Supply Chain in Netflix Essay Example | Topics and Well Written Essays - 2500 words

Supply Chain in Netflix - Essay Example Here, the idea came of starting a similar business and bring more diversity and customer friendly policies (New Word City, 2010). The organization’s website was launched in April 1998. The new online version came with a more traditional pay-per-rental model. Customers were charged $4 dollars as rental fee and $2 as postage fee. At the end of 1999, Netflix introduced a monthly subscription concept. The single rental model was dropped in early 2000. Since then, the company has established a reputation on the flat-fee unlimited rentals business model. The model does not have late fees, due dates, per title rental fees or handling fees. The company maintained its extensive, personalized video recommendation system based on reviews and ratings by its customers. Netflix has played a vital role in enhancement of independent film distribution. The organization announced its billionth delivery at the beginning of 2007. By 2009, Netflix was offering more than 100,000 collections on DVD. During this time, the company had more than 10 million subscribers. In 2011, Netflix announced that it had reached more than 23 million subscribers in United States and 26 million all over the world. Revenues had gone in excess of $1.5 billion (Laseter and Elliot, 2012). The video entertainment industry is very competitive. Competition is increasing as new realizations are being established. Numerous companies are joining the industry based on the returns involved. The markets involved include hotels, airlines and theater video entertainment. The market is segmented into several strategic groups. This include sales, brick and mortar rentals, online rentals, DVD vending kiosks, video on demand services and mail-delivery services. Technological advancement is bringing various changes in the industry. The rental portion available from physical rentals is transforming to digital rentals (Sehgal, 2011). This is being provided via streaming channels that are connected through game consol es, set-top boxes and computers. All these applications work to bring the steaming aspect on consumers’ televisions. As a result, viewing is made easier, interactive and enhances availability at all times. Consumers have been divided into two segments. These include convenience consumers and needy consumers. Convenience consumers are young, watch videos when they can and use technology to access various titles. One the other hand, needy consumers are older and less prone to using new technologies. Needy consumers are subject to watching specific programming. Traditional home video entertainment is reaching stasis. For this reason, companies involved in the industry should concentrate on the streaming aspect. This will help in immersing substantial profits, in this competitive industry (Minis, 2011). Netflix is facing stiff competition from other players in the industry. New entrants are coming with new ideologies that are taking the industry with a storm. They are building on the loopholes that exist in at Netflix. The company needs to review its business models so as to operate profitably for as long as possible. Supply Chain Description Netflix has a varied supply chain. This is based on the nature of operations being conducted. Various ways have been diversified to help reach the consumers. Among the supply chain used by the company, is the internet and postal system. The company has instituted online DVD rentals. Members only need to chose their desired collections

NHS Development Since 1948 Essay Example | Topics and Well Written Essays - 1000 words

NHS Development Since 1948 - Essay Example This is good because it will ensure that clinical standards are met and there are processes to ensure continuous improvement backed by a new statutory duty for quality in NHS trusts. The Commission for Health Improvement (CHI) has been established to support and oversee the quality of clinical services locally, and tackle shortcomings. It intervenes by invitation or the Secretary of States’ direction where a problem has not been gripped. The focus is given on key areas such as life long learning, risk management, performance indicators, evidence-based practice and professional self-regulation. Life long learning is a positive step, for the NHS staff will have the opportunity to continuously update their skills and knowledge to offer the most modern, effective and high-quality care to patients. Likewise, risk management is required so that Trusts comply with the Trusts Risk Management Policy and the Health and Safety at Work Regulations 1992. This will certainly reduce hazards both for patients and staff. The use of performance indicators serves to highlight low or high achievement and to, therefore, raise questions about services provided. However, they represent only one of the several types of analysis. More detailed investigation of trends over time and the use of qualitative data should also be used. Evidence Based Practice is a good step for it will lead to a conscientious, explicit and judicious use of current best evidence in making decisions about the care individual patients.

