Finance Financial Management And Price Earnings Ratios Finance Essay - Free Essay Example

Sample details Pages: 18 Words: 5543 Downloads: 2 Date added: 2017/06/26 Category Finance Essay Type Argumentative essay Did you like this example? Price earnings ratio (P/E ratio) is the ratio between market price per equity share and earnings per share. Earnings per share is calculated by dividing the net profit after taxes and preference dividend by the total number of equity shares. Earnings per share (EPS) is the portion of a companys profit allocated to each outstanding share of common stock. Don’t waste time! Our writers will create an original "Finance Financial Management And Price Earnings Ratios Finance Essay" essay for you Create order Note that EPS can be from the last four quarters (trailing P/E) or the sum of the last two actual quarters and the estimates of the next two quarters, but it is important to note that the P/E ratio is a measure of investors expectations as to future earnings and not for current earnings. In many cases, the ratio of a stock price to earnings per share or the price which must be paid for each pound of the firms earnings is used as basis for comparing the investment characteristics of different shares. A share price on its own tells us little or nothing about its investment value. Two companies with identical prospects, assets and aggregate equity value may have different share prices quite simply because one firm has fewer shares outstanding than the other. This may be the result of a company having fewer shares issued at a higher price than the other or it may mean that a company paid out fewer dividends in order to finance its past growth through retentions, while the other company p aid out higher dividends and raised capital by issuing more shares to fund its investment programmes. In other words, two identical companies can have different prices as a result of the number of shares outstanding. Since EPS and share prices can be affected by the number of shares outstanding P/E will neutralize the impact of these differences. By dividing the stock price by earnings per share a simple way has been found of standardizing share prices that otherwise cannot be meaningfully compared. For example, the Barclays PLC which is a major global financial services provider is currently trading (Po) at 315p a share and the Earnings per share expected in the next four quarters (E1) are 34.99p per share. The P/E ratio for the stock of Barclays PLC will be equal to 9 times (315p/34.99p). In our case, which Barclays PLC is currently trading at a multiple (P/E) of 9 times, the interpretation is that an investor is willing to pay 9 pounds for each pound of current earnings. ) a) ii) In order to identify and briefly discuss the theoretical determinants of P/E ratio the Gordon growth model will be utilized. The Gordon growth model, named after its inventor Myron Gordon, makes the dividend valuation model easier to use by combining it with additional assumptions, which will be given later in our discussion. Shares are valued on the basis of the payoffs which they are expected to generate for investors. In principle the value of the payoff expected from holding a share is simply the present value of the cash flows anticipated by investors. What investors expect to get out of any share they hold are dividends (Dt) and the proceeds (PN) from the sale of the share at the end of the planned holding period (N). The present value of the expected cash flows (the dividends expected and the proceeds from the sale) is determined by using a discount rate which is equivalent to the rate of return which investors can earn on investments in other shares of similar risk (r). The v alue of the share (Po) may be determined by using a model of the following nature: A simple valuation equation can also be developed for the shares of a firm that retains some of its earnings to finance investment as long as its assets, earnings and dividends can be expected to grow at a constant rate (g). This produces the following model, referred as the Gordon Model (see Gordon, 1959).- where D1 = D0 (1+g) This model suggests that the price of share is a function of the dividend expected in the next period (D1), the rate of growth of dividends (g) and the discount rate (r). By specifying the dividend, in terms of earnings per share (E1), the retention ratio (b) and the payout ratio (1-b) the above model can be demonstrated as below: Some insights into why price-earnings ratios can be expected to vary from firm to firm can be derived form a consideration of the previous model. This particular model suggests that the prospective P/E ratio will be higher the lower the discount rate (r), the greater the expected rate of growth (g), and the lower the retention ratio (b). In the case that the expected growth rate (g) is the same as the historical growth the prospective P/E ratio can be adjusted to obtain a ratio based on the last reported earnings: At first sight it is evident that there is an inverse relationship between the P/E ratio and the retention ratio (b), but this cannot be true since firms can not influence their P/E ratios by manipulating their retention ratios. Stockholders will pay more per pound of earnings the greater the proportion of earnings paid out in dividends all else being equal, but any reduction in retention will lead to a fall in investment, which will lead to a decrease in the expected rate of growth of dividends. The constant growth model has become the most widely employed theoretical model because of its simplicity. The simplicity of the constant growth model is a reflection of the assumptions on which the model is based, and the awareness of these assumptions is essential for the recognition of its weaknesses and strengths. It is assumed that: all investment is financed from retentions and a constant proportion of earnings is retained in each time period; the rate of return on the firms investments is constant over time, as the rate of return on existing assets; and the cash flow produced from investments is constant in perpetuity. QUESTION 2 a) iii) The differences in P/E ratios