PREFACE
It is the requirement of the B.COM course Lahore College for Women University, Lahore that all students of B.COM have to spend six or eight weeks in any organization to get practical exposure and to get familiarized with the ways to live in the organizational environment which is dramatically different from the educational environment. That two months period called “Internship Period”, if spent properly and sincerely, enables the students to be more confident, more knowledgeable, more responsible and, above all, more committed to its work in the practical field. I have also been assigned to do internship of six weeks period in MCB Allama Iqbal Town Branch Lahore. It has enabled me to understand the practical scenario and
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Banking in fact is primitive as human society, for ever since man came to realize the importance of money as a medium of exchange, the necessity of a controlling or regulating agency or institution was naturally felt. The priests in Greece used to keep money and valuables of the people in temples. These priests thus acted as financial agents. The origin of banking is also traced to early goldsmiths. They used to keep strong safes for storing the money and valuables of the people. The first stage in the development of modern banking, thus, was the accepting of deposits of cash from those persons who had surplus money with them. The goldsmiths used to issue receipts for the money deposited with them. These receipts began to pass from hand to hand in settlement of transactions because people had confidence in the integrity and solvency of goldsmiths. When it was found that these receipts were fully accepted in payment of debts; then the receipts were drawn in such a way that it entitled any holder to claim the specified amount of money from goldsmiths. A depositor who is to make the payments may now get the money in cash from goldsmiths or pay over the receipt to the creditor. These receipts were the earlier bank notes. The second stage in the development of banking thus was the issue of bank notes. The goldsmiths soon discovered that all the people who had deposited money with them do not come to withdraw their funds in cash. They found that only a few persons
Internship is a six to eight weeks working experience in any organization. The purpose behind doing an internship is to get familiar with a professional working environment. Often students do internships during there vacations so as to gain experience in their field of interest. Students studying engineering, computer science, textiles or business management; they are required to perform at least an internship so as to receive degree from their respective institutions. The purpose of writing this essay is to share my wonderful working experience as an internee at Spyglass Winery. I loved every minute of it as I discovered several new skills and came across with some interesting job opportunities. This statistical analysis (www.fasttrackinternships.com) shows the rate of full time job placements according to the number of internships completed.
Even before the creation of the Federal Reserve, banks were used by the public just as we use them today. Deposits were made into savings accounts. Loans were taken out to mortgage a home or finance a new business. Banknotes were issued and spent when the public borrowed from the banks. Borrowers spent these banknotes just as paper money is spent today. These bank notes were valued as money since they were backed by the promise that they would be exchanged on demand for either gold or silver.
Secondly, out of the twenty-five stockholders of the Bank, five of these were government owned. Thus showing support of the Bank by subscribing to one-fifth of its $35 million (Schlesinger 74). In addition, among the Bank’s functions was to hold all government money, sell all government bonds, and make commercial loans. However, no voters could dictate its policies or reign in its power, due to its privately owned status (Roughshod 2). Finally, the government also allowed bank notes to be used as payment for taxes.
In response to this panic, a committee was established to find the flaws of the current banking system. This committee, the National Monetary Commission, found there were two main flaws dominating the system. First, the currency was not responsive to changes in demand. (Born...13). This meant that the bank had a fixed amount of currency, regardless of the
Before the Federal Reserve Act was passed, the U.S tried many different things to create a banking system that worked. The first paper money was made to finance the American Revolution. The money was called "continentals". The fiat money notes were issued in such quantity they led to inflation, which, though mild at first, quickly accelerated as the war progressed. In 1791, congress created the First Bank of the United States. It was the
Without a bank, it would be more likely for a person to get robbed. Alexander Hamilton also made the first newspaper. Today we still use the same newspaper. This is how people still learn about what is happening in the world. Today many people use the internet to get their information.
It was one of the earliest monetary policies to institute the circulation of paper money on a national level. Customers would deposit their gold coins for storage into a bank for a small fee. In return, they received bank receipts, which were then used as paper money in place of valuable elements like gold. The idea of using bank notes as paper money quickly gained popularity because they were, of course, much easier and more convenient to transport and exchange than heavy gold coins.