The Us Foreign Policy Essay Example for Free

The Us Foreign Policy Essay The political norm â€Å"domestically earned and internationally achieved† can be attributed to the famous 25-year old American National Guard pilot Charles A. Lindenberg who was the first person to fly solo on his Spirit of St Louis Airplane non-stop across the Atlantic Ocean and landed at the Le Bourget Aerodrome in Paris on May 21st 1927 (Jantunen, 1998). Basically, the norm domestically earned and internationally achieved lays the chronicle of Lindenberg who then worked with the US Air force and Defense Department, wherein his famous voyage was patterned by the US’ foreign defense strategy in World War II during the 1930’s (Cole, W. , 1998; in Jantunen, A. , 1998). As a result, the US domestic affairs were able to cross international borders and foster foreign relations that eventually led to the creation of its foreign policies. The use and review of literatures will be the guiding methodology of this paper which will discuss the US’ interstate (domestic) and intrastate (international) affairs in view of evolving its foreign policy. Influences that shape US foreign policy The democratic processes involving the sovereign will of the people are the bottom-line of policy initiatives through legislation. On the other hand, situational factors primarily influence the sudden enactment of a policy. According to the book, ‘American Public Policy: An Introduction’, published in 2006 by Clark Cochran, Lawrence Mayer, T. Carr and N. Joseph Cayer, policies are classified according to purposes, types, and goods. Basically, the classification of a public policy plays a key role in promoting moral and social values. For example, if the classification of a public policy pertains to preserving domestic peace and order, it also results in the formation of international treaties against terrorism by allied governments. In other words, a policy has a dual role— in order to secure the interstate (domestic), there must be an intrastate (foreign) policy consistent with preventing the vulnerability of the people and state from potential external attacks or threats of terrorism. The 9/11 Tragedy objectively result in a large public influence that resolutely condemned and abhorred terrorism. In effect, the US Congress has legislated and enacted series of homeland defense and security policies that has presently empowered the National Strategy for Homeland Security Act of 2007. The enforcement of that policy works within the intrastate strategic framework, in which the scope of enforcement crosses international borders. In sum, it may be perceived that US foreign policy represents the domestic needs of the people or the interest of the state to uphold the economic resources and political affairs of the government. Moreover, the processes in creating US foreign involve various international perspectives. President’s formal and informal foreign policy making powers The Presidents formal and informal foreign policy-making powers today work two ways— first, the President being the Chief Executive, can veto a decree or enact orders having the formal constitutional mandate and second, he or she informally can influence ministerial function through the so-called â€Å"mandamus duty† [having extraordinary writ commanding an official to perform a ministerial act that the law recognizes as an absolute duty and not a matter for the officials discretion] as exemplified by the enactment of National Strategy for Information Sharing (NSIS) in year 2007 (E. O. 13356, 2006; Sec. 11; in NSIS, 2007). The formal and informal Presidential powers may be deduced as a combined political capability of the President that emphasizes the â€Å"political will† in enacting or rejecting policies that may be favorable or unfavorable to both political and economic affairs of the government. Moreover, these powers may be best described by the historical process of US foreign policy creation that can be traced in the Monroe Doctrine. Based on Steven W. Hook’s book, ‘U. S. Foreign Policy: The Paradox of World Power’, the National Security Act of 1947, which created the Department of Defense (DOD), the National Security Council (NSC), and the Central Intelligence Agency (CIA), provides an excellent example of how policy decisions are largely made from prior policy experiences. Hook pointed out that the combination of formal and informal political powers most likely becomes a personal preference on the political will of the president, in which today, according to Hook, the â€Å"Bush Doctrine† has supplanted the Monroe Doctrine that once opposed the European foreign policy. In short, Hook’s perception reflects the presidential formal and informal policy making powers today that subsist a culture of the United States foreign policy which is considered both moralistic and self-interested and which stems from geographical factors and colonial history (Hook, 2007). Significance of political terminologies Based on the interpretation of Roberta Tovey (2000), author of the article ‘Best Firms More Alike Than Different Around the Globe’, an adhocracy refers to an organization that lacks structure, which is opposite to a â€Å"bureaucracy†. In short, adhocracy pertains to the creation of a task group also called as â€Å"ad-hoc† (impromptu), which is a type of structure that can be found in creativity-based companies which are flexible as new projects arise. To cite the case of the â€Å"Watergate