reported in the financial press cannot all be explained by the determinants of the P/E ratios identified by the valuation models. For example, one of the reasons for those differences can be the differences in the accounting methods employed by firms. The valuation models are based on an idealised notion of expected earnings per share; the firms expected cash flows minus an allowance for depreciation, calculated on an economic basis, while observed P/E ratios, reflect more pragmatic definitions of earnings. It is well known that differences in accounting methods have a significant impact on earnings per share but do not have any impact on share prices (the market sees through the effect of accounting differences). Generally, differences in earnings per share arise from differences in accounting methods which lead in differences in reported P/E ratios. Those firms employing depreciation policies with high charges have lower reported earnings per share (si nce depreciation is charged against revenues as an operating expense) and higher price earnings ratios than firms using straight line depreciation. Another factor that might influence the value of the companys reported P/E ratio is transitory changes in earnings. Beaver and Morse (1978) at a later study realised that the observed spread of P/E can be explained by the difference between equilibrium and actual earnings. Changes in earnings which are of temporary nature will not lead to proportionate change in the share price but to higher P/E ratio if negative transitory earnings occur and lower P/E ratio if positive transitory earnings occur. As a result, firms with low earnings will have high P/E ratios, without being growth firms at all. QUESTION 2 b) The sample of shares chosen to discuss and explain the possible reasons for the differences in the reported price-earnings ratio belong to the banks operating in the United Kingdom. It is important to choose companies that are in the same industry since this is the only way that P/E ratio analysis can have any significant comparable meaning. The data gathered are presented in the table below: BANK SHARE PRICE EPS P/E HSBC 662.7p 63.43p 10.4 times Royal Bank of Scotland Group 44.66p 3.4p 13.1 times Lloyds Banking Group 62.88p 6.10p 10.3 times Barclays 315p 34.99p 9 times Price earnings ratios were calculated based on the companies current share price and the estimated earnings per share for year 2011. P/E ratios calculated this way are known as forward price earnings ratios. Forward P/E ratios can give investors a more meaningful result than do trailing P/E ratios that are calculated by dividing the current share price by the trailing earnings per share for the last 12 months. Trailing P/E ratio is a historic measure while forward P/E is more useful and informative. After all, it is the future that counts; you are paying what the company will do in the future rather than what the company did in the past. Another reason that forward P/E ratios are used in this case is that the P/E for Lloyds could not be calculated by using EPS of the past 12 months because the firm had a bad year. Lloyds suffered a loss of 0.5p per share and calculation of P/E based on this figure would give a meaningless result. The figures presented at the table above suggest that the market has more confidence in the ability of RBS to continue increasing its earnings, but at the other side it believes the outlook for Barclays is unpromising. A high P/E ratio indicates that investors are paying more for each unit of earnings, so the stock is more expensive compared to those stock with low P/E ratios. The P/E ratio is commonly used to assess the level of confidence investors have in a company. It represents the markets view of the companys growth potential. A high price-earnings ratio indicates that investors have a high level of confidence in a companys future prospects. As we can see from the table presented, RBS has the highest price-earnings ratio, indicating that investors of the Banking sector have a high level of confidence in the companys growth potential prospects, it might equally be considered to be overvalued depending on prevailing market circumstances. RBS has a P/E ratio of about 13, implying that investors are currently willing to pay 13 for every pound of earnings RBS generates. Similarly, Barclays P/E ratio of around 9 implies that investors are currently willing to pay 9 pounds for each pound Barclay makes. For a different perspective, try flipping the P/E ratio to an E/P ratio, commonly referred to as the earning yield. Like a yield on a bond, this number shows a companys annual earnings as a proportion of its market value. Buying one share of RBS at 44.66p, with EPS 3.4p equates to an earnings yield of 7.6% (3.4p divided by 44.66p). For Barclays, the earning yield is 11.1%, because each share, currently trading at 315p is expected to generate a 34.99p in earnings per share. In long run, Barclays investors theoretically should earn a better rate of return than RBS investors for each pound invested. Yet the true outcomes could be different. The question that arises is whether the difference in P/E ratios alone makes one company a better investment than the other. Fundamental problems exist with the P/E ratio. First, the share price (P) doesnt consider debt since it is the equity price of a business. That is fine with companies without debt, like Google or Microsoft but not for the companies chosen. For instance, business with a market cap of 5 billion, with 1 million of net debt on the balance sheet, has an enterprise value of 6 billion. If this company earns 500 million in profit in a given year, the P/E ratio will be 10; but in reality, investors should see 12. The logic embodied in the conventional wisdom that high P/E ratios are good and low P/E ratios bad, is given by the dividend growth rate equation at which dividends (D) is expressed in terms of EPS (E) and retention ratio (b). The firms required rate of return r, can be given as follows: where i is the firms expected rate of return on future investments. From this equation is obvious that for any given r and b, the smaller the