What have we learnt from Introduction to Management Information Systems?
This course is an introduction to information systems and information technology for students who are or who will soon become business professionals in the fast changing business world of today. We have been given an opportunity to learn how to use and manage information technologies to revitalize business processes, improve business decision making, and gain competitive advantage. There is a major emphasis on the essential role of Internet technologies in providing a platform for business, commerce, and collaboration processes among all business stakeholders in today’s networked enterprises and global markets. There is also an emphasis on ethical and security issues and challenges.
On completion of this course, we have achieved following objectives:
I have gone through detailed information, and analyzed how the business applications of information systems and information technologies can support a firm’s business processes, managerial decision making, and strategies fro competitive advantage.
I have identifiied the components, resources, and activities of an information system. This would include hardware, software, data, network, and people resources; as well as input, processing, output, storage, feedback and control components and activities. I am able to identify trends (past, present, and future) regarding components, resources, and activities.
I have Identified cross-functional enterprise systems, and been given examples of how they can provide significant business value to a company. This includes examples of how Internet and other information technologies support business processes within the functional areas of business (accounting, finance, human resource management, marketing, and production and operations management). Detail information about SAP.
I have learnt the major categories and trends of e-commerce applications. Compare and contrast e-commerce sites .Use the systems development life cycle as a problem-solving framework to help propose information systems solutions to simple business problems. This would include describing evaluation factors in the acquisition of hardware, software, and IS services, and identifying change management solutions for end user resistance.
I have been provided details about several ethical issues in how the use of information technologies in business affects employment, individuality, working conditions, privacy, crime, health, and solutions to societal problems.
I have Identified several types of security management strategies and defenses, and have been explained how they can be used to ensure the security of business applications of information technology.
I have Identified several cultural, political, and geoeconomic challenges that confront managers in the management of global information technologies. This was included explaining the effect on global business/IT strategy by international business organizations.
Wednesday, December 9, 2009
Tuesday, December 8, 2009
Social Networking and Business:
Social Networking sites were initially embraced by today’s youth and grew and continue to grow at exceptional rates. However, businesses, educators and other organizations are realizing that social networking sites are a means to interact, market and connect with others in real time. While traditional media remains popular, online social media may move to the forefront as the trend continues to grow and various methods are used to cultivate this phenomenon. For example, Twitter is used by some as a means to connect with colleagues and vendors while attending conferences. Facebook is used by many to market themselves or by companies marketing their particular products. As much as social networking is enabling businesses and individuals, so are social networking sites causing new ethical dilemmas. For example, companies need to be concerned that employees using social networking sites during work or from the office are not interfering with or revealing company business. As social networking sites continue to gain popularity among all ages, the way in which they are utilize also will continue to change and expand. Businesses are now considering the potential benefits of participating in on line discussion groups and how to incorporate social networks into their business strategy. As Facebook and MySpace turned into social sites that are now appearing attractive to all age groups globally, businesses can evaluate and be creative as to how online social tools can enhance their organization (Barlas, (2009). Various types of social networking sites will remain popular while others will fade out. However, the concept of individuals or groups communicating, people searching for former friends and colleagues and the ability to meet others and attract attention online anywhere in the world is a phenomenon that is here to stay.
Social Networking Sites in the Business Environment
While there are many popular social networking sites, there are handfuls that appear to be the most popular. The top three sites are MySpace, Facebook and YouTube (Barlas, 2009). Currently Twitter a microblogging site seems to be the latest craze among social network fanatics. Linkedin is another popular site, especially among professionals who are looking to network with others in the same field. Wikipedia is popular as it allows users to create the content on the site. The power of social networking should not be ignored by businesses. Some of the advantages are in the advertising and marketing, linking businesses or business units, job searches and recruiting, and the ability to cultivate new ideas (Barlas, 2009). One of the most potential benefits is the ability to network with others outside of your company and find information or solutions prevalent to your company or product. However, there are several challenges that social networking sites present to organizations. For example, social sites open up the opportunity for competitors to promote a negative image of a company. Under this circumstance the ability to down play a negative image can be difficult and costly. Employers will also have the decision as to how they will monitor the activities of their employees on social networking sites during working hours. Finally there is the issue of copyright infringement as social networking sites seem to attract this type of behavior. (Barlas, 2009). Although there are potential benefits for companies who use social networking within their corporate environment, companies need to be aware of potential problems that may present themselves. Companies and educators are already using social networking to their advantage, while others are finding the cons of social networking. Twitter is popular now and appears to be gaining popular in the business and education sector.
Social Networking Sites to Boost Business
Social media marketing is a fast-growing innovation, tapping into the rising influence of user-generated communities such as blogs, wikis, networking, and bookmarking sites.
By joining these active communities, you can build relationships and promote your products and/or expertise.
Generally, online social networks attract members who bond over shared interests and opinions. That creates a clubby and trusted group of virtually connected friends or associates. So when a member or blogger recommends your product, commends your service, or endorses your comments, it results in powerful "word of mouse" referrals.
Alternatively, if you make the effort, you can develop your own following on social media sites as an opinion-maker, authority, adviser, industry analyst, or wry observer.
As a result of getting noticed in all the right places, you can generate leads and convert those leads into sales.
Here are some proven ways to start stirring the pot.
1. Contribute to a community whose members mirror your customers. By checking into the comments, forums, and profiles of a community, you can determine member interests, locations, and a rough sense of demographics. Once you've identified a community that matches your preferred customer,
there are a number of ways to get noticed.