Scandal† implicating former US President Richard Nixon, the term â€Å"political questions† include the conduct of foreign policy, the ratification of constitutional amendments, and the organization of each states government as defined in its own constitution. The rule preventing federal courts from deciding such cases is called the political question doctrine (United States v. Nixon, 418 U. S. 683, 94 S. Ct. 3090, 41 L. Ed. 2d 1039; US-DOJ, 1974; in Legal Dictionary, 2008). During the time of former US President Harry Truman, the National Security Act of July 26, 1947 created the National Security Council under the chairmanship of the President, with the Secretaries of State and Defense as its key members, to coordinate foreign policy and defense policy, and to reconcile diplomatic and military commitments and requirements (US-Public Law 80; 253, 1947; in NSC, 2008). As cited from the US Public Law, the alliances of political personalities in US government agencies, the interest groups of lobbying organizations, and the legislative committee members with jurisdiction over a particular functional area of government policy are said to be â€Å"triangles strong as iron. The relationships are so politically powerful that it directly influence and interferes with the general interests in policy-making. Moreover, in a Presidential turn over ceremony (farewell speech) of US former President Dwight Eisenhower in 1961, he stated that â€Å"the immense military establishment and a large arms industry is new in the American experience that influence economic, political, even spiritual aspects felt in every city, every State house, every office of the Federal government†. Eisenhower defined the term â€Å"military-industrial complex† or MIC which refers to the US Armed Forces’ suppliers of weaponry, services, and civil government (Eisenhower, D. , 1961). Conclusion Based on the brief review of the US foreign policy, it may be concluded that it has earned domestic power and achieved international dominance. The presidential â€Å"political will† amidst public dispensation basically evolves and transforms the intrastate affairs. It may also be deduced that the political system develops these dominant powers result in foreign policies that could either be beneficial or detrimental to international boundaries. References Carr, T. , Cayer, J. N. , Cochran, C, and Mayer, L. , and (2006). ‘American Public Policy: An Introduction’.Thompson/Wadsworth Publishing, 8th Edition. ISBN: 0-534-60163-4. Hook, S. W. (2007) ‘U. S. Foreign Policy: The Paradox of World Power’. CQ Press, 2nd Edition, ISBN 978-0-87289-466-2. Retrieved 10 April 2008 from http://www. cqpress. com/product/US-Foreign-Policy-The-Paradox-of-World. html. Jantunen, A. (1998). ‘Developing for Peace: An Analysis of Charles A. Lindbergh’s Views on American Foreign Policy’. Retrieved 10 April 2008 from http://www. charleslindbergh. com/pdf/lindbergh2. pdf. Legal Dictionary (2008). ‘Political Question’. United States v. Nixon, 418 U. S. 683, 94 S. Ct. 3090, 41 L. Ed. 2d 1039, US-DOJ (1974). Retrieved 10 April 2008 from http://legal-dictionary. thefreedictionary. com/Political+question+doctrine. National Strategy for Information Sharing. (2007). ‘Information Sharing: Successes and Challenges In Improving Terrorism- Related Information Sharing’. Retrieved 10 April 2008 from http://www. state. gov/html. Roberta, T. (2000). ‘Best Firms More Alike Than Different Around the Globe’. Retrieved 10 April 2008 from http://www. msi. org. US Department of State (2007). ‘National Strategy for Homeland Securit

Islamic Equity Investment Risk and Return Behaviour

Islamic Equity Investment Risk and Return Behaviour Islamic equity investments deal with the application of Shariah in stock selection in fund management. Islamic equity investment is a new and emerging concept in fund management and posed a slow growth compared with a fast paced growth in Islamic fixed income Sukuk markets and Islamic banking in the current decade. However Islamic equity investments contain a significant potential to generate above average risk adjusted returns than conventional equity investment as discussed in this paper. The thesis argues about the risk returns behavior of Islamic equity investments by analyzing the risk return behavior of Karachi Meezan Index, an Islamic index traded at Karachi stock exchange, over the period of two and a half years. Karachi Stock Exchange 100 index and Karachi Stock Exchange 30 index was used as benchmarks to find out if there are any significant differences in the returns volatility of KMI30 and KSE 100. The complete period was also divided into bull and flat periods and eac h period is analyzed to further augment the research. Our findings provide strong evidence to reject the notion that Shariah Compliant investment perform poorly than conventional equity investments. In fact our finding supported the assumption that Shariah Compliant Equity Investments can deliver better returns than conventional investments given the same level of risk. Chapter 1 Introduction In the past few years there has been remarkable growth in the field of Islamic finance. New products are being developed on a consistent basis in capital markets which comply with the Shariah. The main distinguishing feature of Shariah Compliant Stocks is their low risk characteristics which has induced many risk averse investors into investment in Shariah complaint stocks and equity funds. According to Ernst Young’s 2010 