and oil, however, they are accounted for less than 5% of the worlds total exports of fuel (Rivlin, 2009).   The Kingdom of Saudi Arabia is one of the key oil producing Arab countries; it got blessed by and the economy bloomed after the discovery and production of oil, in which it started to have many huge investment and cash rich companies. As the crisis occurred and hit KSA in its way along with everyone else, the world witnessed a significant dropdown of oil prices, KSA had reduced their productions which led to affecting its oil revenue. This could mean the end of the current surpluses during the recent years. It also affected doing businesses with foreign companies that started to cost more and are no longer easily available as they used to be before the crisis. This had slowed down Saudi Arabias economic growth; caused delaying projects, and r esulted in the lack of confidence. In addition to that, long term policy issues in banking sector appeared; interbank rates had moved up sharply. Also, the stock markets have lost their attraction. Their %GDP had dropped from 28.4 in 2006 down to 24.9 in 2007. Their governments budget went under pressure, and noticeable inflation has appeared (Bourland, 2008). Apparently Saudi Arabias economy is relatively in a good shape, even after it got hit by the crisis and could easily adapt to the situation since they know what they should do, and   what are they going to apply. Mohammed Al-Jasser SAMAs governor- stated that: Our stimulus is mostly for oil production capacity enhancement and also large development projects were implementing. When the projects are finished, then we will reassess the need for additional spending. (Kuwait Times, 2009). SAMA- Saudi Arabia Monetary Agency- had lowered the repo rate and injected liquidity into the banks. One of the Saudi Arabias economical goals is based on completely shifting its focus of economic policy from controlling inflation to restoring confidence in the financial sector. Many companies in KSA are cash rich; thanks to their huge stock of assets, the government of KSA has an advantage over most countries in alleviating the impacts of extreme financial pressures caused by the crisis. The non-oil sector still has a chance for momentum growing, and thus, many projects can be carried out in spite of the existence of some obstacles. That caused, mainly, the limitation of access to higher costs that somewhat slows down the growth of private sectors than it was expected to be (Bourland, 2008). Also, KSA smartly had invested in large numbers in some upstream hydrocarbon projects to get more value from their oil. However, rather than completely relying their energy demands over oil and gas, they had investments in alternative energies so they can export more fuel (Rivlin, 2009).   Thus, based on that, we may assume that KS As economy is in pretty good shape. Going up to the north, there resides the State of Kuwait that once announced a five years $130 billion in an ambitious plan to grow its banking sector to be one of the financial centers in the GCC region before the business tragedy. However, lack of lucidity due to the global crisis, dramatic decrease of oil prices and having a rather poor business environment keeps Kuwait behind its rivals (which Bahrain is one of them). The banking sector in Kuwait has grown largely over the recent years, in which it increased from 2.3% of their nominal GDP in the late 80s to 11.8% GDP in 2007 (which is small compared to Bahrain). Kuwait relied on the high prices of Oil before the crisis occurred to rebus the private and public sector growth (BMI, 2008). The situation started to get bad once the crisis occurred. In 2008, as the global crisis occurred, Kuwaits banking sector fell down to 8.2%. The economy of Kuwait suffered and became under pressure, and the crisis raised interbank interest rates, w here the Central Bank of Kuwait considered this as a liquidity injection into a system. There have also been real estate curbs. (BMI, 2008). Kuwaits Gulf Bank suffered a total loss of $1.54 Billion during the same year. This forced the governments in the gulf to pump money into banks to salvage them (Drine, 2009). In addition to that, inflation reached 11% on June 2008, which was probably the result of the drop down of oil and commodity prices (EIU, 2008). Unlike the GCC currencies, the Kuwaiti Dinar is not paged to the US Dollar; therefore, due to its quasi-independence monetary policy, it shouldnt be dragged down by the US dollar. Sadly however, this flexibility only exists in theory.   Inflammation remained the same in Kuwait as the rest of the GCC. On Sept 23rd 2008, CBK Central Bank of Kuwait- stated to the press that theyll undertake the appropriate measures without hesitation. Itll provide necessary liquidity to any local banking institution. However, it didnt boost it muc h since there was low confidence in economy. It has also raised reserved requirements. The new suggested rule of limiting monthly loan installments from the previous 50% of borrowers salaries to 40% has controlled inflation. Kuwaiti Authorities tried to deal with inflation by active attempts to cut down the loan growth of late. It also has tried to urge lenders to restrict credit growth. (BMI, 2008). Also, the government institutions such as KIA -Kuwait Investment Agency- and the KPC -Kuwait Petroleum Corporation- in addition to the public Authority for Social security deposited their funds in some local commercial banks rather than holding them at the CBK. (EIU, 2008).   Yet, Is Kuwait going to be successful in overcoming the impact of the crisis? By November 2008, NBK National Bank of Kuwait announced a stunning 10.5% raise in 9 months profit, while the KFH (Kuwait Finance House) which is an Islamic Bank   has a 25% increase in profits for the same period of time (EIU, 2008) . Although Kuwait seems to have an opportunity in the banking sector and general business environment in the GCC, its three rivals are still ahead of it. It still has to make changes. However, Manaf Al-Hajeri General Manager of Kuwaits Financial Center Markaz- has a different point of view. He sees that within the next 10 years, the Middle East will still be highly attractive to banking investments, direct investments and asset management, thanks to its high sovereign reserves, favorable demographics and high house formations (MARKAZ, 2009). With such a contradiction in different point of views, the best way to get the accurate answer, to whether Kuwait is going to be successful in overcoming the impact of the global crisis is through an intensive field study. Our next stop resides to the east, The Islamic Republic Iran. Iran is economically isolated from the rest of the world, and thus, many people thought that Iran was secured from the global economic and financial crisis. But thats clearly not the case. The most critical issues that influenced Irans economy is that it heavily depended on the Oil revenues. As the oil prices searched the peak, Irans government was supposed to save a part of its income. However, it spent it all on subsidized lending, massive bank credits, imprudent social spending and substation imports. This phenomenon is known as the Dutch Disease. When the oil prices dropped badly due to the global crisis, Iran suddenly found itself facing a financial crunch. Also, the government of Iran controls more than 80% of its economy due to political reasons after the election of Ahmady Nijad which weakens its economy. In addition to that, the pressures of USAs government and its banks over Irans and the U.N. Security Council sa nctions made the situation even worse. In a healthy economy, the central bank should be independent from the government. However, this is not the current case in Iran, where Nijads government continues its interference in central bank affairs. (Amir, 2008).   