fraction [E1/P0] is, the larger i must be. Since [E1/P0] is the inverse of the P/E ratio, a small [E1/P0] corresponds to a high P/E ratio. Therefore, all else being equal, the higher the P/E ratio, the higher must be the expected rate of return on future investments; or, more simply, a high P/E ratio such as RBSs corresponds to good future investment opportunities, while Barclays with the lowest P/E ratio doesnt correspond to good future investment opportunities. Remember the P/E ratios are calculated based on estimated (average) earnings per share. But actual values almost never equal the average. A firm can have a very high P/E ratio during a bad year and a very low during a good year, yet in both cases, the firm may not have changed fundamentally. A high P/E ratio of 13.1 times for RBS is the result of low earnings (3.4p) rather than high expected rate of return on future investment. Note that RBS with the s mallest share value (44.66), has a P/E ratio that is the highest due to very low EPS, the smallest of all companies. The conventional wisdom about P/E ratio can be altered also by the possibility that earnings are not reflecting the actual outcome. For example, a land sold would create large profits due to the large difference between its historic cost listed on its balance sheet and the current market value. Or, the firm recognizing a bad debt that has existed for several years. Another possibility that can alter the conclusions about P/E ratios is changes in the firms accounting procedures. For example, a change of how the firm estimates its inventory, from the First-in-First-out basis (FIFO) to the Last-in-First-out basis (LIFO), lead to a decrease of the firms reported earnings in times of inflation. A change in the measure of earnings can cause a change in the P/E ratio that really indicates nothing new about the value of the firm. It can also be suggested that risk will influence the P/E ratio to the direction of influence needs careful consideration. Responsible for differences between the reported P/E ratios is also the expected growth and the way it depends in part on the level of investment and in part on the profitab ility of the investment. Specifically, one can conclude that a lot more information is needed than just the P/E ratio to estimate the value of a share of stock. QUESTION 3: Rights Issues QUESTION 3) a) i) Almost all quoted companies in UK that wish to raise money do so by means of a right issue. A right issue offers existing stockholders the right to buy new shares in proportion to their existing holdings. Rights issues allow stockholders to maintain their interest or proportionate share, in the ownership of the company, by ensuring that new shareholders are not brought in the company to the disadvantage of existing shareholders. Existing shareholders can exercise or sell their rights to other investors who would like to subscribe to the issue. Specifically, RBS wish to raise 12 billion of new equity capital and will do so by means of a rights issue. RBS shareholders are invited to subscribe to the right issue with an entitlement of 11 new shares for every existing 18 shares they hold at an issue price (PS) of 200p. The subscription price the price of the new shares is pitched below the current market price of 372.5p (P0). The discount offered as an inducement to shareholders to subscribe to the new issue is equal to approximate 46.31% (d). The 200p subscription price is calculated as given below: Once RBS decided on the level of funds (F) to be raised and the subscription price (PS), the number of new shares (ÃÆ'Ã… ½Ãƒ ¢Ã¢â€š ¬Ã‚ N) to be issued can be calculated quite easily: 12 bil / 2 = 6 billion of shares And once the number of new shares to be issued is known, the number of shares [N(R)] which an investor must hold to be granted one right can be calculated: The number of shares outstanding prior to the right issue (N0) must also be calculated in order to determine the ex-rights price. The determination is given below: The ex-rights price will be a weighted average of the pre-issue price and the subscription price: the weights being given by the ratios of the number of pre-issue shares to the total number shares outstanding following the issue: So, 3.07 The market value of a right [V(R)] depends on the difference between the subscription price (PS) and the expected price of the share following the new issue (PX). 1.07 QUESTION 3 a) ii) Rights issues are made at a discount, partly to make them look attractive and plus encourage stakeholders to subscribe, and partly against the risk of a fall in the market price during the offer period. Whether to invest in the rights or to sell them is the best choice for an investor will be analyzed furthermore. Assuming that a shareholder owns 900 shares of RBS, through the rights issue he can buy 550 shares at 200p (11 new shares for every 18 existing). Wealth Effects: the initial wealth with 900 shares at value P0 = 3.72 is: Initial Wealth = 900 * 3.725 Invest in the rights: This will happen only if the shareholder has the resources to acquire the additional shares and believes this is the best way to invest his money. Moreover a shareholder may invest in the rights because there are bi stamp or duty brokers commissions payable, and the desire to maintain ones existing share of voting power. Value of new investment = 3,352.5 + 1,100 = 4,452.5 The value of investment at the ex-rights price will be: Value of investment at PX = (900+550 shares) * 3.07 = 4,452.5 Thus, the impact on the shareholders wealth will be 0. Sell the rights This will happen if the shareholder wants to maintain his existing investment in the company in value terms. In the beginning the shareholder will lose from the fall of the share but he will cover from the loss through selling the rights. If the shareholder sells the rights, the value of his share at the ex-rights price will be: Value of shares at PX = 900 shares * 3.07 = 2,763 The declines in the shareholders wealth will be: Decline in shareholders wealth = 3,352.5 -2,763 = 589.5 The amount that the shareholder will acquire from the sale of the right at VR = 1.07 will be: Value