Islamic funds investment report, currently there are approximately $52 billion fund assets under management in the Islamic fund industry which is still a small proportion of the total assets under global fund management which are worth $22 Trillion in 2010. Total Shariah compliant assets now exceed $1 trillion worldwide because of the fast faced growth in Islamic finance during the current decade. Currently Islamic funds only constitute about 5.5% of total Islamic finance investments which signifies the potential of growth in this industry in coming years. From July 2007 to Nov 2009, MSCI World Islamic Index outperformed the MSCI World Index Standard Core in terms of variability of returns which shows that Shariah complaint stocks generate more returns in high volatility period compare to conventional stocks. In an Islamic equity fund, the amounts are invested in the shares of Shariah complaint stock companies. The profits are mainly achieved through the capital gains by purchasing the shares and selling them when their prices are increased. Profits are also achieved by the dividends distributed by the relevant companies. It is obvious that if the main business of a company is not lawful in terms of Shariah, it is not allowed for an Islamic Fund to purchase, hold or sell its shares, because it will entail the direct involvement of the shareholder in that prohibited business. In September 2008, Karachi Stock Exchange with the collaboration of Meezan Bank launched a new index called Karachi Meezan Index comprising of 30 companies. The distinguishing characteristic of this index is its Islamic nature in which selected companies will be fully Shariah-complaint. Companies will be selected in the index based on their liquidity in the stock market along with compliance with Shariah principles. These Shariah principles are formulated by the Shariah advisory council of Meezan bank which comprises distinguishing Islamic scholars. The objective of KSE-Meezan Index (KMI) is to serve as a gauge for measuring the performance of Shariah compliant equity investments. It may also act as a research tool for decisions in strategic asset allocation according to Shariah besides tracking performance of Shariah compliant equities; its construction will increase investor trust and enhance their participation. Stock Screening Requirements for KMI-30 Index Shariah compliance of stocks shall be done under the guidance of qualified and reputed Shariah experts. For stocks to be Shariah compliant, it must meet ALL the six key tests given below. Business of the Investee Company: Core business of the company must be HALAL and in-line with the dictates of Shariah. Hence, investment in securities of any company dealing in conventional banking, conventional insurance, alcoholic drinks, tobacco, pork production, arms manufacturing, pornography or related un-Islamic activities is not permissible. Debt to Total Assets: Debt to Asset ratio should be less than 40%. Debt, in this case, is classified as any interest bearing debts. Zero coupon bonds and preference shares are, both, by definition, part of debt. Non-compliant Investments to Total Assets: The ratio of non-compliant investments to total assets should be less than 33%. Investment in any non-compliant security shall be included for the calculation of this ratio. Non-complaint Income to total revenue – Purification of Non-compliant: income the ratio of non-compliant income to total revenue should be less than 5%. Total revenue includes Gross revenue plus any other income earned by the company. This amount is to be cleansed out as charity on a pro rata ratio of dividends issued by the company. Illiquid Assets to Total Assets: The ratio of illiquid assets to total assets should be at least 20%. Illiquid asset, here, is defined as any asset that that Shariah permits to be traded at value other than the par. Net Liquid Assets to Share Price: The market price per share should be greater than the net liquid assets per share calculated as: (Total Assets – Illiquid Assets – Total Liabilities) divided by number of shares. *Courtesy of Karachi Meezan Index Brochure retrieved from Karachi Stock Exchange Website Rationale of the Study Islamic equity investment funds pose immense growth potential in the future mainly on account of the following reasons: It attracts risk averse investors who previously ignore equity investments because of Islamic Equity’s low risk characteristics It attracts new Muslim investors who previously were wary of investing in stock markets because of non-Shariah compliance Therefore a study needs to be conducted which examines the risk return behavior of Shariah complaint stocks so that investors and general people will have a better idea about the risks profits which are inherent in Shariah complaint shares. Research Questions The study will help in answering the questions such as: Is there a difference in returns of KMI30 and KSE 100 indices? Is there a difference in the volatility of KMI30 and KSE 100 indices? Is KMI30 index giving more or less risk adjusted returns compared to KSE 100 index? How much variation is explained by KSE 100 index in returns of KMI30 index? Limitations of the Study KMI30 index represents the risk return behavior of only 30 blue chip Shariah compliant stocks. In order to have a better comparison with the KSE 100 index, a portfolio consisting of all the stocks from KSE 100 which comply with Islamic screening principles should be constituted