2. Become a commentator on a well-trafficked blog in your industry or field. Don't ignore the blogosphere.Get familiar with a few blogs compatible with your business. A good start is a search on Technorati as well as visits to your industry or professional associations and trade journals to see what they serve up. Make sure you're up-to-speed on the blog's tone, issues, and attitudes before you chime in. When you start generating reactions, you'll know you're hitting nerves.
3. Create a viral video campaign. Online videos are now cheap and easy to create and upload, notes search engine marketing consultant Susan Gilbert at JoomlaJump.com.
Produce a video of two to three minutes that dramatizes or explains your online site or your market niche and yourself. Then upload the video to MSN, YouTube, or other video communities to drive traffic to your Web site, Gilbert says.
If you link the videos to community pages on social bookmarking sites, you create a little network that search engines will find. Next thing you know, you're getting referred traffic and, potentially, more customers.
4. Join a professional networking site.
These can be hit or miss, depending on what you market and how you work the community. For professional services such as PR and consulting, it can generate leads. Check out examples such as LinkedIn, ZoomInfo, Facebook, and Biltmore Who's Who. Then branch out to others.
5. Launch a blog.
This is the most obvious idea, and, no question, online templates now make it easy to create a blog. Run a search and you'll find options. What's hard is to gain traction and keep posting lively content (with a link to your company site, of course). See these tips for starting a blog.
6. Become a dedicated gamer. Game for this? Depending on your wares and customer profile, engaging in the multi-user online gaming community can be a rewarding way to draw traffic and viral referrals, says Marian Sabety, at Wyndstorm, a social network technology marketer.
One of the largest is World of Warcraft, but new ones pop up frequently.
Unless you are already pulling lots of traffic, first gain experience with some of the above tactics before starting a blog. Once you have the hang of it, you'll know more about leveraging the power of a personal blog.
Finally, remember to add value rather than to merely advertise your product. To make social media marketing work, you must enjoy being part of the community.
Social Networking Sites in the Business Environment
While there are many popular social networking sites, there are handfuls that appear to be the most popular. The top three sites are MySpace, Facebook and YouTube (Barlas, 2009). Currently Twitter a microblogging site seems to be the latest craze among social network fanatics. Linkedin is another popular site, especially among professionals who are looking to network with others in the same field. Wikipedia is popular as it allows users to create the content on the site. The power of social networking should not be ignored by businesses. Some of the advantages are in the advertising and marketing, linking businesses or business units, job searches and recruiting, and the ability to cultivate new ideas (Barlas, 2009). One of the most potential benefits is the ability to network with others outside of your company and find information or solutions prevalent to your company or product. However, there are several challenges that social networking sites present to organizations. For example, social sites open up the opportunity for competitors to promote a negative image of a company. Under this circumstance the ability to down play a negative image can be difficult and costly. Employers will also have the decision as to how they will monitor the activities of their employees on social networking sites during working hours. Finally there is the issue of copyright infringement as social networking sites seem to attract this type of behavior. (Barlas, 2009). Although there are potential benefits for companies who use social networking within their corporate environment, companies need to be aware of potential problems that may present themselves. Companies and educators are already using social networking to their advantage, while others are finding the cons of social networking. Twitter is popular now and appears to be gaining popular in the business and education sector.
Social Networking Sites to Boost Business
Social media marketing is a fast-growing innovation, tapping into the rising influence of user-generated communities such as blogs, wikis, networking, and bookmarking sites.
By joining these active communities, you can build relationships and promote your products and/or expertise.
Generally, online social networks attract members who bond over shared interests and opinions. That creates a clubby and trusted group of virtually connected friends or associates. So when a member or blogger recommends your product, commends your service, or endorses your comments, it results in powerful "word of mouse" referrals.
Alternatively, if you make the effort, you can develop your own following on social media sites as an opinion-maker, authority, adviser, industry analyst, or wry observer.
As a result of getting noticed in all the right places, you can generate leads and convert those leads into sales.
Here are some proven ways to start stirring the pot.
1. Contribute to a community whose members mirror your customers. By checking into the comments, forums, and profiles of a community, you can determine member interests, locations, and a rough sense of demographics. Once you've identified a community that matches your preferred customer,
there are a number of ways to get noticed.
2. Become a commentator on a well-trafficked blog in your industry or field. Don't ignore the blogosphere.Get familiar with a few blogs compatible with your business. A good start is a search on Technorati as well as visits to your industry or professional associations and trade journals to see what they serve up. Make sure you're up-to-speed on the blog's tone, issues, and attitudes before you chime in. When you start generating reactions, you'll know you're hitting nerves.
3. Create a viral video campaign. Online videos are now cheap and easy to create and upload, notes search engine marketing consultant Susan Gilbert at JoomlaJump.com.
Produce a video of two to three minutes that dramatizes or explains your online site or your market niche and yourself. Then upload the video to MSN, YouTube, or other video communities to drive traffic to your Web site, Gilbert says.
If you link the videos to community pages on social bookmarking sites, you create a little network that search engines will find. Next thing you know, you're getting referred traffic and, potentially, more customers.
4. Join a professional networking site.
These can be hit or miss, depending on what you market and how you work the community. For professional services such as PR and consulting, it can generate leads. Check out examples such as LinkedIn, ZoomInfo, Facebook, and Biltmore Who's Who. Then branch out to others.
5. Launch a blog.
This is the most obvious idea, and, no question, online templates now make it easy to create a blog. Run a search and you'll find options. What's hard is to gain traction and keep posting lively content (with a link to your company site, of course). See these tips for starting a blog.