As the crisis occurred, Irans economy had already suffered from many problems before the global crisis which made it more vulnerable to impacts of the crisis. Irans banks faced the same problems as its US rivals; they were severely hit by the crisis due to the non-repayment of house loans and that was caused by the decrease of the house prices which turned into the creation of the economic crisis. One of the signs of the impact in Iran is the 60% decrease in applying for constructing license and the complete stagnation in house trading. Abdoh Tabraizi, in a professional conference in Tehran University The Influence of Global Financial Crisis on Iran Economy stated that: the problem of the global economy accrued in Iran was du e to the decrease in house pricing. So, the people who bought the houses will not make their repayments and this happened because of the increase in food and petroleum prices (BBC, 2009). Due to the high dependency of Irans economy on oil revenue, it faced lack of liquidity as the oil prices dropped down, and its currency (the Toman) is facing a devaluation against the other currencies (Amir, 2008). The Republic of Iran denied the Global Crisis impacts over its economy and ignored all the economists warnings regarding its situation. It has no attempts in finding solutions to its current financial and economical situation (Amir, 2009). Leaving west to Europe, to the Republic of Turkey, where it actually faced an interesting event before the global crisis. In the years between 1990 and 2002, Turkey had experienced some very series crisiss that it had to confirm the Global crisis in 2007 through the stability of macroeconomic policies, structural reforms, social security reforms and employment packages that strengthen the financial sector giving it nowadays a strong economic structure compared to the past that could easily resist the impacts of the current global crisis. It had taken its lessons from the past and enabled them to be prepared for the global crisis. Therefore, since the first moment for the global crisis 2008 begins, it didnt touch Turkey very seriously. Turkeys banks didnt fail; all of the banks in Turkey could sustain themselves without any external support (Erdogan, 2009). As it got hit by the crisis from the day of 10 July 2007, in which it is the exact moment of the beginning of the crisis had affe cted Turkey seriously and until now it is still affecting it. Turkish currency showed the most resistance to the falling values comparing to the other currencies. It decreased only by 28% compared to the other currencies (e.g. 31%   Mexican Peso    Russian Ruble, 45% South Korean Won, 34% South African Rand, 40% UK à ¢Ã¢â‚¬Å¡Ã‚ ¤ ). (Erdogan, 2009). In other words, as Ayse Yuksel stated in an interview, Turkey is in a rather great shape compared to the USA, Europe and England itself, also had way less damage in funds and mortgages compared to the USA (Sakar, 2009).   As for the banking sector, instead of becoming a problem like other countries, it became a security value due to its previous experience (Erdogan, 2009).   Turkey had taken many steps to overcome the global crisis; mainly to prevent the liquidity problem. For example, the Turkish Central bank had taken decisions in order to support the markets and the internal demand through the implementation of the monetary p olicy; they took measurements to re-function the credit change in the economy. In addition to implementing temporarily tax reductions in certain sectors such as housing, automotive, electronics, etc, Turkey was able to successfully protect its employees. (Erdogan, 2009). Turkey had announced that there were no problems existed and no actions are warranted; and if were needed, it can inject liquidity into the market and attract the funds held by its citizens overseas account back to Turkey, that is, providing forging currency liquidity (Hurriyet Daily News, 2009). 3. Methodology The purpose of our paper is to determine the willingness and ability of decision makers in our selected five developing Middle Eastern countries to overcome the ongoing economic crisis. According to the nature of our research, we will follow two approaches for collecting the information needed for this research paper. We are going to distribute two types of questionnaires, one for decision makers (type 1) and the other for the public (type 2). Our target population will be selected from Bahrain and we will use quota sampling method of size 170 (70 for type 1 and 100 for type 2). The period for the distribution of the questionnaire will start from the month of November to December 2009. Also we will do an interview with a Bahraini decision maker. Secondly, We will gather information by conducting extensive studying of existing papers, journals and articles regarding our topic; analyzing and comparing all together to reach proper conclusions based on facts and numbers In Type 1 questionnaire, we will include questions in which we can extract from how the decision makers feel about the crisis and what are they going to do to overcome the crisis. And as for Type 2, we will include questions in which we can extract from how the public feel about the crisis and how they are affected by it; how they are going to measure the steps followed by the decision makers in their countries to overcome the crisis. In the two types, we will use quantitative and qualitative questions (from both types distributed) to get needed information to meet our goal. After distributing the questionnaire and analyzing the results using MS-Excel in addition to SPSS software, we will measure how the decision makers reacted towards the global economic crisis are. We have also collected further information by conducting an interview with one of the decision makers in Bahrain who works for a financial sector. 4. Challenges The most significant event in this decade is the Global Economic and Financial Crisis 2008, where no country was spared from its brutal hits and negative effects. After this crisis, economists categorized the countries into two main divisions: the rich countries that have the power to withstand the crisis due to having a huge amount of assets that plays the key role in the process of recovering the impacts of the crisis, whereas the other countries which are not rich, thereby considered poor or average countries are the main victims of the crisis in two aspects; firstly they dont have enough assets for their economy to get back to track. Secondly, the solution strategies taken by rich countries to overcome the crisis do not put them in consideration, keeping them the weakest link (Wade,2009), (Meyn et al, 2009).  Ã‚   This catastrophe, adaption to it and the attempts to recover from it, illustrated to the world the true essence of the health of each countrys economy. In addition to that, it showed how clever and serious the decision makers and governments are in dealing with it. On the other hand, it also points to intentions of decision makers.   