What Is The Transformation Of The Finance Function?

Financial Management: “The process for and the analysis of making financial decisions in the business context.” (Cornett, Adair, & Nofsinger, 2016, p. 5).

The objective of this case is to understand the importance of crisis management. This case is intended to make the reader consider not only financial implications at the time of the event but the effects on the long term strategies of the organization. Also, the case urges participants to think about the consequences not only on the customer but on those within the organization as well.

The decision making of management is very crucial and involves various analysis to be performed. There are various ratios and methods that can be useful for mitigating the risks and increasing the expected returns with investments. The financial forecast is a mix of the behaviour,

A. Introduction B. Financial Crisis C. The Economic Environment D. Competition E. Changes F. Conclusion G. Exhibits H. Work Cited 3 5 8 9 10 12 13 15

The events of 9/11 further set back an already fragile economy (Figure 2). It heightened uncertainty, shaken confidence, and caused a widespread pullback from economic activity. Equity prices fell sharply for several weeks and credit risk spreads widened. The main focus of the Federal Reserve in the first few days following the attacks was to reinstate the infrastructure of financial markets and to provide massive quantities of liquidity to the functioning of those markets. The enhanced economic fallout from the events of 9/11 led the Federal Open Market Committee (FOMC) to cut the target federal funds rate through the end of the year. (Federal Reserve Board, 2002)

Prior to the terror attacks in 2001, the predominant thought processes for businesses in the private and local sectors was to continue generating money. By having this narrow-minded approach, these establishments were placing themselves in danger by not being prepared for a disaster, whether that would be man-made, weather or another type. According to Fisher (2004) in our attend section this week, after the 9/11/01 attacks, many businesses were left in dier need of assistance as they had not planned for such a catastrophe. There were several businesses that ended up going out of business. One in particular, lost its entire workforce in the attacks and had to start over, from nothing. Following the old adage that “hindsight is 20/20”,

On the 26th of November 2001, the National Bureau of Economic Research, declared that after ten years of economic expansion, the United States was in a recession as of March 2001 (Coplan 9). During the last quarter of 2001, the United States experienced a terrible tragedy; the 9/11 terrorist attack. However, economists believe that even if the terrorist attack had not taken place, the recession would have still been present, but it did in fact delay recovery. The recession of 2001 was by far different than all the other recessions. It was in fact, better than other recessions because the 2001 only lasted a quarter. Real GDP barley changed and the unemployment rates slightly rose (Nordhaus 2). It was found that banks have improved their performance during the recession, they were prepared for the worst this time around. During the 1990s, risk management became an important factor for banking discipline. Using risk managements, it gives the economy a potential to increase the stability. Thereby, banks benefited from an environment that rapidly declined short term interest rates, which enabled them to borrow at a lower cost (Schuermann 2). These risk managements played an important factor during the recession while impacting the United States economy in a positive manner.

People always think that the technology renovations, institutional changes and experience gains can make the world emerge from financial crisis saying that 'this time is different'. But they may be too optimistic. The outrageous truth is that each new financial crisis is not predicted or forestalled. As Reinhart and Rogoff said in their book 'This Time is Different', technology is changing, fashion is changing, but self-deception of governments and investors are not.

Just after ten years of Asian financial crisis, another major financial crisis now concern for all developed and some developing countries is “Global Financial Crisis 2008.” It is beginning with the bankruptcy of Lehman Brothers on Sunday, September 14, 2008 and spread like a flood. At first U.S banking sector fall in a great liquidity crisis and simultaneously around the world stock markets have fallen, large financial institutions have collapsed or been bought out, and governments in even the wealthiest nations have had to come up with rescue packages to bail out their financial systems. (Global issue)

Being in the midst of a global recession, American’s financial condition has been substantially weakened. Significant losses are adding up due to a weak demand for air travel and lower investment asset returns. There is a challenge to maintain sufficient liquidity and reduce debts during the global recession. Other risk factors and risk that American faces include disasters, accidents, and terrorist attacks. Due to its weakened financial condition, if any of these other risk factors occurred, American faces a large possibility of collapsing and filing for bankruptcy.

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The purpose of the review is to inform the reader about the possible dangers geopolitical risks might have on the financial industry when the industry does not look after them. I was intrigued by this dark side of modern communication and the effect it has on the safety of the banking sector.

The world is facing the worst financial disaster since the Great Depression. Millions all over the world have lost a countless number of jobs, seen cuts in their hours, wages, and benefits. In 2008, banks and financial institutions became bankrupt because of the unaffordable loans they lent out. Many lost their homes to foreclosures because of they could not pay off their loans. Those who invested in the stock market lost an abundant amount of money. The impact has been detrimental to Western Nations, but the financial disaster has had an effect globally. The global financial crisis has crucially affected the globe and slowed economies

The topic of Taylor's keynote speech is not an original one: he wants to know, share, and understand how the financial crisis in the first decade of the 21st century occurred. The method or approaching in tackling this issue is more original: he contends that some of the greatest factors influencing the onset of financial catastrophe is due to policies. At the heart of Taylor's argument is the presence of policies that created a sort of breeding ground for such a crisis to occur. The time period of his focus are the years 2000 2008.

According to the work examined in this study the global recession that occurred in 2008 and 2009 was partially a result of the financial industry's failure to be responsible for the decision it made in using financial instruments that were risk and very complex in nature. The culture of corporations were constructed on risk-based rewards instead of rewards that resulted in value for stakeholders. The financial risks that banks took on were not well comprehended by the public or regulators and the mass media also failed to understand the risks that the banks had entered into with certain financial agreements.