6. Become a dedicated gamer. Game for this? Depending on your wares and customer profile, engaging in the multi-user online gaming community can be a rewarding way to draw traffic and viral referrals, says Marian Sabety, at Wyndstorm, a social network technology marketer.
One of the largest is World of Warcraft, but new ones pop up frequently.
Unless you are already pulling lots of traffic, first gain experience with some of the above tactics before starting a blog. Once you have the hang of it, you'll know more about leveraging the power of a personal blog.
Finally, remember to add value rather than to merely advertise your product. To make social media marketing work, you must enjoy being part of the community.
Twitter email security issues
You might think your password protects the confidential information stored on Web sites. But as Twitter executives discovered, that is a dangerous assumption.
The Web was abuzz after it was revealed that a hacker had broken into the e-mail account of a Twitter employee and had exposed corporate information. The breach raised red flags for individuals as well as businesses about the passwords used to secure information they store on the Web.
On Web sites containing personal information like e-mail, financial data or documents, there is usually just a user name and password for protection. More individuals are storing information on Web servers, where it is accessible from any online computer through services offered by Google, Amazon and Microsoft; social networks like Facebook; and backup services like Mozy.
But password-protected sites are growing more vulnerable because, to keep up with the growing number of passwords, people use the same simple ones on numerous sites across the Web. In a study last year, Sophos, an Internet security company, found that 40 percent of Internet users use the same password for every Web site they access.
The attack on Twitter highlights the problem. For its internal documents, the company uses the business version of Google Apps, a service that Google offers to individuals free. Google Apps provides e-mail, word processing, spreadsheets and calendars via the Web.
The content is stored on Google's servers, which can save time and money and allow employees to work together on documents at the same time. But it also means that the security is only as good as the password. A hacker who breaks into one person's account can access information shared by friends, family members or colleagues, which is what happened at Twitter.
The Twitter breach occurred about a month ago, Twitter said. A hacker calling himself Hacker Croll broke into an administrative employee's e-mail account and gained access to the employee's Google Apps account, where Twitter shares spreadsheets and documents with business ideas and financial details, Biz Stone, a Twitter co- founder, said.
The hacker then sent documents about company plans and finances, confidential contracts and job applicants to two technology news blogs, TechCrunch, in Silicon Valley, and Korben, in France. This bring to bear another issue of these companies taken this "stolen" information and publishing it as news, but that is another issue.
There was also personal information about Twitter employees, including credit card numbers.
The hacker also broke into the e-mail account of the wife of Evan Williams, Twitter's chief executive, and from there accessed several of Mr. Williams' personal Internet accounts, including those at Amazon and PayPal, Mr. Stone said.
TechCrunch revealed documents showing that Twitter, a private company that so far has no revenue, projected it would reach a billion users and $1.54 billion in revenue by 2013. Michael Arrington, founder of TechCrunch, said during an interview that the hacker had also sent him detailed strategy documents about potential business models, and the competitive threat from Facebook.
Some analysts say the breach highlights how dangerous it can be for people and companies to store confidential documents on Web servers, or "in the cloud."
But Mr. Stone said the attack "isn't about any flaw in Web apps," but rather about a bigger issue that affects individuals and businesses alike. "It speaks to the importance of following good personal security guidelines like choosing strong passwords," he said.
Instead of circumventing security, it appears the Twitter hacker correctly answered personal questions that Gmail asks of users to reset the password.
"If you broadcast all your details about what your dog's name is and what your hometown is, it's not that hard to figure out a password," said Chris King, director of product marketing at Palo Alto Networks, which creates firewalls.
The Twitter hacker posted a blog message claiming to have wanted to teach people to be more careful on the Net.
The Web was abuzz after it was revealed that a hacker had broken into the e-mail account of a Twitter employee and had exposed corporate information. The breach raised red flags for individuals as well as businesses about the passwords used to secure information they store on the Web.
On Web sites containing personal information like e-mail, financial data or documents, there is usually just a user name and password for protection. More individuals are storing information on Web servers, where it is accessible from any online computer through services offered by Google, Amazon and Microsoft; social networks like Facebook; and backup services like Mozy.
But password-protected sites are growing more vulnerable because, to keep up with the growing number of passwords, people use the same simple ones on numerous sites across the Web. In a study last year, Sophos, an Internet security company, found that 40 percent of Internet users use the same password for every Web site they access.
The attack on Twitter highlights the problem. For its internal documents, the company uses the business version of Google Apps, a service that Google offers to individuals free. Google Apps provides e-mail, word processing, spreadsheets and calendars via the Web.
The content is stored on Google's servers, which can save time and money and allow employees to work together on documents at the same time. But it also means that the security is only as good as the password. A hacker who breaks into one person's account can access information shared by friends, family members or colleagues, which is what happened at Twitter.
The Twitter breach occurred about a month ago, Twitter said. A hacker calling himself Hacker Croll broke into an administrative employee's e-mail account and gained access to the employee's Google Apps account, where Twitter shares spreadsheets and documents with business ideas and financial details, Biz Stone, a Twitter co- founder, said.
The hacker then sent documents about company plans and finances, confidential contracts and job applicants to two technology news blogs, TechCrunch, in Silicon Valley, and Korben, in France. This bring to bear another issue of these companies taken this "stolen" information and publishing it as news, but that is another issue.
There was also personal information about Twitter employees, including credit card numbers.
