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What is Financial Regulation ?

Financial regulations are a form of regulation or supervision, which subjects financial institutions to certain requirements, restrictions and guidelines, aiming to maintain the integrity of the financial system. This may be handled by either a government or non-government organization.

Roles and Goals of Regulation:

1. To enforce applicable laws
2. To prosecute cases of market misconduct, such as insider trading
3. To license providers of financial services
4. To protect clients, and investigate complaints
5. To maintain confidence in the financial system

Source: Wikipedia

Obama's Financial Regulatory Reform:
Obama has proposed a Financial Regulatory Reform which address five key objectives;

1. Promote robust supervision and regulation of financial firms.
   
   
   • Financial institutions which are critical in keeping the market stable should be subject to strong supervision and regulations.
   • New powers are given to the Federal Reserve to supervise all the firms that could pose a threat to financial stability, including those which are not banks.
   • To improve inter-agency cooperation and to identify financial risks, a new council will be formed, called Financial Services Oversight Council.
2. Establish comprehensive supervision of financial markets.


• Additional power to Federal Reserve to oversee payment, clearance and settlement systems of financial systems
• Comprehensive regulation of all over-the-counter derivatives by the Federal Reserve (A type of financial derivative that has its transaction directly negotiated between two parties rather than through an exchange. Some financial derivatives, such as a swap, a forward rate agreement or an exotic option, are usually done over the counter.)
• New requirements for market transparencies, stronger regulation of credit rating agencies.
  
3. Protect consumers and investors from financial abuse.


• A Consumer Financial Protection Agency will be established to protect consumers across the financial sector from unfair, deceptive and abusive practices.
• Improving the standards of the providers of consumer financial products and services, whether they are a part of a bank or otherwise.
  
4. Provide the government with the tools it needs to manage financial crises.


• Issues of non-bank financial institutions, whose failure could have serious impacts on the market, to be resolved by an overseeing authority (Federal Reserve)
• Revisions to the Federal Reserve's emergency lending authority to improve accountability.
  
5. Raise international regulatory standards and improve international cooperation.


• International reforms to strengthen the capital framework; improving oversight of global financial markets; coordinating supervision of internationally active firms; and enhancing crisis management tools.
  

As one can notice in the above propositions, that more power has been vested in The Federal Reserve to monitor, control and supervise financial and non-bank institutions.

What will be pros and cons of such a reform and how will such a reform have global impact?

What are the macro effects on the Gulf and how will an individual global citizen affected by such a reform?

To more on the above questions, stay tuned to watch more updates.

The new marriage law providing for pre-marriage checkup will be in force on Sunday, August 2, 2009, Assistant Undersecretary of Kuwaiti Ministry of Health for Medical Services, Dr. Yousuf Al-Nesf announced Wednesday.

Why?

"The aim of the legislation is to ensure a healthy and happy family and eradicate the hereditary and communicable diseases in Kuwait", said Dr. Yousef Al-Nesf during the announcement.

Meanwhile, Abdullah Al-Hamoud, supervisor of family affairs at the Justice Ministry, said if the results of the lab tests proved that the would-be marriage is unsafe due to the illness of one or both of the partners, the marriage contract would be cancelled.

"A marriage officer is authorized to solemnize a marriage only after receiving a certificate that verifies that the couple conducted a checkup and were physically fit," Al-Hamoud reminded.

The survival of the fittest or is it catalyzing the process of being the fittest ?

Do we need to accelerate the nature's process by adopting such rules?

Are we morally justified ?

We all understand that money can be a powerful motivation.

Most of us don't realize it, until we starting making some money by ourselves at regular intervals of time.

Students can be enterprising, independent and smart.
The question is how ?

They can do a lot of multi-tasking with their studies, researching into unknown territories, coordinating events, excelling at extra-curricular activities and so on.

Well that gets one, some good experience, dedication, time management skills, and people management.

However, students may be "Independent" financially.
Not because they are deprived of finances, but because it helps them understand the principles of generating money by their ideas.

How to convert an idea into a money making machine... ?

The product/service which probably may qualify to be a successful startup has certain characteristics such as:

1. It caters to a specific need of a larger community or immediate smaller group
2. It is easily accessible by different means (consider online access and never forget the traditional way)
3. The demand for it is perpetual (lasting an indefinitely long time). It need not have to be in super high demand. It needs to be asked daily. E.g. Bread.
4. It does not require a lot of investment at the beginning
5. Can be coupled with other existing products/services (especially useful while starting, e.g. you can bundle your product or service with some other product/service. e.g. Think DELL and Microsoft)
6. It can be started in a garage or in the basement. (no huge real estate requirements)
7. Can be started with a single individual or two. Two is preferred.
8. It can be described easily to an average individual
9. Takes less time to monitor by the business owner (Spending an hour or two at the beginning should be suffice. Remember your primary objective is still to succeed at studies)
10. Should be able to diversify
11. Being aware of financial lessons which are not taught in classrooms, but gained by experience is a HUGE advantage when one graduates.

The idea here is not to make ONLY money, however in a long run, be able to learn how to shape an economy.

Once one masters certain principles of making money, money just keeps flowing.
Keep the input and output flow of money at almost the same rate.

Keep the money always flowing, never keep it static.
Otherwise one runs a big risk of not making more or even losing it.

It was a fine, sunny Sunday morning, my brother and I wanted to buy something online for our nephew. I quickly pulled out my Internet Card and inputted the details and, to our surprise, the transaction got rejected.

So we dialed the call center number of a major bank in Kuwait, and the customer service agent informed us that my card is blocked since I delayed the payment. I authorized the payment after 15th, (which happens to be the due date), and the transaction shows up on my Internet Card statement; I have sufficient credit to make a purchase.

The agent calmly responded that I needed to visit my branch to unblock my card.

I simply asked him, "Isn't it not logical to a banking system, to just unblock a card when the transaction is done, qualifying it to be valid again for use?"

The agent cordially repeats again, "Please visit your branch Sir"?

I made a quick visit to my branch (Yes, you have to visit THE branch where you opened your account! Sadly my office is in The City and my branch quite far away).

After explaining the issue to the Customer Care Representative at the branch, she replies, "we have to send an email to the head quarters to get your card unblocked and it may take 24 - 48 hours for that."

Now, this is a minor instance where the banking software itself can check to ascertain whether the card is blocked - when a valid transaction is done, and unblock it if the transaction succeeds. This only shows how inconvenient the customer experience can become due to a minor issue of information technology. At the very least, the major banks in Kuwait need to review their IT and software benchmarks based on surveys and general feedback by customers. The idea here is that a very minor feature, when under-estimated, can cause a much inconvenience to a large customer base, not just the incident mentioned above, but other issues related to banking transactions, that ultimately taint customer service satisfaction.

The Global Recession in on everyone's mind in one way or the other; not many know, however what sparked it and how it is controlled. Let's go back to the roots of the problem to understand how a debt is created and how it affects millions of lives around the globe.

There are five parts to the video below (from the excellent documentary Zeitgeist: The Movie) which, at the very least, offer a broad analysis of the subject.

Part II.

Part III.

Part IV.

Part V.

For more information on Economic Recession, please visit Recession.org

The Money Masters and Money as Debt also provide similar information as Zeitgeist