from sale of the right = 550 shares * 1.07 = 589.5 Thus, the impact on the shareholders wealth will be 0 From the above analysis it is obvious that the shareholder wealth remains unchanged after the rights issue ether if e invests in the rights or sells the rights. The wealth of the shareholder will change only when the new issue leads to the re-appraisal of the firms value. This happens because issue of new shares at a discount leads to the fall in the value of existing shares thereby offsetting the value of the right. QUESTION 3) c) The Royal Bank of Scotland (RBS) announced a rights issue in order to raise 12 billion, which is considered the largest UK equity issue at that time. Under the terms of the rights issue, 11 new shares will be offered to existing shareholders for every 18 shares they hold. The subscription price is pitched well below the current market price of 372.5p. The discount offered as and inducement to shareholders to subscribe to the new issue is equal to 46.13%, well above the conventional level o f 15 to 20 per cent. The discount is pitched at this level in order to assure that the subscription price of 200p [372.5 (1-1.46310)] will remain below the market price over the offered period. The size of the typical discount drifted upward since the stock market at that time became more volatile and because of the size of funds needed to be raised. At first sight it might appear that the rights issue mentioned above is an attractive proposition for shareholders. The right issue allows the shareholders to increase their holdings of shares in the company at a discounted price, but a closer look at the mechanics of a rights issue reveals that it leaves the wealth of the shareholder unchanged, because the value of the existing shares falls, and this fall offsets the gains provided by the subscription. If the market price of the shares of RBS remains sufficiently above the subscription price of 200p the issue is likely to be successful, otherwise underwriters guarantee to take up any shares which the shareholders decline to acquire. Specifically, in the case of RBS, the bank agreed with its lead banks that fees would be 1.75 per cent of the proceeds of the average issue. These investment banks that lead the issue will only absorb some of the risk since most of it is passed onto the sub-underwriters of other merchant banks and institutional investors such as insurance companies for a fee of 1%. The question that arises is whether the company will be obtaining value for money for the underwriters fee of 1.75 per cent of the proceeds of the issue. In later study, Marsh (1980) found out that underwriting is highly profitable on an ex post basis. In 671 rights issues, only 35 led to losses with an average loss of 4.2%. In the case of RBS, the underwriters were left with unsold shares of less than 5 per cent since 95.11 percent of the shares offered had been taken by the investors. The remaining 299.4m shares were sold at profit by the underwriters, at a price of 230p a share, raising an additional 688.6m (299.4 m sha res times 2.3p) As Merret, Howe and Newbould (1967) comment in one of their first studies, the underwriting charges in the case of rights issues seems somewhat excessive for the minimal risks actually borne bye the underwriters. To incorporate the effects of risk mentioned above the underwriting contract should be viewed as a put option (Marsh 1980). RBS, the issuing firm is in the same position as an investor holding a put option, while the underwriter of the right issue is considered as the writer of a put option. The potential losses or gains of the underwriter are equal to the potential gains and losses of the issuing firm. Marsh found that the cost of underwriting produced an average excess return to the underwriters of 0.7 percent and only in 14% out of 539 underwritten issues the value of the put option element of the underwriting agreement appears to be greater than the fees charged. It seems logical to conclude that underwriting fees are used to compensate for other services provided by the merchant banks, for which explicit charge is not being made. Underwriting cannot be considered too expensive if this is the case. The profit and loss associated with an underwriting agreement as a function of the share price are illustrated in the figures below: (a) PROFIT LOSS FOR RBS UNDERWRITING FEE (+) profit Market share price (-) loss 0 (b) PROFIT LOSS FOR UNDERWRITERS UNDERWRITING FEE (+) profit (-) loss 0 QUESTION 3) d) Alex Porter of Collins Stewart views that investors should take up the rights offered by RBS because buying shares at 200p is incredibly cheap since the 2009 estimated earnings per share of 37p and a price-earnings of 9 indicate that the price of share will be raised to 333p (374p x 9). RBS rights issue seems as an attractive proposition for shareholders since they are given the right to subscribe to additional shares at a discount above the conventional level of 15% to 20%. On the other hand, RBS has employed a large price discount (46.31%) and faces the risk of the dilution of earnings, dividends and assets. The lower the subscription price the larger the number of shares that must be sold in order to raise the fund required by the company. In the case of RBS, 6 billion shares must be issued in order to raise 12 bil of equity capital. There is a fear that the increased claims of the firms earnings, dividends and assets will lead the stock market to react adversely to this dilution. An adverse reaction implies that the investors are unable to differentiate between nominal and real changes and that the stock market is inefficient. The fall in earnings per share, as more shares have to be issued to raise the funds required, will be matched by the fall in share price. The fall in share price will be compensated by the increase in the number of shares, leaving the earnings yield of the stockholders overall stake in the company unchanged. As a conclusion I believe that Porters statement is misleading and creates a misunderstanding, since it implies a share price of 333p which is far greater than the expected ex-rights price of 307p calculated. The