The hacker also broke into the e-mail account of the wife of Evan Williams, Twitter's chief executive, and from there accessed several of Mr. Williams' personal Internet accounts, including those at Amazon and PayPal, Mr. Stone said.
TechCrunch revealed documents showing that Twitter, a private company that so far has no revenue, projected it would reach a billion users and $1.54 billion in revenue by 2013. Michael Arrington, founder of TechCrunch, said during an interview that the hacker had also sent him detailed strategy documents about potential business models, and the competitive threat from Facebook.
Some analysts say the breach highlights how dangerous it can be for people and companies to store confidential documents on Web servers, or "in the cloud."
But Mr. Stone said the attack "isn't about any flaw in Web apps," but rather about a bigger issue that affects individuals and businesses alike. "It speaks to the importance of following good personal security guidelines like choosing strong passwords," he said.
Instead of circumventing security, it appears the Twitter hacker correctly answered personal questions that Gmail asks of users to reset the password.
"If you broadcast all your details about what your dog's name is and what your hometown is, it's not that hard to figure out a password," said Chris King, director of product marketing at Palo Alto Networks, which creates firewalls.
The Twitter hacker posted a blog message claiming to have wanted to teach people to be more careful on the Net.
Issues using face book
Security issues:
It seems to me that facebook collects (or has the opportunity to) collect much more information than the other platforms out there. To even join a “network” that is a university/college, it requires you to enter in your personal email account at that particular institution. Some people even have their resumes (work history) on there so to speak. Literally, be it friend, foe, neighbour, peeping Tom, Dick, and Harry, or employer can do a search for your name and look you up.
Even worse, is people can tag others on pictures. So yesterday, as I took a look at facebook, I realized I belonged to a network, which allowed me to see a lot of pages of people who belonged in the network. And a classmate of mine had signed up, and then put really embarrassing pictures of another classmate who was extremely drunk and silly looking on her facebook album. And to top it off, she had tagged it. Lovely. At that very moment I was thanking my lucky stars I wasn’t the one in her picture. How embarrassing. There it was, out there for the world to see.
And then… there was another classmate who had received a “private” e-present in the picture of a thong, but for some reason it was available for everyone who was a friend of the person to see. Ewww. Also embarrassing.
Anyways, it seems according to wikipedia, Facebook has quite a bit of issues with security. I can just even think of datamining being a big issue with this as people have their real names, their school affiliations, their coursework, their emails, contacts, relatives, and friends… the list is endless. Scary actually.
Privacy Issues:
Facebook's growth as an Internet social networking site has met criticism on a range of issues, especially the privacy of users, child safety, the use of advertising scripts, data mining, and the inability to terminate accounts without first manually deleting all the content. Many companies removed their adverts from the site in 2007 because they were being displayed on the pages of controversial individuals and groups. The actual content of user's pages, groups and forums has been criticised for promoting controversial topics such as pro-anorexia and holocaust denial. There have been several issues with censorship, both on and off the site. The changes made by Facebook have been criticised, in particular the new format launched in 2008 and the changes in Facebook's Terms of Use which removed the clause detailing automatic expiry of deleted content. Facebook has also been successfully sued several times for violation of intellectual property rights.
There have been some concerns expressed regarding the use of Facebook as a means of surveillance and data mining. Theories have been written about the possible misuse of Facebook and privacy proponents have criticized the site’s current privacy agreement. According to the policy, “We may use information about you that we collect from other sources, including but not limited to newspapers and Internet sources such as blogs, instant messaging services and other users of Facebook, to supplement your profile.” However, some features—such as AIM away message harvesting and campus newspaper monitoring have been dropped and Facebook has since responded to the concerns. Facebook has assured worried users the next privacy policy will not include the clause about information collection and has denied any data mining is being done for the CIA or any other group. However, the possibility of data mining by private individuals unaffiliated with Facebook remains open, as evidenced by the fact that two MIT students were able to download, using an automated script, over 70,000 Facebook profiles from four schools (MIT, NYU, the University of Oklahoma, and Harvard) as part of a research project on Facebook privacy published on December 14th, 2005.
It seems to me that facebook collects (or has the opportunity to) collect much more information than the other platforms out there. To even join a “network” that is a university/college, it requires you to enter in your personal email account at that particular institution. Some people even have their resumes (work history) on there so to speak. Literally, be it friend, foe, neighbour, peeping Tom, Dick, and Harry, or employer can do a search for your name and look you up.
Even worse, is people can tag others on pictures. So yesterday, as I took a look at facebook, I realized I belonged to a network, which allowed me to see a lot of pages of people who belonged in the network. And a classmate of mine had signed up, and then put really embarrassing pictures of another classmate who was extremely drunk and silly looking on her facebook album. And to top it off, she had tagged it. Lovely. At that very moment I was thanking my lucky stars I wasn’t the one in her picture. How embarrassing. There it was, out there for the world to see.
And then… there was another classmate who had received a “private” e-present in the picture of a thong, but for some reason it was available for everyone who was a friend of the person to see. Ewww. Also embarrassing.
Anyways, it seems according to wikipedia, Facebook has quite a bit of issues with security. I can just even think of datamining being a big issue with this as people have their real names, their school affiliations, their coursework, their emails, contacts, relatives, and friends… the list is endless. Scary actually.