We focused on the willingness of five selected Middle Eastern countries (The Kingdom Of Bahrain, Kingdom Saudi Arabia, State Of Kuwait, Islamic Republic of Iran, Republic of Turkey) how decision makers of these countries and governments are willing to recover from the impact of this economical crisis. What procedures have they taken and how successful will they are. Our selection is based on the different nature and situations of the economy of each of the selected countries, and their different political strategies and views. We spotlighted on the Kingdom of Bahrain in our paper by gathering data from the public and decision makes in Bahrain and conducting an interview with a chosen decision maker in order to obtain most accurate result as possible. In addition to analyzing and comparing the published articles an d journals .On the other hand when we consider other countries, we limit our data resources to the existing articles, papers and journals from different  Ã‚  Ã‚   sources to discover the most accurate data that we will build our result on. Thats due to time and geographical constraints.   As a result of this paper, we will categorize the selected countries into those who are willing to recover from the crisis and those who are not. Our main audience is the decision makers, who can take benefits of this paper in evaluating their decisions, adapt it, and change it to make better solutions. Also the public can use the result of this paper to know the correct economic situation of their country, and how their governments are honest in announcing the economic state and whether they are serious to recover from this crisis, as a result they may press on their government to make major steps toward making better solutions. Unfortunately, we have a very limited time to complete the paper while such a research requires much longer time for more accurate data collection. We are enforced to submit the paper by the end of December 2009. Also, we cant reach decision makers because they are hard to find in such a short notice. In addition to that, we are limited to do our questionnaire in Bahrain only due to the geographical limitation. We will try to expand the scope of the questionnaire to include the concerned countries using emails, internet and online technology. 5. Proposed Solution According to the nature of our paper, and the geographical and time constraints, in order to achieve our goal, we will apply two approaches for gathering and analyzing information. The first one will apply to all our selected countries in which it highly depends on comparing and analyzing each countries economists and decision makers statements to sold facts and numbers, including (GDP growth, Oil GDP growth, PCI inflation) which considered to be the most significant signs of the country economical situation,  Ã‚   from neutral international organizations -including the International Monetary Fund (IMF) -. As for the second approach that involves Bahrain only in which we contacted two types of questionnaires and an interview with a decision maker as an add up to the previous approach.   In order to identify whether the financial and economical situation in a country is recovering from the crisis, there are indicators (are known as Economy Indicators) that show whether its improvi ng, stable or turning down. Thus, our questionnaire and interview must be based on it. There are many indicators, but we will consider only on the important ones that are applicable to the business and economy to the countries that we elected. Some of the major indicators (Barnes, 2007, Investopedia ULC) include the following: Consumer Confidence Index (CCI): it shows how healthy the financial situation and determines the expenditures of economy by illustrating the spending power and confidences of consumers. Consumer Credit Report: it indicates the future spending over personal levels and it shows the changing amounts of outstanding loans on individuals. This includes (total debts, current annual rate of growth or decline, and total percentage of credit card delinquencies). It is considered as a major factor that helps to make more than the half of the total GDP. Consumer Price Index (CPI): is seen as a guide for inflation. It focuses on products that consumers buy and use on daily basis. CPI reflects the prices of goods in the markets, and its an important indicator in terms of moving the market and setting the monetary policy. Durable Goods: this involves high priced goods that last for three years, such as machinery, technology manufacturing, cars and other vehicles which indicates general economic expansions.   Employee Cost Index (ECI): it indicates the percentage of changes in employees salaries, bounces, and benefits in terms of wages per hours. It calculates the total cost of employees for a business. Employment Situation:   this indicates employment and unemployment rate. Its useful to understand the state of labor force.   This indicator could move the market dramatically. Gross Domestic Product (GDP): its an aggregate measure of the total economic production for a country. It is one of the most important indicators that illustrates the health of economy and, depending on it, prices of good and services are set in a certain country. It involve s personal consumption, investments, government expenditures, and the exports in a particular country. Existing Home Sales and Housing Starts: are two indicators that come in conjunctions, and this, illustrates the housing market in general. Those are long term indictors that show how many houses are sold. It deals with construction level, which means it shows also supply needed for it, and it shows the demand of consumers and comes in pretty handy in real estate markets. Money Supply: it is the amount of money floating around the economy and it is available for spending. It is controlled by the Central Bank of the country. Money Supply is based on how liquid the money is, which can directly affect economic growth and inflation. Mutual Funds Flows: this is an important concept in which to understand stocks and bond marketing. Non-Manufacturing activities: they involve service industries, such as telecommunications, in which they provide insight into the business area that may not be covered by other indicators. Product Price Index (PPI): its an index to the prices measured by the wholesalers, producers, and retailers that are considered the most powerful contributors to the consumer markets. The index comes in three levels: PPI Commodity Index that involves certain commodities such as crude oil; PPI stage of processing (SOP) Index where products are in an intermediate stage; and PPI Industry Index that involves the final stage and finished manufacturing of the products. And finally, theres the Trade Balance Report: it indicates the health of the economy of a country and its relationships with the rest of the world (Barnes, 2007). Our goal is to get a clear full view of the economy in a country. So, we designed two types of questionnaires, one for aimed for decision makers (type 1) and the other is aimed for the public (type 2), in which both questionnaires are based on economic indicators that we mentioned earlier. For both questionnaires, the methodology is CATI -Computer Aided Telephone Interview-, online form, paper forms, the framework timing is 2 21 December 2009, regarding samples, our goal is at least 69 for each type, our sampling