belief that the price of share will have a future value of 333p is very optimistic since the financial crisis of 2007 is considered by most economists the worst financial crisis since the great Depression to the 1930s. There is a fear that the European banking system may collapse as did large financial institutions in the United States. Specifically, S P no longer considers the UK banking sector to be one of the lowest risk and secure banking systems because of the countrys weak economic environment, the reputational damage experienced by the banking industry, and high dependence on state support programs. The risk profile of UK banks is affected by anticipated system-wide, domestic non-performing and impaired loans that will remain high throughout 2009 and 2010, linked to high levels of household and corporate debt. The uncertainty surrounding the banking industry must be taken into consideration in analyzing the statement of Porter which is in my opinion very optimistic. One, b efore deciding buying RBS shares offered at 200p, should consider whether RBS will remain in the following years, structurally strong, and a business that will continue making profits under the conditions discussed above. QUESTION 4: Options QUESTION 4) a) An option gives the holder the right to buy or sell on asset by a certain date for a certain price. The option that gives the holder the right to buy is called call option and the one that gives the holder the right to sell is called put option. The price in the contract is known as the exercise or strike price (x), and the date in the contract is known as the expiration, expiry or maturity date. The fact that distinguishes options from other contracts (futures of forwards) is that the holder does not have to exercise the right that the option gives him. For an option contract an investor must pay an up-front price, known as the option premium (c). In the specific question we are asked to explain why call option traded on Marks Spencer shares are trading in November than those trading in September. There are many factors that influence stock option prices, and the most important are given below: The current stock price (S0) The strike price (x) The time to expiration (T) The volatility of the stock price (ÃÆ' Ãƒâ€ Ã¢â‚¬â„¢) The risk-free rate (r) The dividends expected during the life of the option Specifically in order to give an adequate answer to the question involved, we will discuss what happens to the call option prices of Marks Spencer when one of these factors changes (the time to expiration) while the others remain fixed. Options are referred to as in the money, at the money or out of the money. A call option is in the money when sk, at the money when s=k, and out of the money when sk. Clearly the option will be exercised when it is in the money and the payoff will be the amount by which the stock price exceeds the strike price (s-x0), which is called the intrinsic value of an option. As the stock price increases, than call option becomes more valuable. Therefore the longer the time that a call has to run to maturity, the greater the scope for the price to rise above the exercise price. The probability to notice big variation between the share price at expiration and the strike price is higher, the longer the maturity period of the option. Another important element is that in call options there is a limit to what can be lost which is the call premium while the gains are unlimited. In other words, gains and losses are not symmetrically distributed for a call option. Although European call options usu ally become more valuable as the time to expiration increases, this is not always the case. Consider two European call options on a stock: one with an expiration date in one month, the other with expiration date in two months. If a very large dividend is expected in six weeks, this expected dividend will cause the stock price to decline, so that the short-life option could be worth more than the long-life option. QUESTION 4) b) A straddle is an option strategy that involves taking a position in both calls and puts on the same stock. Specifically, in a straddle, an investor buys a call and a put option which have the same exercise price and expiration date. When the share price at the time of expiration (ST) is greater than the strike price (x), the call option is exercised. The put option is exercised when the strike price (x) is greater than the stock price (ST). The exercise price of 210p has a call premium in November equal to 24.5 (C0) and a put premium equal to 22 (P0). The amount paid from the investor for this specific combination called straddle will be equal to: C0 + P0 = 24.5 + 22 = 46.5 The profit pattern is shown in the following table: Action ST CFT from Call CFT from Pull P/L CF0+CFT Exercise Put 130 0 (210-130)-46.5 33.5 Exercise Put 163.5 0 (210-163.5)-46.5 0 Exercise Neither 210 0 0 (46.5) Exercise Call 256.5 (256.5-210)-46.5 0 0 Exercise Call 290 (290-210)-46.5 0 33.5 Long Straddle -24.5 -46.5 -22 Profit or loss Put only Call only 163.5 210 256.5 Straddle ST This specific long straddle strategy will yield a profit if ST is above the upper breakeven point of 256.5 and below the lower breakeven point of 163.5. Between the two breakeven points (16.5, 256.5) the specific strategy will yield loss with a maximum value of 46.5. An investor might consider worthwhile to invest in a straddle if he believes that there are likely to be big movements in the stock price, and these beliefs must be different from most of the other investors. A straddle seems a natural trading strategy in the case that a big move is expected in the companys stock price because there is a takeover bid for the company or the outcome of a major lawsuit involving the company is about to be announced. In other words, someone may take a long straddle position if he thinks the market is highly volatile, but does not know in which direction it is going to move. This position is a limited risk a purchaser of a straddle may lose the cost of both options but there is an unlimited profit potential. In contrast, a short straddle position is highly risky because the