Privacy Issues:
Facebook's growth as an Internet social networking site has met criticism on a range of issues, especially the privacy of users, child safety, the use of advertising scripts, data mining, and the inability to terminate accounts without first manually deleting all the content. Many companies removed their adverts from the site in 2007 because they were being displayed on the pages of controversial individuals and groups. The actual content of user's pages, groups and forums has been criticised for promoting controversial topics such as pro-anorexia and holocaust denial. There have been several issues with censorship, both on and off the site. The changes made by Facebook have been criticised, in particular the new format launched in 2008 and the changes in Facebook's Terms of Use which removed the clause detailing automatic expiry of deleted content. Facebook has also been successfully sued several times for violation of intellectual property rights.
There have been some concerns expressed regarding the use of Facebook as a means of surveillance and data mining. Theories have been written about the possible misuse of Facebook and privacy proponents have criticized the site’s current privacy agreement. According to the policy, “We may use information about you that we collect from other sources, including but not limited to newspapers and Internet sources such as blogs, instant messaging services and other users of Facebook, to supplement your profile.” However, some features—such as AIM away message harvesting and campus newspaper monitoring have been dropped and Facebook has since responded to the concerns. Facebook has assured worried users the next privacy policy will not include the clause about information collection and has denied any data mining is being done for the CIA or any other group. However, the possibility of data mining by private individuals unaffiliated with Facebook remains open, as evidenced by the fact that two MIT students were able to download, using an automated script, over 70,000 Facebook profiles from four schools (MIT, NYU, the University of Oklahoma, and Harvard) as part of a research project on Facebook privacy published on December 14th, 2005.
Friday, December 4, 2009
Biggest one-month gain in Canadian jobs since September 2008
Canada's economy created 79,100 jobs in November, busting through forecasts for a modest 15,000 job increase. This rise eclipsed the 43,200 jobs lost in October and is consistent with an acceleration in growth in the economy. The unemployment rate edged down to 8.5% from 8.6% in October as the strong employment gains outstripped the 65,800 rise in the labour force in the month.
November's gain in employment reflected a rebound in part-time employment which rose 40,400 partially recovering the 59,700 drop recorded in October. Full-time jobs increased by 38,600 for a total of 146,700 jobs created during the past three months. Both private companies and the public sector were hiring in November with the largest increases in employment in Ontario, Quebec and Alberta.
Gains were concentrated in the services-producing industries, which added 73,000 jobs and more than reversed October's 37,000 loss. A surge in hiring in educational services of 37,900 accounted for one-half the service-sector increase. Retail and wholesale trade were steady after 30,800 positions were cut in October. Finance, insurance and real estate, professional services and public administration posted solid gains in the month. In the goods-producing industries a modest 6,200 jobs were created, almost exactly recovering the 6,300 positions cut in October. Manufacturers added to their payrolls, while employment in construction and utilities was cut back.
The annual gain in the average hourly wage rate for permanent workers slowed in November to 2.1% from 2.9% in October, the slowest annual pace since March 2007.
The labour data have been very volatile but, on net, 66,500 jobs were created in the three months to November, which supports our call for more robust growth in the fourth quarter. Still, the amount of slack generated during the recession is consistent with the unemployment rate remaining relatively high, at least until the pace of economic growth heats up enough to chew through some of the large output gap.
The start to the recovery — Canada's economy grew at a 0.4% annualized pace in the third quarter — fell short of the Bank of Canada's forecast, supporting the case for monetary policy to remain stimulative until the recovery builds momentum. The soft start also keeps alive the risk that the unemployment rate will rise in the months ahead and is consistent with inflation pressures remaining subdued.
Our forecast that the fourth quarter will see a much stronger pick-up in growth, with the recovery's momentum building in 2010 sets up for the unemployment rate to peak early next year and then gradually drift low. As this occurs, the Bank will look to remove monetary stimulus, although conditions aren't likely to warrant rates to start to move higher until the third quarter of next year. On balance, this week's data are not expected to cause the Bank change its stance at next week's rate setting, with the conditional commitment to a 0.25% overnight rate likely to be maintained.
Dawn Desjardins, Assistant Chief Economist, RBC Economics Research
November's gain in employment reflected a rebound in part-time employment which rose 40,400 partially recovering the 59,700 drop recorded in October. Full-time jobs increased by 38,600 for a total of 146,700 jobs created during the past three months. Both private companies and the public sector were hiring in November with the largest increases in employment in Ontario, Quebec and Alberta.
Gains were concentrated in the services-producing industries, which added 73,000 jobs and more than reversed October's 37,000 loss. A surge in hiring in educational services of 37,900 accounted for one-half the service-sector increase. Retail and wholesale trade were steady after 30,800 positions were cut in October. Finance, insurance and real estate, professional services and public administration posted solid gains in the month. In the goods-producing industries a modest 6,200 jobs were created, almost exactly recovering the 6,300 positions cut in October. Manufacturers added to their payrolls, while employment in construction and utilities was cut back.
The annual gain in the average hourly wage rate for permanent workers slowed in November to 2.1% from 2.9% in October, the slowest annual pace since March 2007.
The labour data have been very volatile but, on net, 66,500 jobs were created in the three months to November, which supports our call for more robust growth in the fourth quarter. Still, the amount of slack generated during the recession is consistent with the unemployment rate remaining relatively high, at least until the pace of economic growth heats up enough to chew through some of the large output gap.
The start to the recovery — Canada's economy grew at a 0.4% annualized pace in the third quarter — fell short of the Bank of Canada's forecast, supporting the case for monetary policy to remain stimulative until the recovery builds momentum. The soft start also keeps alive the risk that the unemployment rate will rise in the months ahead and is consistent with inflation pressures remaining subdued.
