The European sovereign debt crisis Assignment Example | Topics and Well Written Essays - 2000 words

The European sovereign debt crisis - Assignment Example Consequently, the euro debt crisis is crucial as one intends to study its spillover effects. This is because the crisis was characterized by decisions and events at a political level (Acharya and Steffen, 2012, p. 12). In this case, the Euro debt crisis will be viewed as a financial phenomenon that affected the European region. Historical events associated with the Euro sovereign debt crisis will investigate the negative watches and downgrades on European governments, financial markets, stock, and bond markets. The Euro sovereign debt crisis reached its peak in March 2012 after Greece conducted the largest sovereign debt restructuring. Countries such as Spain, Ireland, Italy and Portugal were also facing serious financial crisis. It is essential to note that all member states of the European Monetary Union provided loan guarantees. As a result, the creditworthiness of the region was at stake (Ahearne, Griever and Warnock, 2004, p. 316). The effect of this event was that all member st ates of the Euro, even states that had sound public finances, were subjected to downgrades or placed on negative watches by global rating agencies. Some of the countries lost their investment grade statuses. This is an alarming signal for international investors. Before, the first country was downgraded, speculation against the EURO was attracted and the stock markets turned down. As a result, some countries began losing their access to capital markets. European Union politicians devised a plan to accuse credit rating agencies, which worsened the crisis (Andrade and Chhaochharia, 2010, p. 2431). Changes in funding conditions used by banks are important in the assessment of financial intermediaries. These intermediaries supply credit to the economy. Since 2009, the remuneration on deposits in core European Union countries remained unchanged. However, there were large dispersions compared to the period prior to the crisis. The costs of the deposits increased significantly in several p eripheral countries (Angeloni and Wolff, 2012, p. 19). This reflected the difficulties that banks were experiencing as they tried to obtain funds through market sources. In 2012, these rates decreased owing to the improvements in market confidence that triggered the cut in ECD interest rates. Funding difficulties experienced by peripheral countries adversely affected the financial conditions, non-financial corporations and households. For instance, the charge of short-term loans to a non-financial corporation augmented unexpectedly in peripheral countries, in 2011. In countries such as Portugal and Greece, the interest rates neared the levels of 2008 (Arezki, Candelon and Sy, 2011, p. 9). Reactions of the European Money Markets The sovereign debt crisis sent ripples all over the international banking systems. This prompted interventions by central banks and governments on a scale that is comparable to the programs instituted during the 2008 financial crisis. European authorities ple dged financial support to the tune of 1 trillion EURO. This support was meant for the recapitalization of the challenged Euro area countries (Arteta and Hale, 2008, p. 59). The European Central Bank injected an exceptional amount of liquidity in order to mitigate the effects of the banking system balance sheet disclosure especially the deteriorating sovereign debt. European banks hold huge amounts of debt securities in government. They hold these debts as securities because the Capital

Role of Human Resources in Managing Change Essay

Role of Human Resources in Managing Change - Essay Example Regulations by the government are another major cause of organizational change. When the government imposes new regulations, it may have an impact on the operations of a company. For example, the government could enforce new procedures for safety in factories, forcing the organization to modify their process of production to comply with the new regulations (Change Management Learning Centre 1996). Another example of a regulation that may warrant transformation is if the government mandates organizations dealing in consumer goods to enforce more measures for quality control of the consumers’ safety. These changes warrant a transformation in the modes of operation in the organization. Another cause of revolution in the organization is increased competition. New entrants into the market could, for example, create an influx of competition, causing pre-existing organizations to implement change in their marketing strategies (Kim & Hong 2006). An example of this is when, say a big r etail store opens in an area where a small one has existed primarily over a long period; the small store could change their marketing strategies. This, the store owners have to do in a way that increases the appeal to customers over the newly opened store. The final cause of change is the desire of an organization to grow. Stagnation is a cause of concern in any business or company, and could be detrimental to any positive progress by the company. Therefore, organizations that wish to grow have to change their operation tactics (Change Management Learning Centre 1996; Steir 1999). One of the ways in which this is achieved is through franchising the organization operations to...This paper discusses the role of human resources in organizational change. The discussion will look at the possible catalysts for change in the organization, resistance to the change from within the organization, and finally the part that the HR plays in the implementation of changes. The world today has creat ed a situation whereby, the systems that govern the operations of organizations are constantly changing. As productivity increases, there has been an evolution in the world of technology, sometimes creating the need for organizations to adjust and adopt the use of certain kinds of technology to avoid lagging behind. With a constantly evolving society and fluctuating demand for products and services, whether new or pre-existing, it is mandatory that organizations change their mode of operation if they are to remain competitive. It is survival for the fittest, as the organizations that remain most dynamic and receptive to change are the ones that continue to flourish in the market. Several factors may lead to a situation where the business re-evaluates its dealings. The first factor that acts as a catalyst for change in the organization is the change in, or introduction of, new and efficient technology. As productivity increases, there has been an evolution in the world of technology, sometimes creating the need for organizations to adjust and adopt the use of certain kinds of technology to avoid lagging behind. The process of change occurs in several manageable stages, in which incorporating the HR save the top management great deals of confusion and resistance.