potential loss is unlimited, while profitability is limited to the premium gained by the initial sale of the options since short straddle is a strategy that involves a simultaneously sell of a put and call option. QUESTION 4) c) A zero sum game is one where for every winner you must also have a loser. In other words for every person who turns a profit someone else must suffer a corresponding loss. Financial markets offer many examples of zero sum games. For example the writer of an option can only gain what the holder loses and vise-versa. Specifically, the profit of the writer is a mirror image of the holders loss. This situation is given in the following diagram: Profit graph for a call writer and investor Investor Buyer Long position Seller Writer Short position Profit Loss -c +c ST X When the share price at expiration (ST) is lower than the exercise price (x), the call option will not be exercised by the investor. The investor of the particular option will suffer a loss equal to the call premium (-c). This particular loss will be the profit to the writer of the call option (+c). On the other hand, if the exercise price (x) is not above the share price at expiration the profit of the investor [ST (x+c)] will be the loss of the writer [(x+c)-ST]. All the above are summarized below: Share price Investor Writer Both PL STX -C0 +C0 Æ’Ã ¢Ã¢â€š ¬Ã‚   STX ST-(X+C) [-ST+(X+C)] Æ’Ã ¢Ã¢â€š ¬

The Headstrong Historian By Kurt Vonnegut - 1043 Words

A short story about a dystopian future in which everyone is equal and a short story about a Nigerian family reclaiming their history, on the surface, seem unalike, but Kurt Vonnegut’s â€Å"Harrison Burgeron† and Chimanda Ngozi Adichie’s â€Å"The Headstrong Historian† bear a strong resemblance when further examined. â€Å"Harrison Burgeron† and â€Å"The Headstrong Historian†, while seemingly different stories, share many similar themes and ideas. While â€Å"Harrison Bergeron† mainly considers people’s concept of equality this is not the central theme of â€Å"The Headstrong Historian†. They both delve into the theme of oppression. Vonnegut wrote â€Å"Harrison Burgeron† in 1961 while Adichie wrote â€Å"The Headstrong Historian† in 2008. Vonnegut’s short story was written in the midst of the Cold War, suggesting a potential connection to the ideas of communism and socialism. Adichie is a writer famous for her work in which she closely examines African culture. On a surface level, these stories could not seem more different. â€Å"Harrison Burgeron† and â€Å"the Headstrong Historian† obviously have completely different settings. The beginning of â€Å"Harrison Burgeron† informs the reader that it takes place in the United States in the year 2081. The majority of â€Å"The Headstrong Historian† takes place in West Africa in the late 1800s and early 1900s. â€Å"Harrison Burgeron† takes place in a society where change seems to be nowhere in sight. In â€Å"The Headstrong Historian†, Nwamgba finds herself in â€Å"a world that increasingly made no

Mental Health in Elderly People in Dandenong-Samples for Student

Question: Discuss about the Mental health in elderly people in Dandenong. Answer: Introduction The paper presents the clear view of the mental health and social isolation in elderly people in Dandenong. Greater Dandenong is the culturally diverse municipality in Victoria. The paper provides the comprehensive and detailed description of the health issue, the demographics of the population and those affected by the chosen health issue. The paper reviews and describes the two real needs assessment reports. It also includes the organization that carried out the assessment, specific target population, and detailed description of the findings. Further, the paper highlights the various needs assessments tools to be used, different groups to be sampled and sample size. With each of tool the questions to be asked will also be detailed in the paper. Out of all the needs assessment tools one will be drafted for survey or interview. For the draft survey and interview, the design of the tool, the type of data collected will be explained. Both the original and the revised tools will be atta ched. The paper further gives a brief inventory on the key services and other relevant infrastructure pertaining to geographic target population and health issue in the tabular form. The facts and information related to the subject will be supported with credible resources. Overview of the health issue in the target population- Greater Dandenong is the culturally diverse municipality in Victoria. The estimated population of the 164, 000 in 2015. According to the Victorian Population Health Survey, 15.5% of the older residents in Greater Dandenong experience high level of psychological distress when compared to 11% of the Victorian residents (Greaterdandenong.com 2017). Similar survey conducted on the young and the elderly showed that the greater proportions of old people lack trusted emotional support in their life. Therefore, they had unfavourable psychological development. The adolescents mental well being reports (2009) showed that 30.6% of the adolescents are not satisfied with their quality of life and 55.3% of them are without positive psychological development. This is manifested as mental health disorder in older adults (Greaterdandenong.com 2017). Among the preparatory pupils 37% of them were found developmentally vulnerable. In social aspects, 17.5% of children were developmentally vulnerable, 12.2% in emotional aspects, 11.2% in the language and cognitive aspects. Therefore, these people do not have healthy ageing. Thus, mental health issue in elderly is highly prevalent. The broad categories of the mental disorders documented by the local survey in Great Dandenong includes anxiety disorders (11% of the males and 18% females), substance abuse conditions (7% males, 3% females) (Kearns et al. 2015). Other mental health disorders profoundly observed are- Alcohol dependence, bipolar effective disorder, post-traumatic stress disorder, panic disorder, generalised anxiety disorders, psychosis, and obsessive compulsive disorder (Renzaho and Oldroyd 2014). Mental health disorder has