Abstract
This paper first explains that the cost of money is actually an opportunity cost, which a bank or another borrowing entity is willing to offer the investor in exchange for him not investing his money in other ventures, such as a business or the stock exchange through securities. Next, the author discusses this concept as the interest rate paid for a time deposit, which, at the same time, is the cost of credit that an investor is willing to undertake if he does decide to purchase securities or invest in a business. The paper also discusses the problems of risk.

From the Paper
"On the other hand, the simple investment of the money in a time deposit is almost cost- free: generally, most banks charge nothing when opening a deposit (they cannot, since this is their actual source of business and the way they acquire the funds they can use in their activity) and little or no sums when taking the money out of the deposit. The investment with time and money into opening the deposit is equal to zero as compared to the time and money allocated into starting an individual business."

Tags:alternatives, interest rate, starting costs, risks, time value of money

Abstract
This paper explains that, a decade after the enactment of the North American Free Trade Agreement (NAFTA) creating a borderless economy, Mexico has benefited from free trade but problems remain if it is to compete effectively with the rest of the world. The author points out that, the unemployment rate is close to zero in northern Mexico where manufacturing still is concentrated; however, manufacturing facilities are spreading out to other parts of the country. The paper stresses that, in spite of the vast improvements in the last ten years, Mexico still has some serious challenges ahead such as (1) the need to create one million new jobs each year in order to absorb the young workers entering the market and (2) smaller companies have trouble upgrading technology because of higher borrowing costs.

From the Paper
"Mexico has come a long way from the catastrophic financial crisis of 1994-1995, when millions of Mexicans were thrust into poverty and life savings were wiped out. Two million jobs were eliminated. The early days of NAFTA had failed to benefit Mexico as expected, and most of the manufacturing exports still came from the maquiladora sector along the northern border with the U.S. A corrupt and unstable political environment limited foreign investment. In January 1995, President Clinton was motivated to provide a $47 billion bailout of the Mexican economy."

Tags:maquiladora, northern, employment, investment, borrowing-costs

Abstract
This paper explains that no aspect of the U.S. economy has remained unchanged during any given war. The author points out that the current Iraq war has positioned itself to possibly be the longest in U.S. history and hence the most expensive. The paper relates that, with more than 1 million U.S. troops in Iraq, the cost of long-term medical care and disability benefits will continue for years after the war. The paper underscores that post-war occupation and reconstruction, an inevitable factor in this conflict adds an even higher cost to the war. The author concludes that, in addition to direct costs, the Iraq war is destabilizing the economy by causing increasing oil prices, uncertainty in the credit market, inflation created by a greater demand of economic goods and services, and an increasing need to pay for the war with borrowed dollars.

From the Paper
"With the increased costs of war comes a hefty interest payment on the national deficit. Joint Economic Committee (JEC) Chairman Sen. Charles E. Schumer, JEC Vice-Chair Rep. Carolyn Maloney , released a new report exposing the hidden costs of the war in Iraq. The Joint Economic Committee report entitled, "War at Any Price? The Total Economic Costs of the War" details the high hidden economic costs of the war in Iraq beyond the direct budgetary appropriations, including interest costs of borrowing these funds, lost investment, long term veteran's health care, and oil market disruptions."

Tags:world war ii, vietnam war, subprime oil uncertainty

Abstract
This paper explains that the introduction and implementation of the euro has done much to integrate the national financial markets, leading to higher efficiency in the allocation of capital in Europe, with EMU members benefiting from an increase in intra-European trade flows and higher capital investment resulting from the development of a single currency. The author points out that a single currency is now an important complement to the Single European Market, which is quickly making the European Union a more powerful player in the global economy. The paper stresses that the single unit of account reduces transaction costs and eliminates a portion of the fixed costs involved in issuing similar securities in multiple currencies, serving to moderate home bias in borrowing and lending, and leading to larger, more-liquid, and more-diversified financial markets.