During the twenty years it was in place the First Bank did change the economic downturn of the country after the war. The First Bank had branches in eight influential port cities and had a wide geographic existence. It influenced the lending policies of the state banks’ lending practices. The First Bank was like the state banks in that it made business loans, accepted deposits, and issued notes that circulated as currency and were convertible into gold or silver. But it differed from the state banks because its
The banking industry has over the years evolved from simple to large and complex organization. They have grown from one street building into having multiple branches some of which are international. Their clients range from individual and institutions to governments and other banks. Banks do not manufacture physical things. Their work is simply services for money (Koch & MacDonald 2010). Such services include storing, lending and managing money. All people and institutions, as well as governments, need money to operate accordingly.
The concept, function, and regulation of a physical currency whether coin or bill, falls under the control of the banks and government of the nation. In the case of Britain, several acts known collectively as the Grenville Acts became notorious for being a catalyst to the American Revolution. Searching for a form of prevention from use of valueless coinage for payment of debts, one act, known as the Currency Act of 1764, disallowed the minting of currency within the British colonies. (Selesky 293). Many problems arose, but in the short-term, a solution had been created to satisfy the needs of the empire temporarily as they progressed in terms of technology and geopolitical power. Along with the many decrees and orders of the government came the bankers, organizations of financially suited individuals who could very well be given the title for consolidating funds into an infrastructure for the whole of Europe! Prior to the 1800s banks privatized ownership and provided long-term loans and more, allowing for the grassroots of infrastructure to develop in Britain. Conveying the role of banks in infrastructure, Philip Cottrell mentions that “security issues [funds for projects] enabled infrastructure… in Europe starting in the 1830s and around the world in the 1850s” (COTTRELL 170). The arrival of a new era of technology and infrastructure in the 19th century brought also a need for financial security and management; aptly put
Bankers prior to the establishment of the Federal Reserve would establish lines of credit with larger banks. In the event of a run, the smaller bank would draw on the line of credit. In times of panic, large numbers of depositors would demand to withdraw their money, and only the largest Wall Street banks, with millions of dollars in reserve, could guard against this. In the early twentieth century, people were running to withdraw all their cash from their accounts, this may seem dramatic, almost theatrical to people today. Nevertheless, to people living in an economically unstable society, they were an expected occurrence. The banks were independent rivals, the amount of currency in circulation was fixed, and there was no element of
Now, let’s look back into history to see how this system developed. Goldsmiths were considered the first bankers because they started storing people’s gold in their vaults. The first paper money was only a receipt for gold left with the goldsmith. Paper money caught on because it was easier than lugging around heavy gold and silver coins. In time, the goldsmiths came to realize that only a handful of people ever came in to claim their gold at any given time, so they started cheating the system. They learned that they could print more money than they had gold and typically no one noticed. They could then loan out this extra money and collect interest on it. This was the birth of “Fractional Reserve Lending”, or FRL.
After the Constitution was enacted in 1789, the Bank of North America was chartered along with two state banks in Massachusetts and New York. Not surprisingly, following in the merchant traditions of previous years, the primary function of these banks and their followers was to make short term loans. They did this through the issuance of their own bank notes and/or by issuing a deposit account to the individual borrower and providing them with checks useful for withdrawl. Naturally, the issuance of bank notes was tantamount to the promise to pay specie to the bearer upon his demand. This meant that banks were responsible for keeping sufficient reserves to cover all demands. Maintaining sufficient reserves, however, was a very complicated task which ultimately forced many banks into bankruptcy because they had overexteded their loans and
However, the issue with Martin’s conclusion is that he fails to support his claim that money was truly accepted as credit among more than just a few. His evidence better defends the position that money has always operated like transferable credit. Martin does point to a few scholars that agreed with him, like Lowndes and Law, but these were revolutionary ideas and were either rejected or their plans failed miserably. By accidentally defending the position that money operates like credit so well, while neglected other major parts of his thesis, Martin undermines it and draws the reader’s attention in another
Early men’s didn’t need money. They found their own cloth, food, and shelter by what they could find in their environment and, that caused some issues because, people don’t always have what they want so, from here people started exchanging goods and that is called the barter system. After long time of using the useful barter system, money was invented so, people started using it instead of the barter system. When money was available a group of men appeared and they are called moneylenders and this led to the concept of creating banks. In the past, banks had two functions. The first function is to take deposits from people and keep it with them until they need them. The second function is to give loans to people. The economy won’t be able