been found to be highly prevalent among older women, people without high education attainment, unemployed individuals, homosexuals, divorced couples, people with poor physical health, or those heads of one parent families (Kearns et al. 2016). According to the 2013 National Drug Strategy Household Survey in greater Dandenong showed that out of 24000 Australians aged 14 and more 42% were involved in illicit drug abuse in their lifetime and 15% in the previous year. The rate of suicide is high in this city and is most prevalent among the 20-24 years old males (Ddacl.org.au 2017). The number of the Indigenous population counted by the Census in this sector was 3,825 in 2011. The number has increased by 5000 in the last five years. The general health of the people is comparatively worse than the non-Indigenous Australians. This paper focuses on the mental health of the Indigenous population in Great Dandenong and associated social isolation. Mental health disorders are highly prevalent among the elderly in Indigenous Australians. The mortality rate due to the mental disorders among the Indigenous Australians is 2.5 times higher than the non-Indigenous Australians (Greaterdandenong.com 2017). The 2011 Index of Relative Socioeconomic Disadvantage, rated Greater Dandenong as the most disadvantaged municipality in Victoria. The survey measured unemployment, educational levels, incomes, home ownership, English fluency, and other considerations (Ddacl.org.au 2017). The key contributing factors for the prevailing mental health issue in elderly includes relatively low incomes, poor employment level, and low educational attainment. These factors add to unfavourable health condition and accompany target populations social disadvantage. The social isolation among the young adult population in the Indigenous community is attributed to leave school earlier, less favourable early school development, high rate of absenteeism, less often attend university and increasing rate of disengagement from the employment and education. These factors decrease the possibility of employment in later life and social disengagement (Ddacl.org.au 2017). Review of the real needs assessment reports Need assessment plan Need assessment tools Strategies Sample group Type of information collected Survey (quantitative tool) (Schilling 2014) Printed questionnaire Online survey Create a draft full survey and then try on test group, revise if necessary Administer the survey and tabulate results Target broad area that is community Large sample size (more than 3000 people) and more representative group of people Honest and objective description of needs It develops quantitative data that requires statistical analysis Interviews (qualitative tool) (Schilling 2014) Need to build strong rapport with the participants Must have list of themes to structure the conversation Develop an interview script Calm and comfortable environment Video and audio-recording with consent Relatively small number of people and cannot encompass an entire community but a small section of it. Usually segment of population is needed. Provide insights into individual perspectives. It develops non-numerical data. Focus groups (Stewar and Shamdasani 2014) Open ended questions- right from general to specific Trained assistant moderator- minimal interaction with group Not more than eight individuals Homogeneous group- similar years, age, gender Information on individual preferences through group dialogue and face-to-face interaction with participants Observational studies (Von Elm et al. 2014) Primary questions will be the focus of observation Note taking material while observing the activities Photo-taking for richer information Develop an observation schedule to capture data at different times of the day. Need to have coding scheme to document behaviours A small research team Actual Information can be textual descriptions to or drawings of a space or coded marking of template. Brief inventory- Primary care mental health needs assessment Tool Type of information Target population Original Revised Interview (Structured questionnaire- both close ended and open-ended) Mental health problems in primary care and care providers perspectives Stakeholder in XZ mental health organisation in Dandenong. Sample population- stakeholder interviews 1.What is your work? 2. How do you refer elderly patients? 3.Where and how do you refer patients? 4. Which group of elderly patient do you target? 5. Do you provide counselling service? 6. What is the part of the area you cover? 7. What are the patient pathways you cover? 8. What are your facilities? 1.What is the role of organisation? 2. How are older patients referred? 3. D o you refer patients? Yes No where and how? 4.Who are the target group of elderly patient? 5. What does counselling or intervention consist of? Who is qualified to do this? 6. Is mental health the part of the area of work you cover? 7. Are you aware of any patient pathways? Yes No 8.What facilities do you provide? Does users want to use them? Key services in Dandenong The Greater Dandenong Community Health Service promotes the health and the wellbeing of the vulnerable and the diverse individuals in the community. The services collaborate with organisations, communities and individuals. The people in need and with poor health status access services. Confidentiality of the health care is mentioned. Services offered mainly includes counselling, health information sources, psychology services, community health nursing, mental health education, physiotherapy, occupational therapy, life skills program i.e parenting and health ageing. These services also provide medical interpreter and case mangers. Overall, the city of Dandenong is not the direct mental health service provider. The council provides the services to promote mental health. There are four Community Mental Health Centres and an Early Psychosis service. Among the specialist interventions cognitive behavioural therapy and family group work are prominent (Lee et al. 2015). References Alarcon Manchego, P., Knott, J., Graudins, A., Bartley, B. and Mitra, B., 2015. Management of mental health patients