and the return volatility attributes of this portfolio should be compared with KSE 100 index because a difference in returns between both indices can be because of superior judgment in the selection of stocks in KMI30. Chapter 2 Literature Khan (1998) studied the modern practices in commodity, currency and corporate stock trading in the light of Islamic economic framework and stated that under Islamic principles, Mudarabah or Shirakah certificates can be traded in stock exchanges. However there is no concept of preferred equity in Islamic finance as it Riba which is forbidden under Islam. Khan stated that liability towards losses of the organization need to be met which may have accumulated over a period in order to sell or disinvest shares of that organization which implied that each shareholder has a liability for cumulative past losses as well as current losses in proportion to the capital invested. Khan (1998) proposed a model of stock valuation which incorporates the Islamic principles that intrinsic value of shares should provide the prospective investor a fair amount of information about past performance of organization. Iv = intrinsic value of shares Pv = par value of shares Ri = Profits, Reserves etc L = losses S = No. of Share Lewis (2010) examined the current and historic structure and performance of Islamic investment funds and found out that Islamic investments have grown quickly over the past few years and now there are approximately 650 Islamic funds operating globally. Lewis also discovered that in the past Islamic funds have focused more on negative forbidden screening principles instead of focusing on both the negative and positive screening methodologies like socially responsible funds that focus primarily more on investments in companies which play a part in human welfare. However these Socially Responsible Investments (SRI) funds performed slightly poor compared to Islamic funds because Islamic funds invested a significant portion in energy companies who enjoyed profitability because of rising oil prices, SRI funds do not invest large portions in fossil fuel energy companies primarily because of their futile side effects on environment. Nik Maheran and Masliza (2008) analyzed the performance of Islamic mutual funds at Kuala Lumpur Stock Exchange to investigate if these funds underperform or over perform the market index using average return on mutual funds, standard deviation of weekly returns, coefficient of variation, Treynor and Sharpe index. They found out that most of the funds achieved a lower return than market from the period 2002 until 2006. However in terms of risk level Islamic mutual funds showed less risky behavior compared to the market since the betas of Islamic mutual funds was less than one. Rennebook, Horst and Zhang (2007) critically reviewed the available literature on socially responsible investments and concluded that a primary reason for low returns from socially responsible funds could be the multi-task nature of portfolio managers who pursue both financial and social objectives. They also found out that if investors avoid investments in unethical/asocial businesses, than they may require a low rate of return than other investors who do not show any similar type of preferences. Hussein (2007) analyzed the returns of FTSE Global Islamic index and Dow Jones Islamic Index from 1993 till 2004 and compared them with the returns of Dow jones world index and FTSE All world index. He found out that application of Shariah screening doesn’t adversely impact on Islamic indices performance as Islamic indices performed as well as their counterparts over the entire period. Hussein (2007) stated that Islamic indices yield statistically positive returns in bull market period though Islamic indices underperform the all world indices in the bear period and in the long run have a superior performance compared with counterparts in entire market period. Abdullah, Hassan and Mohammad (2007) compared the performance of Islamic and conventional mutual funds in Malaysian capital market with the help of Sharpe index, adjusted Sharpe index, Jensen Alpha, timing and selective ability and found out that Islamic funds are less risky than conventional funds and both Islamic and conventional funds have diversification levels which are less than 50 per cent of the diversification level of the market portfolio. They discovered that Islamic funds performed better than conventional funds during bearish periods while conventional funds performed better than Islamic during bullish periods and concluded that Islamic funds can be used as hedging tools. Hussein (2005) compared the performance of Dow Jones Islamic market index and FTSE Global Islamic index and benchmarked it against their counterparts, Dow Jones World index and FTSE Global Index respectively, using parametric t-statistic and non-parametric signed rank test. Monthly returns data had been used ranged from 1996 2004 and the periods had been divided into bull and bear return phases to make more meaningful conclusions from results. Hussein (2005) found out that Dow Jones Islamic Index outperformed its counterpart in the entire period (1996 – 2004) and bull period. The mean monthly return of Dow Jones World Index was higher than the DJ Islamic index over the entire bull period which indicated that the Islamic index has greater volatility in comparison with DJ world index. Contrary to this, Dow Jones Islamic index fails to maintain its