paper 2

Interview two people about money.

Whose picture is on a twenty?
1) Andrew Jackson
2) Andrew Jackson

Ask them why they ‘believe’ in money?
1) Everything would be free without it
2) I believe in money because it is the means to provide for oneself in modern civilization.

Do they imagine a time in which people might not believe in money?
1) No, I can imagine a time in which people stop believing in cash, but not money
2) No

Why is money important?
1) Because we live in a world that thrives on it
2) Money is important be cause it is a stable way of trading a valued note for goods and services.

Can money be something more than notes of currency?
1) Yes they can
2) Yes, money can be something more than notes of currency as long as that something is widely accepted and stable.

Would you believe in money that isn’t a dollar or coin?
1) I wouldn’t because I grew up in a country that uses dollars and coins so that is all I know
2) Yes


Write a page describing the results of your survey











July 11, 2011



Both people knew the correct answer to who was on the 20-dollar bill. I wasn’t too shocked by this because a 20 is the most common bill you see. Even though most people don’t carry cash anymore, when we do go to the ATM to get money it comes in increments of 20. I think that if the question would have been who is on a 50 or 100 the answers may have been off, but there are plenty of references in pop culture that may trigger someone to remember who is on those bills even if they rarely carry them.
The first respondent believed in money because “everything would be free without it.” I think this respondent may have been looking at money narrowly, as only the currency that we use today. Even if we didn’t believe in money the exchange of food would still occur and it would not be free. The second respondent believed in money as means surviving in the modern world. It is true that you use money in exchange for the necessities of life. In a time where civilization has developed beyond subsistence farming we now need money to purchase everyday good for living.
Both believed that money would always exist. One specified that cash may not be around but money will always exist. I agree with that. Money is more than a tangible thing and possesses a metaphysical quality. You will always have exchange and trade and whatever is used will constitute as money.
Both found that money is important because we need it to get by. One response was that the world thrives on it and the other was that it is needed as an accepted way to conduct exchange of goods and services.
They both agreed that money could be something besides notes of currency. I asked this to see if the respondents would recognize that money is more than dollars or coin. The next question piggy backed on the last and asked if they would believe in money that is not currency or coin. The second respondent who felt that as long as something was widely accepted and stable it could be used as money agreed that he would believe in money that wasn’t dollar or coin. The first respondent felt that growing up in a country where paper and coin are used it would be unlikely to accept another form of money. Again, I feel you must looked beyond money as coins and accept it as a value of trade or exchange. This could be anything so long as everyone accepts it.

PAPER 1

July 7, 2011

GOVT 490 Paper #1

The 2009 mortgage crisis resulted in a number of mortgages being delinquent or foreclosed. Most Americans purchase their homes with mortgages. With an economy in recession and a mortgage crisis media coverage shifted towards topics that are unfamiliar with most. Bank jargon and federal acronyms appeared in the mainstream media outlets that leave many pondering what it all means. To be fully aware of the crisis and the steps taken to address the issue a familiarity with the elements of the crisis is needed.

Financial institutions grants mortgages with the intent on collecting the loan back with interest thus making a profit. With a drop in market value mortgages became more expensive than the properties themselves. When a large number of people foreclosed or went delinquent the banks found themselves having property that wasn’t worth what they paid for. To address this problem and to keep the financial institutions from going under the federal government created TARP (trouble asset relief program). This program allowed the government to purchase troubled assets, allowing banks to stay afloat.

Adjustable rate mortgages are mortgages that have an interest rate that is adjusted periodically based on the market. This takes the risk from the lender onto the borrower. Banks are able to start with a low initial interest rate and then raise it. It relates to the mortgage crisis because borrowers were short minded and took advantage of low rates but then when the market dropped they were paying high interest rates.

Subprime mortgages are high interest mortgages that are issued to those with poor credit. They are related to the mortgage crisis because the borrowers were also given adjustable mortgages and when the bubble burst many were not able to pay and were foreclosed.

Investment banks are banks that are involved in the buying and selling of securities. In the crisis many the banks shortsightedness was revealed and they had to receive TARP funds to keep afloat.

CDOs are a tool that collects loans and sells it off. It gives banks the ability to sell of its debt to outside investors. As the debt moved from the initial lender regulation grew scarce.

Credit Default Swaps are insurance for the lender in case of default loans. The CDS is purchased from an insurance agent and if the loan defaults the lender will receive cash from insurance.