Mooon

A Closer Look at High-Frequency Trading

Once, stocks were traded through the open outcry system. Today fast, interconnected computers have mostly replaced the traders shouting prices on the floors of stock exchanges. Joe Saluzzi is a head of equity trading at Themis Trading in New Jersey. “The equity market has changed. It’s no longer what you see on TV, it’s no longer guys with colored jackets running around the floor anymore. The equity market is a bunch of co-located computers strung together by a bunch of wires, everyone trying to race to zero. The speed of light is the goal.” Computers can process stock trades in thousandths of a second. Andrew Haines of Gain Capital is an online broker. “A millisecond can mean millions of dollars to the success of your strategy. Having a one, two, three millisecond advantage over other traders may mean that you get into a trade at a preferable price.” Andrew Haines says an estimated seventy percent of all stock trades are high-frequency trades made with complex computer models. Stocks may be held for only seconds. But fast trades are also blamed for big moves in stock prices. On May sixth, two thousand ten, a leading measure of American stocks briefly fell about nine percent. The Dow Jones Industrial Average then recovered much of those losses by the end of trading that day. The Securities and Exchange Commission ordered steps to prevent future “flash crashes” like that one. Joel Hasbrouck of New York University says those steps are working. “They’re called circuit-breakers, and basically what they mean is that when a stock has moved by a large amount in a short period of time, there’s a trading halt.” Joe Saluzzi of Themis Trading says the main problem with high-speed trading is an unbalanced market. “The stock market used to be a predictor of the future economy. Now I think the stock market is a backwards predictor. It’s forecasting the next microsecond move. It’s not forecasting the next six months, because most of the volume is being dominated by guys who could care less what goes on in six months. So, how could you think the price is being set correctly?” But Joel Hasbrouck says high-speed trading can reduce sharp rises or drops in stock prices. “In normal circumstances, high-frequency traders act as market-makers. That means they stand by passively waiting to buy or sell from whoever comes into the market needing to trade. In that capacity, they actually help stabilize the market.”

Reassessing the Impacts of Brain Drain on Developing Countries

Brain drain, which is the action of having highly skilled and educated people leaving their country to work abroad, has become one of the developing countries concern. Brain drain is also referred to as human capital flight. More and more third world science and technology educated people are heading for more prosperous countries seeking higher wages and better working conditions. This has of course serious consequences on the sending countries.

While many people believe that immigration is a personal choice that must be understood and respected, others look at the phenomenon from a different perspective. What makes those educated people leave their countries should be seriously considered and a distinction between push and pull factors must be made. The push factors include low wages and lack of satisfactory working and living conditions. Social unrest, political conflicts and wars may also be determining causes. The pull factors, however, include intellectual freedom and substantial funds for research.

Brain drain has negative impact on the sending countries economic prospects and competitiveness. It reduces the number of dynamic and creative people who can contribute to the development of their country. Likewise, with more entrepreneurs taking their investments abroad, developing countries are missing an opportunity of wealth creation. This has also negative consequences on tax revenue and employment.

Most of the measures taken so far have not had any success in alleviating the effects of brain drain. A more global view must take into consideration the provision of adequate working and living conditions in the sending countries. Another option should involve encouraging the expatriates to contribute their skill to the development of their countries without necessarily physically relocating.

Ramadan

Ramadan is the ninth month of the Islamic calendar. It is the Islamic month of fasting, in which participating Muslims refrain from eating, drinking from dawn until sunset. Ramadan had been the name of the ninth month in Arabian culture long before the arrival of Islam. In the Qur’an it is said that “fasting has been written down (as obligatory) upon you, as it was upon those before you” which is a reference to the Jewish practice of fasting on Yom Kippur. Fasting is meant to teach the Muslim patience, modesty and spirituality.

Ramadan is a time for Muslims to fast for the sake of God and to offer more prayer than usual. During Ramadan, Muslims ask forgiveness for past sins, pray for guidance and help in refraining from everyday evils, and try to purify themselves through self-restraint and good deeds.

As compared to the solar calendar, the dates of Ramadan vary, moving backwards about ten days each year as it is a moving holiday depending on the moon. Ramadan was the month in which the first verses of the Qur’an were said to be revealed to the Islamic Prophet Muhammad. That was during a night that Muslims call Laylat al-Qadr (the night of decree.) The night is believed to be one of the 10 last days of the month.

A stereotype is a fixed idea that people have about what specific social groups or individuals are like, especially an idea that is wrong. Other terms that are associated with the term stereotype are prejudice and cliché. The term has a Greek origin: stereos means solid or firm and typos mean impression, engraved or mark. The term was first used in the printing business. The first modern English use of the term was in 1850, meaning “image perpetuated without change.”

Because stereotypes are standardized and simplified ideas of groups, based on some prejudices, they are not derived from objective facts, but rather subjective and often unverifiable ideas. As Sociologist Charles E. Hurst states “One reason for stereotypes is the lack of personal, concrete familiarity that individuals have with persons in other racial or ethnic groups.”

The existence of stereotypes may be explained by the need of groups of people to view themselves as more normal or more superior than other groups. Consequently, stereotypes may be used to justify ill-founded prejudices or ignorance and prevent people of stereotyped groups from entering or succeeding in various activities or fields. The stereotyping groups are, generally, reluctant to reconsider their attitudes and behavior towards stereotyped group.

Stereotypes may affect people negatively. This includes forming inaccurate and distorted images and opinions of people. Stereotypes may also be used for scapegoating or for making general erroneous judgments about people. Some stereotyping people may feel comfortable when they prevent themselves from emotional identification with the stereotyped group, which leads to xenophobic or racist behavior. Finally another serious consequence of stereotypes is the feeling of inferiority that the stereotyped people may have and which may impair their performance.