better performance over the bear market phase where the DJ world index gives better returns. In case of FTSE indices, FTSE Global Is lamic index outperforms FTSE All world index in the entire and bull periods. However FTSE Islamic index underperforms FTSE world index over bear period. Hussein (2005) also found out that the beta of both Islamic indices is greater than one and higher than their counterparts which imply that both Islamic indices are riskier than their counterparts. Hence Hussein (2005) stated that the application of Shariah screening principles has no adverse effect on Islamic indices performance over the years and concluded that Shariah investing offer superior performance compared to unscreened portfolios. Albaity and Ahmad (2008) examined the performance of KLSI, A Shariah Compliant Index at Bursa Malaysia, and benchmarked it against KLCI which is a conventional stock market index at Bursa Malaysia using measures of risk adjusted returns and found out that KLCI is outperforming KLSI. Albaity and Ahmed (2008) also found out that KLCI has a higher beta as evident from conventional Non-Islamic indices and that in the short run both indices move in the same direction and tend to cause each other. Hence they concluded that there is no significant difference in the returns and movements of both indices. Hakim and Rashidian (2002) applied Islamic equity screening principles on Wilshire 5000 index and created a Shariah Compliant Portfolio and compared the return characteristics of the created Wilshire Islamic portfolio and Dow Jones Islamic market index portfolio with the parent Wilshire 5000 index and found out that the reduced diversification characteristic of newly created portfolio has not adversely affected its performance when compared with parent Wilshire 5000. Hakim and Rashidian (2002) examined the causality between the Islamic index, the Wilshire 5000 and the Tbill rate and found out that the Islamic index is influenced by factors independent from the broad market or interest rates which are contrary to the widely accepted notion that Dow Jones Islamic Index exhibits high correlation with broad market. They concluded that such correlation is temporary and false Sauer (1997) measured and analyzed the average monthly returns and variability, Jensen Alpha and Sharpe performance of the Domini 400 Social index portfolio and benchmarked it against the performance of two unrestricted portfolios (SP 500 and CRSP value weighted market indexes). Sauer (1997) discovered that the application of socially responsible strategy in stock selection does not impact the investment performance adversely. He concluded that the potential performance costs of implementing socially responsible criteria, as represented by the performance of Domini social index are negligible. Sauer (1997) also stated that the performance of Domini Social equity Mutual fund compares favorably to the performance of Vanguard SP 500 index. Bauer, Koedijik and Otten (2004) analyzed the performance of 103 German, UK and US ethical mutual funds and found no indication of substantial difference in return behavior between ethical and conventional mutual fund returns after controlling for factors like book to market and size. Bauer, Koedijik and Otten (2004) also concluded that ethical mutual funds are typically less exposed to market variability compared to conventional funds. Hamilton, Jo and Statman (1993) studied 32 socially responsible mutual funds and compared their returns with a portfolio of 177 conventional mutual funds. They found out that market do not price social responsibility characteristics so investors can expect to lose nothing by investing in socially responsible mutual funds; social responsibility factors have no effect on expected stock returns or companies’ cost of capital. Derigs and Marzban (2009) analyzed SP, DJIM, FTSE, MSCI and HSBC Shariah Complaint indices and stated that current Shariah compliant strategies result in much lower portfolio performance than portfolios without considering Shariah Compliance. They suggested that the return from Shariah complaint strategies can be increased by making Shariah compliance an attribute of portfolio constructed rather than measuring compliance on as asset level. Derigs and Marzban (2009) argued, Funds are investment vehicles, which are financially independent of the institutions that establish them. Therefore, a fund takes the form of an independent company, such as a limited liability company (Norman, 2004), in which investors act as shareholders. So they proposed that with respect to compliance a fund which itself invests in multiple companies has to be evaluated in the same way as a conventional independent company. Hassan and Antoniou (2006) examined the potential impact of Islamic screening restrictions on investment performance by comparing the performance characteristics of a diversified of Islamic screened stock indices with conventional benchmarks (Data stream Global Index) and the degree of correlation and volatility in price movements between both indices. Hassan and Antoniou (2006) concluded that the impact of stock screens is closely related to the performance of stock markets and further stated that any argument that Islamic equity investments are less profitable than conventional types of investments is questionable which is supported by relatively major differences between Sharpe and Treynor measures and significant positive Alpha over the positive