method is quota, and our geographical coverage: Kingdom of Bahrain. In Type 1 questionnaire, we Middle East Recovery Strategies after the Financial Crisis Middle East Recovery Strategies after the Financial Crisis The global business crisis 2007 that started in USA has spread its impacts over the world and no countries economy is spared from its impact. We are aiming to test the willingness of five countries as a case study (Kingdom of Bahrain, Kingdom Saudi Arabia, State of Kuwait, Islamic Republic of Iran, and Republic Turkey) top overcomes the impact of this crisis. We an extensive research study about the economy status before, during and through the process of the recovery from the impacts of the crisis, and conducted two types of questionnaires to gather more information. As a result of our analysis, we found whose countries are actually willing enough to overcome the crisis and who arent. The countries we listed as unwilling to overcome the crisis should apply new strategies if they want to recover it. 1. Introduction Everyone nowadays, no matter what are their background, position or level of education have heard about the global business crisis (in which it includes financial and economic crisis), and felt its impacts in different aspects and on different levels.   It became the talk of the day.   The financial and economic crisis that was initiated in the USAs financial market in 2007 has casted its dark shadows all over the world through the international trade channels. This is because the national systems of almost all countries in the world are interlinked to the USAs market. What made this crisis to become a global phenomenon that is, rapidly and continuously spread from the USA to hit the economy of most countries is the direct link between many currencies to the US dollar. As the US dollar collapsed and hit the rock bottom, it ruthlessly dragged them down along with it.   By observing the US economy, we can see that there are many reasons that are the causes of this crisis. Most of them are related to their strategy; the mistakes in the monetary policy that came from the lack of the global balances and failure of financial regulations (subprime mortgages crisis, where banks encouraged irrational public support for housing investment giving estate loans without pledge).When loaners couldnt fulfill installments due to high interest rates, bankers took over those real estates and attempted to sell them. As this occurred a lot, supply exceeded demand causing huge decreases of prices of estates where the lack of liquidity creating financial crisis led to economic crisis. The global crisis has different levels of effects due to several aspects such as social, educational, financial, economical, political, health and so on. Some of these effects included low economic growth, high unemployment, disrupted international monetary systems, inflation, migration as governments tried to export unemployment elsewhere, etc.   Financial analysts suggested many solutions to o vercome this problem, such as: applying real democracy or thorough reform to existing democratic system,   democratize public service and local government, restructure of finance, extend the scope of financial market, create retail financial instruments to provide greater security to customers, re-specialize economies, reduce global imbalances, reduce income concentration, global governance reform and reeducate economists. A global downturn needs a global response. However, what actually is happening is that suggested and applied individual solutions came from decision makers of the developed countries which are focusing only on their own economics, leaving behind developing countries as victims to this crisis. It is easier for the developed countries to stand back on their feet due to the availability of liquidity, whereas, this is not the case with the developing countries. Our paper focuses on the willingness of five selected countries: Kingdom Of Bahrain, Kingdom Of Saudi Arabia, State of Kuwait, Republic Islamic of Iran, and Republic of Turkey to overcome this crisis. Well discuss the real steps taken by the governments and decision makers in these countries to conclude how effective these steps are. As a result, we will determine whether each of the selected countries have the ability and willingness to overcome this crisis. The aim of this paper is to point out to decision makers whether the mea surements applied in these five countries will help them to recover from this crisis or not and whether the decision makers adapt the right strategies or have to reconsider appropriate solutions. 2. Literature Overview Starting with a general overview of the Middle East impact, we see that the global financial and economic crisis has different levels of negative effects over some specific regions; the Arab region probably is one of the most badly exposed to its negative impacts. Even among this region itself, this can be divided into several groups according to their economic and financial situations. We can say that there is the oil producing countries group; its the group that has the highest GDP and the lowest unemployment rate, in which Bahrain, Kuwait and Saudi Arabia belong to. Such countries got strongly hit by the crisis since they rely on the overseas investments, especially with the US and Europe (Drine, 2009).   The fall was severe for such countries since OPECs price of oil dropped down from $130 per barrel to $40 per barrel (Rivlin, 2009). This is one of the factors that had led to huge damages that we are going to discuss through this chapter; discussing the impact and reaction of t he Global Crisis 2008 over Bahrain, Kuwait, and Saudi Arabia from the GCC. In addition to that, we are going to discuss the impacts and reactions of Turkey and Iran, in which Iran belong to the Middle East countries, but Turkey doesnt, but geographically, its located so close to it. For each country, we cover the situation before, as the occurrence of the crisis and then their attempts to overcome it according to points of view of different economists. Beginning with our own, the Kingdom Of Bahrain, we see that in the past 30 years, it has built its reputation as a financial services region hub (Ford, 2009). It proved to be more liable to the global banking finance in the region, about  ¼ of its GDP comes from the financial sector. 124 banks are established in Bahrain; 24 retail banks, 64 wholesale banks and 26 Islamic banks predominately investment banks. The blooming of Islamic banking is due to CBBs Central Bank of Bahrain which it placed much time and effort to attract new banks and firms, especially the Islamic banks (Matthew, 2009). Like most countries of the world, if not all, situations differed after it got struck by the crisis. As in October 9th 2008, the Prime Minister of Bahrain assured his highness King Hamad Bin Essa Al-Khalifa that the economy of Bahrain was safe because of the sound and clean financial and economic policies adopted by the government of Bahrain (IANS, 2008). However, this is not really the case as it showed later; some problems began to emerge as the result of getting hit by the crisis. Back in October 2008, about $2 billion loss was announced by GIB and ABC banks combined losses from investment that hit the subprime, which meant that Bahrain is one of the most exposed to the subprime assets (Matthew, 2009). In addition to that, Bahrains stock exchange closed down 2.70%, even though it is the least affected percentage among the key Gulf bourses. Some of Bahrains leading banks ( such as Investcorp that is listed by both London and Bahrain- got badly hit, it suffered a net loss of %511 million for 6 months at the end of Dec 2008). Lack of confidence was another problem; Rasheed Al-Maaraj (the governor of CBB Central bank of Bahrain-) stated that a lot of Banks have reported their results and we are confident about the quality of the banks, we do not see any problems yet on their loan profiles. Things have changed dramatically and one of the biggest changes, not only in Bah rain, but in the GCC and across global lack of confidence. Also, Bahrain got hit by the credit crisis not just in the banking sector, huge projects were delayed, such as Al Dur Power and Water project which was by GIS and KFH due to lack of finance, resulting in $2 billion losses (Ford, 2009).   