A CRISIS OF ETHICS and MANAGEMENT BY Eion Maison

Managing risk is the renewed task of management in the financial industry. The austere regulation of the financial industry seem to be the norm for small and medium financial corporations, while for big investors and with financial businesses there seems to be a laxity in supervision – perhaps because these large firms can afford to hire specialist of all sorts and experiences, they are expected to police themselves.
It is true that a systematic approach to enterprise risk management can produce business benefits which extend far beyond compliance, but the lack of ethics on the part of management only serves to expose the institutions and the investors to more than risk. Therefore, crisis of ethics in management is bad for the financial firm and worst for the industry.

Matrix of Global Financial Crises by Eion Maison

The Global Financial Crisis is all that we hear about lately. It is the concern of all of society, especially for academics. Business schools will now have to use dynamic financial analyses and real world variables in some new equations.

Before we consider all of the dynamic approaches and very best practices, let us look at what is happening around the globe. Please find below a summary of the results of the Global fallout by country.
My intention is to develop a matrix to show what we can learn from this phenomenon. But here is a summary in selected countries of the FALLOUT, EFFECT AND GOVERNMENT OR COPORATE ACTION.

Anguilla: Treasury Bill and Development Bonds Bill passed in the House of Assembly on February 18. Bills will be sold via Eastern Caribbean Stock Exchange. The hopeful result being more liquidity.

Antigua / Caribbean: (Including Antilles)Stanford Bank fraudulently selling $8 billion in high yield certificate of deposits. Many wealthy individuals, companies and investors deposited upward of US $100,000 each. ECCB tries to prevent a run on the local bank and reveals tight monitoring by itself and the Government of Antiguan and Barbuda. ECCB has taken control of the bank.

Russia: Global slowdown fuelling social unrest.Dented faith in the Kremlin’s economic stewardship. Resulted form sharp fall in oil prices. The problem led to liquidity crunch resulting in heavily indebted companies. Under performing officials fired.

St. Maarten: Diamond Resort closes sales office. Sisteen (16) workers severed. Company offered severance package. Government's Social Economic Initiatives (SEI) provide money of emergency marketing: Seven million guilders can be diverted or reallocated to give the first thrust to a comprehensive emergency marketing stimulus package. An estimated US $4.1 million is needed to intensify efforts to bring more tourists here.
Also, local insurance company NAGICO launches A-Team, based on sports model, to strive for excellence in performance.

Trinidad and Tobago: CL Financial Crisis - TT $10 billion statuary reserve deficit. Melt down of its financial services and subsidiaries. 51 staff altogether terminated. CL Investment Bank deposits and liability has been taken over by State Bank First Citizens and a new Board of Directors installed.

The world will be looking with interest at the various (positive) outcomes of the crises that face all economies and the resulting strategiesemployed by corporations, government, trade unions, commerce and tourism associations and all other stakeholders.

I plan to keep my students, subscribers, readers and all of blogosphere aware of how we are affected and what we can do in the situation. Much later in the series fucuss will be directed to the policy level of analysis.

Caribbean Stimulus Package by Eion Maison

There are many articles written by esteemed economists and columnist appearing frequently about the current financial crisis that hit the United States with rippling and perhaps crippling effects around the world, and in particuar the Caribbean.

As I read these articles I am thinking that it is about time that Caribbean Governments viz-a-viz Caricom come up with a regional solution that somewhat resembles a stimulus package.
Individually, Antigua and Barbuda has decided to establish an Unemployment Benefit Fund (UBF) to help those who have been laid off as a result of the global financial crisis.

I know that the rebuttal could be that governments are not financially able to make such a commitment, for all the right reasons; but bear me out on this. On the micro side of my own budget constraints, my mantra is that if it is budgeted it will most likely get done. The same, I think, citeris paribus, applies to the macro side.
This may sound as if I am recommending Welfare Capitalism. Well, maybe it is worth looking into. After all, Gustav Schmoller and other early economist may have seen this far into the future