returns period when the Dow Jones Islamic Market Index outperformed the Data stream Global Index. Chapter 3 Methodology This section emphasizes the research methodology and the type of data that has been used in this research. The research is quantitative in nature as statistical and financial models are being used to test the STOCK INDEX time series for volatility and return. The data which is going to be used in the research is secondary in nature and in the form of time series. Daily index values of Karachi Meezan Index (KMI-30), KSE-30 index and KSE-100 index from Karachi stock exchange are being used as secondary data from December 15, 2008 till March 11, 2011. Daily logarithmic returns of all indices are being calculated such that: Where is the raw return for index i for the time t, refers to the price of index i at time t, and is the price of index i at time t-1. A descriptive statistical analysis was performed on the calculated daily logarithmic returns using to calculate mean, standard deviation, standard error, median, variance, kurtosis, skewness, maximum and minimum values of all three indices for the whole period from December 15, 2008 to march 11, 2011. Also Geometric mean for all three indices was also calculated as it contains the effect of compounding. Coefficient of variation is calculated to measure the variation in each index given its return. A correlation matrix was being calculated using excel spreadsheet to find the degree of correlation between KMI-30, KSE-30 and KSE-100 indices. A linear regression analysis has been performed using the returns of KMI-30 index as dependent variable and returns from KSE-100 as the independent variable to estimate the coefficient of determination (R-Square) and beta of KMI-30. Another linear regression was performed using KSE-30 as the dependent variable and KSE-100 as the market independent v ariable to estimate the beta of KSE-30 and coefficient of determination. The regression equations were as follows: Where is the intercept, is the beta of the stock index, and are the returns on KMI30 and KSE30 indices respectively and is the return on KSE100 regarded as the return on the stock market. Risk ratios which are used in the analysis to compare the risk reward profile of KMI30 with KSE 30 and KSE 100 are Alpha, Beta, Standard Deviation, R-Squared, Sharpe Ratio and Treynor ratio. A paired t-test was performed to check the hypothesis of difference in means of KMI30 and KSE 100 index because nearly all of the stocks of KMI30 are part of KSE 100 hence dependent. Also F-test was performed to check the difference in variances of KMI30 and KSE 100 indices assuming that the returns from both indices are normally distributed. The whole period from December 15, 2008 to March 11, 2011 is than divided into two bull periods and one relatively flat period to find out the risk-return profile of KMI30 and KSE 100 in these periods. The first bull period is from January 15, 2009 till October 15, 2009 while the flat period is from October 15, 2009 till October 15, 2010. The second bull period is considered from October 15, 2010 to January 15, 2011. A descriptive analysis was again performed on these bull and flat periods along with similar paired t-tests, F-tests, linear regression and correlation matrices. Sharpe ratio, Treynor ratio, Jensen Alpha, Beta and S. Deviation were also calculated for these bull and flat periods. Chapter 4 Results Analysis Descriptive Statistical Analysis Descriptive analysis shows that KMI30 index showed very good daily mean returns of 0.1014% since Dec 15, 2008 till March 11, 2011. KMI30 index started in September 2008 and considering the mean returns, it is a very good performance by a stock exchange index especially when comparing with geometric mean of KSE 30 returns of 0.0227% and KSE 100 daily returns of 0.0451% in the same period. The standard deviation of KMI30 index daily returns was 1.5051% which is considerably less than its counterpart KSE 30 index however more than the S. Deviation of KSE 100 index as expected because of large diversification effects of stock returns in KSE 100. The coefficient of variation for KMI30 index is 15.97 compared to 33.36 for KSE 100 and 74.593 for KSE 30 which clearly indicates that KMI30 is less risky when compared to both other indices per unit of return. The excess kurtosis for KMI30 for the complete period is 2.58 compared to 2.13 for KSE 100 and 2.29 for KSE 30 which shows that all three indices are more peaked than normal distribution and are leptokurtic. All three indices are negatively skewed which shows that most of the returns are negative. As indicated by higher standard deviations of KSE 30 index, its maximum and minimum return are greater than KMI30 maximum and minimum returns. The maximum one day return for KMI30 during the whole period was 5.3% while the minimum return was -5.19%. From January 15, 2009 to October 15, 2009, KSE showed a bullish trend. The geometric mean of KMI30 index daily returns during this first bullish period was around 0.31% much higher than 0.24% of KSE 100 and 0.28% of KSE 30. However the standard deviation of KMI30 index is 1.93% less than 1.88% of KSE 100 and 2.35% for KSE 30. This shows that not only KMI30 beat KSE 100 and KSE 30 in returns but also remained less volatile over the bullish period when compared to KSE 100 and KSE 30. The kurtosis of all three indices is slightly over 3 (Excel displays Excess Kurtosis) which shows that all three indices