As a natural response of any healthy business environment, the right thing to do is to find resolve those problems and overcome such obstacles. The government of Bahrain and CBB has introduced many measurements to minimize the downturn impact of the crisis. CBB has established a reform plan; it acted like a regulator to make series changes, and it seek to promote the country as an investment destination. Islamic Banking sector is a proposed key solution; this was highlighted by the Banker Magazine survey, which found that Bahrain has the biggest Islamic institutions in the world after the investment Dar of Kuwait (Ithmaar Bank, Arcapita Bank, Gulf Finance House and Islamic Company of the G ulf). (Ford, 2009).   In order to solve the lack of Confidence issue, the CBB aimed to offset the impact of capital outflows on liquidity by setting a scheme to allow banks to exchange their currency from US$ to Bahraini Dinars. However, this is not fully resolved since the Bahraini Dinar is linked to the US$. Sheikh Mohammed bin Essa Al-Khalifa (CEO of the Economic Developed funds) stated that The Major real estate development in Bahrain has been largely backed by Islamic banks and have not suffered from the most part of the credit crunch. In order to improve the credit flows, the banking sector was reformed and redesigned. CBB got involved with many investments and the creation of Islamic banks has increased their economical strength and power regarding their sustainability in long terms. (Matthew, 2009). So far, economists seem to be satisfied by the current economic situation in Bahrain. Moving to the west; to Bahrains good neighbor, Kingdom Of Saudi Arabia. In general, the Arab countries have 20% of the whole worlds gas and oil, however, they are accounted for less than 5% of the worlds total exports of fuel (Rivlin, 2009).   The Kingdom of Saudi Arabia is one of the key oil producing Arab countries; it got blessed by and the economy bloomed after the discovery and production of oil, in which it started to have many huge investment and cash rich companies. As the crisis occurred and hit KSA in its way along with everyone else, the world witnessed a significant dropdown of oil prices, KSA had reduced their productions which led to affecting its oil revenue. This could mean the end of the current surpluses during the recent years. It also affected doing businesses with foreign companies that started to cost more and are no longer easily available as they used to be before the crisis. This had slowed down Saudi Arabias economic growth; caused delaying projects, and r esulted in the lack of confidence. In addition to that, long term policy issues in banking sector appeared; interbank rates had moved up sharply. Also, the stock markets have lost their attraction. Their %GDP had dropped from 28.4 in 2006 down to 24.9 in 2007. Their governments budget went under pressure, and noticeable inflation has appeared (Bourland, 2008). Apparently Saudi Arabias economy is relatively in a good shape, even after it got hit by the crisis and could easily adapt to the situation since they know what they should do, and   what are they going to apply. Mohammed Al-Jasser SAMAs governor- stated that: Our stimulus is mostly for oil production capacity enhancement and also large development projects were implementing. When the projects are finished, then we will reassess the need for additional spending. (Kuwait Times, 2009). SAMA- Saudi Arabia Monetary Agency- had lowered the repo rate and injected liquidity into the banks. One of the Saudi Arabias economical goals is based on completely shifting its focus of economic policy from controlling inflation to restoring confidence in the financial sector. Many companies in KSA are cash rich; thanks to their huge stock of assets, the government of KSA has an advantage over most countries in alleviating the impacts of extreme financial pressures caused by the crisis. The non-oil sector still has a chance for momentum growing, and thus, many projects can be carried out in spite of the existence of some obstacles. That caused, mainly, the limitation of access to higher costs that somewhat slows down the growth of private sectors than it was expected to be (Bourland, 2008). Also, KSA smartly had invested in large numbers in some upstream hydrocarbon projects to get more value from their oil. However, rather than completely relying their energy demands over oil and gas, they had investments in alternative energies so they can export more fuel (Rivlin, 2009).   Thus, based on that, we may assume that KS As economy is in pretty good shape. Going up to the north, there resides the State of Kuwait that once announced a five years $130 billion in an ambitious plan to grow its banking sector to be one of the financial centers in the GCC region before the business tragedy. However, lack of lucidity due to the global crisis, dramatic decrease of oil prices and having a rather poor business environment keeps Kuwait behind its rivals (which Bahrain is one of them). The banking sector in Kuwait has grown largely over the recent years, in which it increased from 2.3% of their nominal GDP in the late 80s to 11.8% GDP in 2007 (which is small compared to Bahrain). Kuwait relied on the high prices of Oil before the crisis occurred to rebus the private and public sector growth (BMI, 2008). The situation started to get bad once the crisis occurred. In 2008, as the global crisis occurred, Kuwaits banking sector fell down to 8.2%. The economy of Kuwait suffered and became under pressure, and the crisis raised interbank interest rates, w here the Central Bank of Kuwait considered this as a liquidity injection into a system. There have also been real estate curbs. (BMI, 2008). Kuwaits Gulf Bank suffered a total loss of $1.54 Billion during the same year. This forced the governments in the gulf to pump money into banks to salvage them (Drine, 2009). In addition to that, inflation reached 11% on June 2008, which was probably the result of the drop down of oil and commodity prices (EIU, 2008). Unlike the GCC currencies, the Kuwaiti Dinar is not paged to the US Dollar; therefore, due to its quasi-independence monetary policy, it shouldnt be dragged down by the US dollar. Sadly however, this flexibility only exists in theory.   