Table of Contents
Introduction
Objectives
Appropriateness of Analysis
Methodology
Literature Review
Aims of the Euro
How the Euro Has Affected Finland
The Euro and the UK
Discussion and Analysis
The Domestic Dimension
The Regional Dimension
The Global Dimension
Conclusion

From the Paper
"The common currency will ultimately speed up the integration of the EU countries. With a single currency, a single monetary and interest policy, the countries in the euro zone are more dependent on one another than they ever were. The single currency is slated to become an outward sign of European identity. Thus, national economic policies must remain sufficiently flexible to react to different situations. However, better coordination is necessary to avoid future problems. Europe's increasing power in monetary and financial questions will for also have positive effects on the EU's scope for foreign policy action. A Europe with fewer internal borders and in which people use the same currency from will have a new quality quite different from the Europe of the past."

Tags:market, integrate, trade, union, securities

Abstract
The Future of Project Finance

After taking a battering from spectacular failures due to the Asian economic crisis impact on emerging nations and markets worldwide, project finance is making a cautious, conservative rebound. Private and institutional investors are taking an increasing part in financing domestic and international major infrastructure, power and utility projects through innovative funding structures.

From the paper:
"Limited recourse loans are a well-defined form of borrowing; any transaction that does not include elements unique to this structure does not strictly qualify as project finance. Limited recourse loans were invented in the late 1920s and early 1930s to provide US wildcatters with longer-term production finance. During the 1930s, drilling became deeper and resultant cost higher; more extended financing terms were needed. The improved engineering techniques of the early 1940s provided the ability to forecast the future recovery of oil reserves, and some banks applied these new techniques to justify production loans in excess of the three years' limited term previously applied. Since the project itself was deemed able to support a level of production that would provide for repayment from the project's cash flow, the creditworthiness of the borrower was irrelevant."

Tags:finance, loans

Abstract
The paper explains that, in 1913, the Federal Reserve System, an integral part of the United States economy, was created by the Federal Reserve Act to deter the periods of financial panics, which were occurring in the United States. The author points out that managing the nation's monetary policy is the most important responsibility of the Board of Governors. The Board has three tools to conduct monetary policy: open market operations, reserve requirements, and the discount rate. The paper relates that the increase in the federal funds rate is the Federal Reserve's way of controlling inflation because, by raising the cost of borrowing money when there is too much money in circulation, the Federal Reserve's intention is to slow the economy down.

Table of Contents
Introduction
History
The Federal Reserve Board
Responsibilities of the Federal Reserve Board
The Fed and the United States Economy Today
Conclusion

From the Paper
"The Federal Reserve Board was established as a federal government agency and is the governing element of the Federal Reserve System. The Federal Reserve Board, or the "Board of Governors," is made up of seven members who are appointed by the President and confirmed by the Senate. Once confirmed by the Senate, the length of a term for a Board member is four-teen years. No Board member may be reappointed to the board. Every four years a new Chairman and Vice Chairman are also appointed by the President and confirmed by the Senate."

Tags:act, management, market, reserve, discount

Abstract
This paper explains that the euro has served as the greatest economic policy experiment, uniting several large countries and facilitating greater competition, trade and financial stability. The paper points out that the euro spawned a new era of competition for Eurozone businesses, radically reducing transaction costs, creating a broader pool of savings with a diversified set of options for borrowers and increasing competition between legal environments. The paper also reports that the implications from increased international trade due to the euro include the elimination of deadweight loss and a gain to consumers. The paper concludes that the euro will continue to play a critical part as the Information Age continues to mold previously segmented economies into one thriving global economy.

Table of Contents:
The Globe
Unprecedented Competition
Trade Amplification
Financial Stability
Conclusion

From the Paper
"It is intuitive that sharing a common currency increases trade between a pair of countries, but the major question is why. Rose simply admits that he does not know. He speculates that a common currency might mean greater political commitment to a long-term economic integration or perhaps greater financial integration between two countries. While the reason behind this is still a puzzle, it nevertheless has many implications for both the EMU and the increasingly global economy."

Tags:competition eurozone, gravity model, internet integrating

Abstract
This paper explains that, in the 1980s financial crisis, the Latin American countries especially Mexico could no longer repay their foreign debts, which was caused by excessive and continuous borrowings even at a negative interest rates and the rising cost of commodities and a global recession that was aggravated by the Organization of Petroleum Exporting Countries (OPEC) oil crisis. Next, the author examines the measures instituted to arrest the collapse, such as the Baker plan, the Brady plan and the International Monetary Fund (IMF) and World Bank (WB). The paper relates how the recent financial crisis is linked to this 1980 financial crisis.