Our forecast that the fourth quarter will see a much stronger pick-up in growth, with the recovery's momentum building in 2010 sets up for the unemployment rate to peak early next year and then gradually drift low. As this occurs, the Bank will look to remove monetary stimulus, although conditions aren't likely to warrant rates to start to move higher until the third quarter of next year. On balance, this week's data are not expected to cause the Bank change its stance at next week's rate setting, with the conditional commitment to a 0.25% overnight rate likely to be maintained.
Dawn Desjardins, Assistant Chief Economist, RBC Economics Research
Tuesday, November 10, 2009
Tuesday, October 6, 2009
What is Sound Money By Dr. Ron Paul
Henry Ford once said, “It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
Are you confused by all the talk about monetary policy, fiat money and inflation? You’re not alone. Bankers and politicians have worked hand in hand for many decades to obscure their activities from the public. They hide behind elaborate structures designed to inflate the money supply while creating the false impression that they are looking out for our best interests.
Inflation is a very simple concept to understand: More money = less value. It may seem contradictory but it’s very straightforward.
For illustration purposes, join me on a brief journey of the imagination. One beautiful morning, you wake up and realize that you own twice as much cash as you had just last night. Magic money elves entered your home and bank account and simply doubled your entire cash assets. You’re now twice as wealthy (or half as poor as the case may be).
But you soon realize that the same thing happened to everyone else in the country. The money supply (total amount of money) has doubled! It’s just a one-time event and your regular income remains the same… you just got lucky this one time. It’s okay to dream, so stay with me.
What happens next? If you’re like most people, you probably start spending. You buy things you always wanted to buy but couldn’t afford. You pay back some debts. You buy stocks. In other words, you put the new money into circulation. So do most other people in the country.
Demand for many products increases because a lot more people can afford them now. Consumers are buying so much stuff that some shortages occur. To protect themselves against these shortages, shops and businesses decide to increase their prices. They know that once prices go up, fewer people will be competing to buy the same products, and the situation will be back to normal.
As a side effect of these higher prices, shop owners start earning higher profits than usual. They have more money in their bank accounts, which allows them to increase their spending. They will invest in new stock or expand their business. They might pay out dividends to their investors and bonuses to their employees, allowing these people to buy more products as well. This additional demand puts even more pressure on other shops to increase their prices.
A few months later, prices of almost everything have gone up. Suppliers and manufacturers are faced with the same threat of too much sudden demand from their clients so they too decide to start charging more.
You went on a one-time buying spree and look what happened! Your income stayed the same, but after a few weeks you can suddenly no longer afford the products you used to buy all the time because all prices in the economy have gone up.
Naturally, you demand a higher salary from your employer. If you’re self-employed or in business, you have to charge your customers more money just so that you can maintain your standard of living. Everyone else is in the same situation. Higher prices keep spreading throughout the entire economy, and it’s getting more and more difficult to make a living.
Can you see how this lucky one-time incident which at first seemed so exciting was extremely harmful not just for you but for the entire country? You briefly had a good time but now you’re worse off than before. In our story there are now twice as many dollars in circulation, but your income remains the same and each dollar you earn is worth only about half as much as it used to be. You’re really hoping for those money elves to come back.
As a matter of fact, some people, companies and banks have managed to develop an inside connection to the “money elves”, allowing them to receive new money into their bank accounts whenever they want to. The money is officially a loan (credit), but they know they never have to pay it back… they just “roll it over”, i.e. take up even more debt. With all that easy money in their accounts, and after hearing on TV that stocks only go up and that real estate prices will continue to rise forever, they tend to get a bit lightheaded and start making bad investment decisions. They know that if anything happens to their investments they will be bailed out by the government, so they do not hesitate to take huge risks with their new found “wealth”.
Let’s stop dreaming and look at the reality of things. What if I told you that these “money elves” do exist and that they spring into action not just once in a lifetime, but every couple of weeks? And that they repeatedly give money to their closest friends, but not to you? That prices are going up because the total amount of money in circulation increases, but that you’re missing out on all the fun?
Well, that’s inflation at work. Who benefits from inflation? Only those who are at the top of the pyramid and receive all that new money directly from the source. As you might have guessed by now, the source is the Federal Reserve, and its recipients include the government which “borrows” a lot of new money each year, without any intention of ever paying it back. Another beneficiary these days are failed banks that are being “bailed out” for the good of the “economy”, or defense contractors that receive money to build up our military so we can have a constant presence all over the world and fight never-ending and unnecessary wars. There was even a huge number of small-time beneficiaries who received consumer loans and sub-prime mortgages they would never be able to pay back.
What, then, is fiat money? It’s exactly what we just talked about: money that can be inflated or increased at the push of a button at the say-so of a powerful person or organization. Nowadays most dollars are just blimps on a computer screen and it’s extremely easy for the Federal Reserve to create money out of thin air whenever they want to.
If our money were backed by gold and silver, people couldn’t just sit in some fancy building and push a button to create new money. They would have to engage in honest trade with another party that already has some gold in their possession. Alternatively, they would have to risk their lives and assets to find a suitable spot to build a gold mine, then get dirty and sweaty and actually dig up the gold. Not something I can imagine our “money elves” at the Fed getting down to whenever they feel like playing God with the economy.
As you can see, inflation and fiat money are very seductive and beneficial to those at the top, and very dangerous to everyone else and the nation as a whole. That’s exactly what Henry Ford was talking about. He knew that every country that relies too much on fiat money is ruined sooner rather than later.