Inflammation remained the same in Kuwait as the rest of the GCC. On Sept 23rd 2008, CBK Central Bank of Kuwait- stated to the press that theyll undertake the appropriate measures without hesitation. Itll provide necessary liquidity to any local banking institution. However, it didnt boost it muc h since there was low confidence in economy. It has also raised reserved requirements. The new suggested rule of limiting monthly loan installments from the previous 50% of borrowers salaries to 40% has controlled inflation. Kuwaiti Authorities tried to deal with inflation by active attempts to cut down the loan growth of late. It also has tried to urge lenders to restrict credit growth. (BMI, 2008). Also, the government institutions such as KIA -Kuwait Investment Agency- and the KPC -Kuwait Petroleum Corporation- in addition to the public Authority for Social security deposited their funds in some local commercial banks rather than holding them at the CBK. (EIU, 2008).   Yet, Is Kuwait going to be successful in overcoming the impact of the crisis? By November 2008, NBK National Bank of Kuwait announced a stunning 10.5% raise in 9 months profit, while the KFH (Kuwait Finance House) which is an Islamic Bank   has a 25% increase in profits for the same period of time (EIU, 2008) . Although Kuwait seems to have an opportunity in the banking sector and general business environment in the GCC, its three rivals are still ahead of it. It still has to make changes. However, Manaf Al-Hajeri General Manager of Kuwaits Financial Center Markaz- has a different point of view. He sees that within the next 10 years, the Middle East will still be highly attractive to banking investments, direct investments and asset management, thanks to its high sovereign reserves, favorable demographics and high house formations (MARKAZ, 2009). With such a contradiction in different point of views, the best way to get the accurate answer, to whether Kuwait is going to be successful in overcoming the impact of the global crisis is through an intensive field study. Our next stop resides to the east, The Islamic Republic Iran. Iran is economically isolated from the rest of the world, and thus, many people thought that Iran was secured from the global economic and financial crisis. But thats clearly not the case. The most critical issues that influenced Irans economy is that it heavily depended on the Oil revenues. As the oil prices searched the peak, Irans government was supposed to save a part of its income. However, it spent it all on subsidized lending, massive bank credits, imprudent social spending and substation imports. This phenomenon is known as the Dutch Disease. When the oil prices dropped badly due to the global crisis, Iran suddenly found itself facing a financial crunch. Also, the government of Iran controls more than 80% of its economy due to political reasons after the election of Ahmady Nijad which weakens its economy. In addition to that, the pressures of USAs government and its banks over Irans and the U.N. Security Council sa nctions made the situation even worse. In a healthy economy, the central bank should be independent from the government. However, this is not the current case in Iran, where Nijads government continues its interference in central bank affairs. (Amir, 2008).   As the crisis occurred, Irans economy had already suffered from many problems before the global crisis which made it more vulnerable to impacts of the crisis. Irans banks faced the same problems as its US rivals; they were severely hit by the crisis due to the non-repayment of house loans and that was caused by the decrease of the house prices which turned into the creation of the economic crisis. One of the signs of the impact in Iran is the 60% decrease in applying for constructing license and the complete stagnation in house trading. Abdoh Tabraizi, in a professional conference in Tehran University The Influence of Global Financial Crisis on Iran Economy stated that: the problem of the global economy accrued in Iran was du e to the decrease in house pricing. So, the people who bought the houses will not make their repayments and this happened because of the increase in food and petroleum prices (BBC, 2009). Due to the high dependency of Irans economy on oil revenue, it faced lack of liquidity as the oil prices dropped down, and its currency (the Toman) is facing a devaluation against the other currencies (Amir, 2008). The Republic of Iran denied the Global Crisis impacts over its economy and ignored all the economists warnings regarding its situation. It has no attempts in finding solutions to its current financial and economical situation (Amir, 2009). Leaving west to Europe, to the Republic of Turkey, where it actually faced an interesting event before the global crisis. In the years between 1990 and 2002, Turkey had experienced some very series crisiss that it had to confirm the Global crisis in 2007 through the stability of macroeconomic policies, structural reforms, social security reforms and employment packages that strengthen the financial sector giving it nowadays a strong economic structure compared to the past that could easily resist the impacts of the current global crisis. It had taken its lessons from the past and enabled them to be prepared for the global crisis. Therefore, since the first moment for the global crisis 2008 begins, it didnt touch Turkey very seriously. Turkeys banks didnt fail; all of the banks in Turkey could sustain themselves without any external support (Erdogan, 2009). As it got hit by the crisis from the day of 10 July 2007, in which it is the exact moment of the beginning of the crisis had affe cted Turkey seriously and until now it is still affecting it. Turkish currency showed the most resistance to the falling values comparing to the other currencies. It decreased only by 28% compared to the other currencies (e.g. 31%   Mexican Peso    Russian Ruble, 45% South Korean Won, 34% South African Rand, 40% UK à ¢Ã¢â‚¬Å¡Ã‚ ¤ ). (Erdogan, 2009). In other words, as Ayse Yuksel stated in an interview, Turkey is in a rather great shape compared to the USA, Europe and England itself, also had way less damage in funds and mortgages compared to the USA (Sakar, 2009).   As for the banking sector, instead of becoming a problem like other countries, it became a security value due to its previous experience (Erdogan, 2009).   Turkey had taken many steps to overcome the global crisis; mainly to prevent the liquidity problem. For example, the Turkish Central bank had taken decisions in order to support the markets and the internal demand through the implementation of the monetary p olicy; they took measurements to re-function the credit change in the economy. In addition to implementing temporarily tax reductions in certain sectors such as housing, automotive, electronics, etc, Turkey was able to successfully protect its employees. (Erdogan, 2009). Turkey had announced that there were no problems existed and no actions are warranted; and if were needed, it can inject liquidity into the market and attract the funds held by its citizens overseas account back to Turkey, that is, providing forging currency liquidity (Hurriyet Daily News, 2009). 