in Victorian emergency departments: A 10 year follow?up study.Emergency Medicine Australasia,27(6), pp.529-536. Ddacl.org.au, 2017.Dandenong and District Aboriginal Cooperative Ltd.. [online] Ddacl.org.au. Available at: https://ddacl.org.au/about-the-co-op/ [Accessed 25 Aug. 2017]. Greaterdandenong.com, 2017.Health and Wellbeing in Greater Dandenong. [online] Greaterdandenong.com. Available at: https://www.greaterdandenong.com/document/26113/healh-and-wellbeing-profile [Accessed 25 Aug. 2017]. Greaterdandenong.com, 2017.Statistics and Data - City of Greater Dandenong. [online] Greaterdandenong.com. Available at: https://www.greaterdandenong.com/document/42/statistics-and-data [Accessed 25 Aug. 2017]. Kearns, N.P., Shawyer, F., Brooker, J.E., Graham, A.L., Enticott, J.C., Martin, P.R. and Meadows, G.N., 2016. Does rumination mediate the relationship between mindfulness and depressive relapse?.Psychology and Psychotherapy: Theory, Research and Practice,89(1), pp.33-49. Lee, J., Daffern, M., Ogloff, J.R. and Martin, T., 2015. Towards a model for understanding the development of post?traumatic stress and general distress in mental health nurses.International journal of mental health nursing,24(1), pp.49-58. Renzaho, A.M. and Oldroyd, J.C., 2014. Closing the gap in maternal and child health: a qualitative study examining health needs of migrant mothers in Dandenong, Victoria, Australia.Maternal and child health journal,18(6), pp.1391-1402. Schilling, N., 2014. Surveys and interviews.Research methods in linguistics, p.96. Stewart, D.W. and Shamdasani, P.N., 2014.Focus groups: Theory and practice(Vol. 20). Sage publications. Von Elm, E., Altman, D.G., Egger, M., Pocock, S.J., Gtzsche, P.C., Vandenbroucke, J.P. and Strobe Initiative, 2014. The Strengthening the Reporting of Observational Studies in Epidemiology (STROBE) Statement: guidelines for reporting observational studies.International Journal of Surgery,12(12), pp.1495-1499.

Justice For All (Except Persons Of Japanese Descent) Essays

Justice For All (Except Persons Of Japanese Descent) Justice for All (Except Persons of Japanese Descent) America Land of the free and home of the brave. Land of the free Land of the free Funny that the land of the free would steal away the lives of 119,000 individuals simply because they looked different. Nothing like good old irony to bring a country together. During the late 1800s, there was a large rise in the immigration of Japanese to the U.S, much to the dismay of many American citizens. The Japanese have long been discriminated against in the U.S. People have thought they are sly, treacherous, cruel In other words, they were strangers. People, as a whole, fear the unknown. Individuals of Asiatic descent have been so singled out for so long for one reason: they look different. Almost 200,000 Japanese and Japanese Americans were evacuated and relocated during World War II. Reasoning behind this? Although there was no proof of any of this, it was said that the farmers, for example, were charged with poisoning their vegetables and with planting their tomatoes in such a pattern that they pointed to U.S. military objects from overhead. At the time, the government claimed that the threat was real and that this action was pure military necessity. Now we all know better. On December 7, 1941, the Empire of the Rising Sun, more commonly known as Japan, launched an air attack on the naval base at Pearl Harbor. Many people feel that this is what provoked President Roosevelt and our government to evacuate. Not so. Did you ever stop and think things through? I mean, really think things through? Franklin Roosevelt signed Executive Order 9066, which allowed for the evacuation of all West Coast individuals of Japanese ancestry, on February 19, 1942 a mere ten weeks after the bombing on Pearl Harbor. Could this nation really assemble enough living space for 119 thousand people in ten weeks? That seems a little far-fetched. Now that Ive got your attention, lets take this from the beginning. Japan enters the war. Almost immediately, the U.S. governments Federal Bureau of Investigations gets to work, looking for any suspicious individuals of Japanese heritage who could possibly mean sabotage. Thought to be a threat because they were so close to the enemy and they could communicate, Japanese on the West Coast were already seen as suspicious. 7 and 8 December, 1941 - Presidential proclamations were sent out, dealing with the control of and subsequent action against any aliens suspected of hostile intent or of action against national security. These proclamations were sent out the day of the bombing the same day. 10 December, 1941 - A report was made by a Treasury Agent to the Army authorities that, an estimated 20,000 Japanese in the San Francisco metropolitan area were ready for organized action. How could the bombing of Pearl Harbor possibly have had any effect on Executive Order 9066 when there were already orders out to discriminate? 26 December, 1941 - In a phone conversation between Major General Allen Gullion, the War Departments Provost Marshall General, and General John L. DeWitt, Commander of Western Defense Command, DeWitt says: If we go ahead and arrest the 93,000 Japanese native born and foreign born, we are going to have an awful job on our hands and we are liable to alienate the loyal Japanese from disloyal Im very doubtful that it would be common sense procedure to try and intern or intern 117,000 Japanese in this theater 30 December, 1941 Attorney General authorized the issuance of warrants for search and arrest in any house where an alien lived upon representation of an FBI agent. There had to be reasonable cause to believe that there was contraband on the premises. 5 January, 1942 The San Francisco conference takes place. General DeWitt announces that he can have the boundaries of the restricted areas fixed by the 9th. It is not until the 21st that he sends out his first list of names to Washington to be reviewed. Arizona followed on the 24th, with Oregon and Washington on the 31st. 4 February, 1942 The federal governments Office of Facts and Figures conducts a survey on the public opinion of