There is only one possible solution to the inflation problem: Stop creating money out of thin air. But we’re already in such a mess that the only way to have a real impact on the money supply is to increase interest rates so that people pay back their loans and borrow less money from the banks, which decreases the amount of money in circulation. However, higher interest rates might very well crash the economy. So the Fed’s current “solution” to overcoming inflation is… creating even more of it.
Fiat money is a dangerous addiction. Even if the Fed found a way to stop inflation, as long as the current system persists the temptation will always be there to resume pushing the easy money button. That’s why we need to get back on the gold standard and eliminate the Federal Reserve altogether.
But that won’t happen “before tomorrow morning”, as Henry Ford said, or even this year. Ron Paul believes that the first step towards monetary freedom is to allow open competition in currencies. Once gold and silver are allowed as legal tender and can be sold without sales tax, everyone can use them to store their wealth and to pay for the things they want to buy. The Federal Reserve will finally have a very compelling motivation to stay honest and maintain the value of the dollar because if they don’t, they will simply lose all their customers.
Are you confused by all the talk about monetary policy, fiat money and inflation? You’re not alone. Bankers and politicians have worked hand in hand for many decades to obscure their activities from the public. They hide behind elaborate structures designed to inflate the money supply while creating the false impression that they are looking out for our best interests.
Inflation is a very simple concept to understand: More money = less value. It may seem contradictory but it’s very straightforward.
For illustration purposes, join me on a brief journey of the imagination. One beautiful morning, you wake up and realize that you own twice as much cash as you had just last night. Magic money elves entered your home and bank account and simply doubled your entire cash assets. You’re now twice as wealthy (or half as poor as the case may be).
But you soon realize that the same thing happened to everyone else in the country. The money supply (total amount of money) has doubled! It’s just a one-time event and your regular income remains the same… you just got lucky this one time. It’s okay to dream, so stay with me.
What happens next? If you’re like most people, you probably start spending. You buy things you always wanted to buy but couldn’t afford. You pay back some debts. You buy stocks. In other words, you put the new money into circulation. So do most other people in the country.
Demand for many products increases because a lot more people can afford them now. Consumers are buying so much stuff that some shortages occur. To protect themselves against these shortages, shops and businesses decide to increase their prices. They know that once prices go up, fewer people will be competing to buy the same products, and the situation will be back to normal.
As a side effect of these higher prices, shop owners start earning higher profits than usual. They have more money in their bank accounts, which allows them to increase their spending. They will invest in new stock or expand their business. They might pay out dividends to their investors and bonuses to their employees, allowing these people to buy more products as well. This additional demand puts even more pressure on other shops to increase their prices.
A few months later, prices of almost everything have gone up. Suppliers and manufacturers are faced with the same threat of too much sudden demand from their clients so they too decide to start charging more.
You went on a one-time buying spree and look what happened! Your income stayed the same, but after a few weeks you can suddenly no longer afford the products you used to buy all the time because all prices in the economy have gone up.
Naturally, you demand a higher salary from your employer. If you’re self-employed or in business, you have to charge your customers more money just so that you can maintain your standard of living. Everyone else is in the same situation. Higher prices keep spreading throughout the entire economy, and it’s getting more and more difficult to make a living.
Can you see how this lucky one-time incident which at first seemed so exciting was extremely harmful not just for you but for the entire country? You briefly had a good time but now you’re worse off than before. In our story there are now twice as many dollars in circulation, but your income remains the same and each dollar you earn is worth only about half as much as it used to be. You’re really hoping for those money elves to come back.
As a matter of fact, some people, companies and banks have managed to develop an inside connection to the “money elves”, allowing them to receive new money into their bank accounts whenever they want to. The money is officially a loan (credit), but they know they never have to pay it back… they just “roll it over”, i.e. take up even more debt. With all that easy money in their accounts, and after hearing on TV that stocks only go up and that real estate prices will continue to rise forever, they tend to get a bit lightheaded and start making bad investment decisions. They know that if anything happens to their investments they will be bailed out by the government, so they do not hesitate to take huge risks with their new found “wealth”.
Let’s stop dreaming and look at the reality of things. What if I told you that these “money elves” do exist and that they spring into action not just once in a lifetime, but every couple of weeks? And that they repeatedly give money to their closest friends, but not to you? That prices are going up because the total amount of money in circulation increases, but that you’re missing out on all the fun?
Well, that’s inflation at work. Who benefits from inflation? Only those who are at the top of the pyramid and receive all that new money directly from the source. As you might have guessed by now, the source is the Federal Reserve, and its recipients include the government which “borrows” a lot of new money each year, without any intention of ever paying it back. Another beneficiary these days are failed banks that are being “bailed out” for the good of the “economy”, or defense contractors that receive money to build up our military so we can have a constant presence all over the world and fight never-ending and unnecessary wars. There was even a huge number of small-time beneficiaries who received consumer loans and sub-prime mortgages they would never be able to pay back.
What, then, is fiat money? It’s exactly what we just talked about: money that can be inflated or increased at the push of a button at the say-so of a powerful person or organization. Nowadays most dollars are just blimps on a computer screen and it’s extremely easy for the Federal Reserve to create money out of thin air whenever they want to.
If our money were backed by gold and silver, people couldn’t just sit in some fancy building and push a button to create new money. They would have to engage in honest trade with another party that already has some gold in their possession. Alternatively, they would have to risk their lives and assets to find a suitable spot to build a gold mine, then get dirty and sweaty and actually dig up the gold. Not something I can imagine our “money elves” at the Fed getting down to whenever they feel like playing God with the economy.