3. Methodology The purpose of our paper is to determine the willingness and ability of decision makers in our selected five developing Middle Eastern countries to overcome the ongoing economic crisis. According to the nature of our research, we will follow two approaches for collecting the information needed for this research paper. We are going to distribute two types of questionnaires, one for decision makers (type 1) and the other for the public (type 2). Our target population will be selected from Bahrain and we will use quota sampling method of size 170 (70 for type 1 and 100 for type 2). The period for the distribution of the questionnaire will start from the month of November to December 2009. Also we will do an interview with a Bahraini decision maker. Secondly, We will gather information by conducting extensive studying of existing papers, journals and articles regarding our topic; analyzing and comparing all together to reach proper conclusions based on facts and numbers In Type 1 questionnaire, we will include questions in which we can extract from how the decision makers feel about the crisis and what are they going to do to overcome the crisis. And as for Type 2, we will include questions in which we can extract from how the public feel about the crisis and how they are affected by it; how they are going to measure the steps followed by the decision makers in their countries to overcome the crisis. In the two types, we will use quantitative and qualitative questions (from both types distributed) to get needed information to meet our goal. After distributing the questionnaire and analyzing the results using MS-Excel in addition to SPSS software, we will measure how the decision makers reacted towards the global economic crisis are. We have also collected further information by conducting an interview with one of the decision makers in Bahrain who works for a financial sector. 4. Challenges The most significant event in this decade is the Global Economic and Financial Crisis 2008, where no country was spared from its brutal hits and negative effects. After this crisis, economists categorized the countries into two main divisions: the rich countries that have the power to withstand the crisis due to having a huge amount of assets that plays the key role in the process of recovering the impacts of the crisis, whereas the other countries which are not rich, thereby considered poor or average countries are the main victims of the crisis in two aspects; firstly they dont have enough assets for their economy to get back to track. Secondly, the solution strategies taken by rich countries to overcome the crisis do not put them in consideration, keeping them the weakest link (Wade,2009), (Meyn et al, 2009).  Ã‚   This catastrophe, adaption to it and the attempts to recover from it, illustrated to the world the true essence of the health of each countrys economy. In addition to that, it showed how clever and serious the decision makers and governments are in dealing with it. On the other hand, it also points to intentions of decision makers.   We focused on the willingness of five selected Middle Eastern countries (The Kingdom Of Bahrain, Kingdom Saudi Arabia, State Of Kuwait, Islamic Republic of Iran, Republic of Turkey) how decision makers of these countries and governments are willing to recover from the impact of this economical crisis. What procedures have they taken and how successful will they are. Our selection is based on the different nature and situations of the economy of each of the selected countries, and their different political strategies and views. We spotlighted on the Kingdom of Bahrain in our paper by gathering data from the public and decision makes in Bahrain and conducting an interview with a chosen decision maker in order to obtain most accurate result as possible. In addition to analyzing and comparing the published articles an d journals .On the other hand when we consider other countries, we limit our data resources to the existing articles, papers and journals from different  Ã‚  Ã‚   sources to discover the most accurate data that we will build our result on. Thats due to time and geographical constraints.   As a result of this paper, we will categorize the selected countries into those who are willing to recover from the crisis and those who are not. Our main audience is the decision makers, who can take benefits of this paper in evaluating their decisions, adapt it, and change it to make better solutions. Also the public can use the result of this paper to know the correct economic situation of their country, and how their governments are honest in announcing the economic state and whether they are serious to recover from this crisis, as a result they may press on their government to make major steps toward making better solutions. Unfortunately, we have a very limited time to complete the paper while such a research requires much longer time for more accurate data collection. We are enforced to submit the paper by the end of December 2009. Also, we cant reach decision makers because they are hard to find in such a short notice. In addition to that, we are limited to do our questionnaire in Bahrain only due to the geographical limitation. We will try to expand the scope of the questionnaire to include the concerned countries using emails, internet and online technology. 5. Proposed Solution According to the nature of our paper, and the geographical and time constraints, in order to achieve our goal, we will apply two approaches for gathering and analyzing information. The first one will apply to all our selected countries in which it highly depends on comparing and analyzing each countries economists and decision makers statements to sold facts and numbers, including (GDP growth, Oil GDP growth, PCI inflation) which considered to be the most significant signs of the country economical situation,  Ã‚   from neutral international organizations -including the International Monetary Fund (IMF) -. As for the second approach that involves Bahrain only in which we contacted two types of questionnaires and an interview with a decision maker as an add up to the previous approach.   In order to identify whether the financial and economical situation in a country is recovering from the crisis, there are indicators (are known as Economy Indicators) that show whether its improvi ng, stable or turning down. Thus, our questionnaire and interview must be based on it. There are many indicators, but we will consider only on the important ones that are applicable to the business and economy to the countries that we elected. Some of the major indicators (Barnes, 2007, Investopedia ULC) include the following: Consumer Confidence Index (CCI): it shows how healthy the financial situation and determines the expenditures of economy by illustrating the spending power and confidences of consumers. Consumer Credit Report: it indicates the future spending over personal levels and it shows the changing amounts of outstanding loans on individuals. This includes (total debts, current annual rate of growth or decline, and total percentage of credit card delinquencies). It is considered as a major factor that helps to make more than the half of the total GDP. Consumer Price Index (CPI): is seen as a guide for inflation. It focuses on products that consumers buy and use on daily basis. CPI reflects the prices of goods in the markets, and its an important indicator in terms of moving the market and setting the monetary policy. Durable Goods: this involves high priced goods that last for three years, such as machinery, technology manufacturing, cars and other vehicles which indicates general economic expansions.   