Table of Contents:
Introduction: The 1980's Crisis
Background
The Oil Crisis
The Effect of the Oil Crisis
The Debt Burden
The Financial Crisis
The Role of the Fed in the Crisis
August 1982
The Foreign Commerical Banks
The IMF-WB Conditions
The Baker Plan
The Brady Plan
Conclusion

From the Paper
"Latin American countries particularly Mexico are already feeling the brunt of these combined economic setbacks. The global economic slowdown diminished the demand of their exports thus decreasing their capacity to pay their loans. More importantly, the interest payments on their loans rose dramatically due to the increased interest rate imposed by the Fed to arrest the inflation. This measure took a toll on the economies of Latin American countries because of their heavy dependence on external loans.
"In August of 1982, Mexico, through its Finance Minister, Jesus Lava Hertzog declared that it cannot bear the crisis anymore and declared that it cannot pay its debt and asked for a 90 days moratorium. When he made this announcement, Mexico's debt already exceeded $80 billion and "almost 30 percent of this debt was due within one yea. He also requested a new loan to repay its existing loans and renegotiated for the due dates of their loans. This declaration of default on loans by Mexico precipitated a global financial crisis as other countries which has the same balance of payments problem like Mexico also declared its inability to pay its loan. Instead of a moratorium, Mexico's loans became immediately due."

Tags:borrowings industrialization, federal reserve, market orientation, insolvency

Abstract
This paper provides a case study of General Motors' relationship with Cerberus Management. The paper describes a problem facing GM; its finance company, General Motors Acceptance Corporation (GMAC), which is 51% owned by Cerberus, is tightening its extension of credit to consumers to bolster the long-term interests of Cerberus and is thus acting against the desires of GM. The paper explains that the financial insolvency of consumers has forced many individuals to default on their automotive loans, making banks wary of extending lines of credit to all but the least risky of borrowers. In an industry that is uniquely dependant on lines of credit, as consumers usually do not have the ability to buy cars with cash 'up front,' this presents a substantial threat. The paper concludes that if it does acquire Chrysler and sheds GMAC's real estate-related debt, GM must engage in a rigorous program of cost-cutting and consolidation of both its operations and Chrysler, and be willing to weather a more painful period of cutbacks and layoffs than it has experienced before.

From the Paper
"Conventional wisdom holds that mergers are a bad idea. In fact, a common business adage is that if you predict that a merger is likely to 'go south' without even looking at the financial statements of either companies, you prognostication is likely to be correct. Merging two failing companies with similar problems outdated models and underperforming factories would seem to be a recipe for disaster, but GM may have to do so simply to keep lines of credit flowing between itself and GMAC. Desperate times call for desperate measures and GM is desperate. However, if it does acquire Chrysler and sheds GMAC's real estate-related debt, GM must engage in a rigorous program of cost-cutting and consolidation of both its operations and Chrysler, and be willing to weather an even more painful period of cutbacks and layoffs than it has experienced before."

Tags:automobile, industry, credit, finance, Chrysler, debt, GMAC

Abstract
This paper explains that a building society is a Financial Institution that is owned by all its members rather than by its shareholders which plays the role of paying interests on the deposits made by the members and also of lending money to its members by proposing to keep the property as security in order to enable them to buy a house of their own. The paper then details the history of the Abbey National Building Society from its beginnings in 1944 to the present day as well as what Abbey National Building Society has had to do to remain successful.

From the Paper
"The market conditions at the time were very strict and regulated, and there was stiff competition everywhere. The 1986 occurrence of the 'Big Bang' served to break down all the traditional barriers that a person would expect in a Bank, and soon banks and other financial institutions became more capable of offering a wide range of financial services that hitherto had not been done. Abbey Building Society had at this time already demonstrated its free and independent thinking by breaking away from the Cartel of building societies that had insisted on certain fixed basic mortgage rates for everyone. Therefore when the decision to convert into a plc was taken in 1989, and after the conversion had actually taken place, there was a dramatic increase in the number of shareholders in the United Kingdom: the numbers rose from 6 million to 9.5 million, a 50% increase. (Conversion to plc, the Background)"

Tags:financial, services, lower, cost, borrow, money, borrowers, savers, bank, conversion