As you can see, inflation and fiat money are very seductive and beneficial to those at the top, and very dangerous to everyone else and the nation as a whole. That’s exactly what Henry Ford was talking about. He knew that every country that relies too much on fiat money is ruined sooner rather than later.
There is only one possible solution to the inflation problem: Stop creating money out of thin air. But we’re already in such a mess that the only way to have a real impact on the money supply is to increase interest rates so that people pay back their loans and borrow less money from the banks, which decreases the amount of money in circulation. However, higher interest rates might very well crash the economy. So the Fed’s current “solution” to overcoming inflation is… creating even more of it.
Fiat money is a dangerous addiction. Even if the Fed found a way to stop inflation, as long as the current system persists the temptation will always be there to resume pushing the easy money button. That’s why we need to get back on the gold standard and eliminate the Federal Reserve altogether.
But that won’t happen “before tomorrow morning”, as Henry Ford said, or even this year. Ron Paul believes that the first step towards monetary freedom is to allow open competition in currencies. Once gold and silver are allowed as legal tender and can be sold without sales tax, everyone can use them to store their wealth and to pay for the things they want to buy. The Federal Reserve will finally have a very compelling motivation to stay honest and maintain the value of the dollar because if they don’t, they will simply lose all their customers.
Former US Presidential Candidate DR. Ron Paul "Free trade instead of Bomb and Bribes"
What if tomorrow morning you woke up to headlines that yet another Chinese drone bombing on US soil killed several dozen ranchers in a rural community while they were sleeping? That a drone aircraft had come across the Canadian border in the middle of the night and carried out the latest of many attacks? What if it was claimed that many of the victims harbored anti-Chinese sentiments, but most of the dead were innocent women and children? And what if the Chinese administration, in an effort to improve its public image in the US, had approved an aid package to send funds to help with American roads and schools and promote Chinese values here?
Most Americans would not stand for it. Yet the above hypothetical events are similar to what our government is doing in Pakistan. Last week, Congress did approve an aid package for Pakistan for the stated purposes of improving our image and promoting democracy. I again made the point on the floor of the House that still no one seems to hear: What if this happened on US soil? What if innocent Americans were being killed in repeated drone attacks carried out by some foreign force who was trying to fix our problems for us? Would sending money help their image? If another nation committed this type of violence and destruction on our homeland, would we be at all interested in adopting their values?
Sadly, one thing that has entirely escaped modern American foreign policy is empathy. Without much humility or regard for human life, our foreign policy has been reduced to alternately bribing and bombing other nations, all with the stated goal of “promoting democracy”. But if a country democratically elects a leader who is not sufficiently pro-American, our government will refuse to recognize them, will impose sanctions on them, and will possibly even support covert efforts to remove them. Democracy is obviously not what we are interested in. It is more likely that our government is interested in imposing its will on other governments. This policy of endless intervention in the affairs of others is very damaging to American liberty and security.
If we were really interested in democracy, peace, prosperity and safety, we would pursue more free trade with other countries. Free and abundant trade is much more conducive to peace because it is generally bad business to kill your customers. When one’s livelihood is on the line, and the business agreements are mutually beneficial, it is in everyone’s best interests to maintain cooperative and friendly relations and not kill each other. But instead, to force other countries to bend to our will, we impose trade barriers and sanctions. If our government really wanted to promote freedom, Americans would be free to travel and trade with whoever they wished. And, if we would simply look at our own policies around the world through the eyes of others, we would understand how these actions make us more targeted and therefore less safe from terrorism. The only answer is get back to free trade with all and entangling alliances with none. It is our bombs and sanctions and condescending aid packages that isolate us.
Most Americans would not stand for it. Yet the above hypothetical events are similar to what our government is doing in Pakistan. Last week, Congress did approve an aid package for Pakistan for the stated purposes of improving our image and promoting democracy. I again made the point on the floor of the House that still no one seems to hear: What if this happened on US soil? What if innocent Americans were being killed in repeated drone attacks carried out by some foreign force who was trying to fix our problems for us? Would sending money help their image? If another nation committed this type of violence and destruction on our homeland, would we be at all interested in adopting their values?
Sadly, one thing that has entirely escaped modern American foreign policy is empathy. Without much humility or regard for human life, our foreign policy has been reduced to alternately bribing and bombing other nations, all with the stated goal of “promoting democracy”. But if a country democratically elects a leader who is not sufficiently pro-American, our government will refuse to recognize them, will impose sanctions on them, and will possibly even support covert efforts to remove them. Democracy is obviously not what we are interested in. It is more likely that our government is interested in imposing its will on other governments. This policy of endless intervention in the affairs of others is very damaging to American liberty and security.
If we were really interested in democracy, peace, prosperity and safety, we would pursue more free trade with other countries. Free and abundant trade is much more conducive to peace because it is generally bad business to kill your customers. When one’s livelihood is on the line, and the business agreements are mutually beneficial, it is in everyone’s best interests to maintain cooperative and friendly relations and not kill each other. But instead, to force other countries to bend to our will, we impose trade barriers and sanctions. If our government really wanted to promote freedom, Americans would be free to travel and trade with whoever they wished. And, if we would simply look at our own policies around the world through the eyes of others, we would understand how these actions make us more targeted and therefore less safe from terrorism. The only answer is get back to free trade with all and entangling alliances with none. It is our bombs and sanctions and condescending aid packages that isolate us.
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