Employee Cost Index (ECI): it indicates the percentage of changes in employees salaries, bounces, and benefits in terms of wages per hours. It calculates the total cost of employees for a business. Employment Situation:   this indicates employment and unemployment rate. Its useful to understand the state of labor force.   This indicator could move the market dramatically. Gross Domestic Product (GDP): its an aggregate measure of the total economic production for a country. It is one of the most important indicators that illustrates the health of economy and, depending on it, prices of good and services are set in a certain country. It involve s personal consumption, investments, government expenditures, and the exports in a particular country. Existing Home Sales and Housing Starts: are two indicators that come in conjunctions, and this, illustrates the housing market in general. Those are long term indictors that show how many houses are sold. It deals with construction level, which means it shows also supply needed for it, and it shows the demand of consumers and comes in pretty handy in real estate markets. Money Supply: it is the amount of money floating around the economy and it is available for spending. It is controlled by the Central Bank of the country. Money Supply is based on how liquid the money is, which can directly affect economic growth and inflation. Mutual Funds Flows: this is an important concept in which to understand stocks and bond marketing. Non-Manufacturing activities: they involve service industries, such as telecommunications, in which they provide insight into the business area that may not be covered by other indicators. Product Price Index (PPI): its an index to the prices measured by the wholesalers, producers, and retailers that are considered the most powerful contributors to the consumer markets. The index comes in three levels: PPI Commodity Index that involves certain commodities such as crude oil; PPI stage of processing (SOP) Index where products are in an intermediate stage; and PPI Industry Index that involves the final stage and finished manufacturing of the products. And finally, theres the Trade Balance Report: it indicates the health of the economy of a country and its relationships with the rest of the world (Barnes, 2007). Our goal is to get a clear full view of the economy in a country. So, we designed two types of questionnaires, one for aimed for decision makers (type 1) and the other is aimed for the public (type 2), in which both questionnaires are based on economic indicators that we mentioned earlier. For both questionnaires, the methodology is CATI -Computer Aided Telephone Interview-, online form, paper forms, the framework timing is 2 21 December 2009, regarding samples, our goal is at least 69 for each type, our sampling method is quota, and our geographical coverage: Kingdom of Bahrain. In Type 1 questionnaire, we

Effects in Mass Media Essay

What was the major development in evolution of mass media in the 20th century The mass media included television, radio, newspaper and telephone. Before television, there was morse code, but later the telephone came in to play, people decided that it was much easier than waiting for a telegram. Before the invention of television there was the radio, this was considered the main form of entertainment for a family, the radio contained talk shows and advertisements read over the radio from different stores. Newspapers have been around for ages, they were pretty much the communication for cities, towns and small communities. Everything changed when television made an appearance in 1935. The first television set was black and white, mostly they were owned by people who were considered rich, later it became affordable for more families to own. The three major programs offered were ABC, CBS and NBC, later on the color television set was developed. Later on the computer was developed, they seemed too large for households, so most computers were used by the government, after that Apple developed a computer smaller for household use, more and more companies have developed better technology with the computer, television and the internet. How did each development influence America How did these influence America, The newspaper gave the news, it had no other purpose, but as it developed it was used for other purposes, today the newspaper is used for comments and criticism, this involves social, political and religion, this also vents grievances. The radio became very popular, it became the opportunity to speak to people in their homes, it changed the consumer marketing and was a link for entertainment information and product consumption, another use of radio was the war, they used for the detection of planes and ships which was called radar. By the 1950’s radio was lost to television. Television was the main source of entertainment, when kids came home from school, the first thing they do is turn on the television, people use television for a form of relaxation, especially after a long day at work. Today there are thousands if not millions of television stations, due to technological progress, today televisions stations are available in every part of the world, and has been a very influential part of culture. The telephone has made communication with people better and faster, you can contact anyone, anytime of the day. The first rotary phone was developed in 1923, later on the touch tone phone. A few years later the cordless phone came out, this was great, you could move around your home and still talk on the phone. Then later on a new technology was on the rise, the cell phone, now there was no more setting around waiting on a phone call, after that the internet, the phone had more of an impact than any other technology.

Pro euthanasia Free Essay Example, 1000 words

The subject of euthanasia has become of increasing interest as the number of patients who are treated in the hospitals for euthanasia related issues have increased. The patients who mainly visit their physicians for euthanasia suffer from lethal and life hampering pathological conditions that greatly alters the living standards and the quality of life of those individuals. These people wish to end their lives with dignity as the pain and suffering in their life is beyond treatment and beyond their control. Furthermore, if this issue is considered with a different perspective, it can be seen that people who are suffering from fatal conditions require excessive monitoring and they may interfere with the treatment of other patients who suffer from curable diseases. Also, the number of people visiting the hospitals has greatly increased over the years. Thus, if a person consents to and pleads the physician for a dignified death, he should be granted the permission to do so (Quaghebeur e t al 2009). There has been strong opposition against the case of euthanasia by religious as well as ethical groups. According to religious groups, euthanasia is a process of killing someone and it is an unforgiveable act owing to the fact that the master of life and death is god. We will write a custom essay sample on Pro euthanasia or any topic specifically for you Only $17.96 $11.86/page It is a subject which is the center of argument for religious, ethical and legal communities. It is a practice whereby the life of an individual is ended by the assistance of the physician owing to the deteriorating medical health of the patient. It is an option for those people who lead lives of dependence and there is no room for improvement in their condition.