are mesokurtic and have a kurtosis equal to that of normal distribution. KMI30 showed a slight negative skewness of -0.0195, while KSE 100 showed positive skewness of 0.04058 in this bullish period. From October 15, 2009 to October 15, 2010, KSE showed a relatively flat period of returns with KMI30 index showing a mean geometric return of 0.0498% while KSE 100 and KSE 30 showed a geometric return of 0.017% and –0.0249% respectively. The KMI30 again outperformed KSE 100 and KSE 30 in returns over this flat period. KSE 30 had negative mean returns in this period. KMI30 also showed low standard deviation of 1.088% compared to 1.1049% of KSE 100 and 1.3866% of KSE 30. Hence KMI30 again outperformed KSE 30 and KSE 100 index in this relatively flat period in terms of returns and low volatility. KMI30 had an excess kurtosis of 2.18 more than 1.79 for KSE 100 but less than 2.26 of KSE 30. Hence all three indices have leptokurtic distribution with high peaks than normal distribution. KMI30, KSE 100 and KSE 30 all showed negative skewness in this flat period. From October 15, 2010 till January 15, 2011, KSE showed a relatively bullish trend with KMI30 showing a daily return geometric mean of 0.36% against 0.3% by KSE 100 and 0.33% by KSE 30 index. However KMI30 index showed a higher daily standard deviation of 0.86% compared to 0.73% of KSE 100. KMI30 also showed a more leptokurtic distribution compared to KSE 100 as the excess kurtosis of KMI30 was around 0.497 compared to 0.262 for KSE 100. During this bullish period all three indices showed a positive skewness with impressive returns in a short span of time. Over the whole period, from December 15, 2008 to march 11, 2011, KMI30 showed impressive annualized returns of 28.825% compared with KSE 100 and KSE 30 which showed annualized returns of 11.9367% and 5.85% respectively. The annualized standard deviation for KMI30 index was a little higher than KSE 100 but lower than that of KSE 30. Also the total return over this two and a half year period by KMI30 was quite impressive and 2.5 times more of KSE 100. KMI30 had a total return of 75.11% from Dec 15, 2008 to March 11, 2011. Sharpe ratio is only positive for the KMI30 because the other two indices had returns less than 12 month Treasury bill rate. Jensen’s alpha for KMI30 was 16.8687 which indicated the average return on KMI30 over and above the CAPM predicted return of 11.9566%. KMI30 also had a beta lower than one which shows that KMI30 is less volatile than the overall market. KSE 30 had a beta of greater than one showing that it’s more volatile than the market KSE 100 in dex. Correlation matrix shows a strong correlation of 92.933% of KMI30 and KSE 100 over the whole period from December 15, 2008 to March 11, 2011. KSE 30 showed a less strong correlation of 87.48% in the same period with KSE 100. In the first bullish period, KMI30 however had a rather less strong correlation with KSE 100 compared to the whole period correlation described above. In the flat period from Oct 15, 2009 till Oct 15, 2010, KMI30 had a very strong correlation with KSE 100 index. In second bullish period, from Oct 15, 2010 to Jan 15, 2011, KMI30 again had a relatively less strong correlation with KSE 100 as already happened in first bullish period. It looks like KMI30 is showing less strong correlation with KSE 100 in bull markets and very strong correlation with KSE 100 in relatively flat periods which shows that KMI30 shows returns which are less correlated with market in bull periods and give more correlated returns in flat market periods. In both bull periods, Jan 15, 2009 – Oct 15, 2009 and Oct 15, 2010 – January 15, 2011, KMI30 outperformed KSE 100 and KSE 30 index with impressive margins. KMI30 gave a total return of 81.68% in the first bull period, 13.24% in the flat period and 23.67% in the second bull period. KSE 100 gave total returns of 57.3%, 4.34% and 19.92% in the same periods. KMI30 also showed a relatively same standard deviation as the KSE 100 except for the second bull period when there was a large difference in S. Deviation of KMI30 and KSE 100 returns. What this means is that KMI30 is giving higher returns than KSE 100 while having the same risk as KSE 100 also evident by Sharpe ratio. In first bull period, KMI30 had a beta of 0.927 compare to 1.077 of KSE 30. In the flat period, KMI30 had a beta of 0.948 while KSE 30 had a beta of 1.06. In the second bull period, KMI30 and KSE 30 showed an irregular trend when the beta for KMI30 increased over 1 while beta for KSE 30 dropped less than o ne. Regression Analysis A regression analysis was performed on the daily returns of KMI30, KSE 30 and KSE 100 for the complete period to explain the variation in the returns of KMI30 and KSE 30 index by using KSE 100 as the independent market index. The regression equations are as follows: Equation 1 Equation 2 The R-Square for the first model of KMI30 returns come out to be 86.366% which tells us that 86% of the variation in KMI30 index is caused by KSE 100 index. The R-square for the second KSE 30 model was 77% which shows that KSE 100 causes more variation in returns of KMI30 than KSE 30 index. The intercept of first equation is 0.000523179 which shows that when the daily market return is zero, than KMI30 has a daily return of 0.0523179%. The slope of the first equation, beta of KMI30 index, tells us that a one percentage change return in KSE 100 index causes a 0.9752 percentage change return in KMI30 index which shows low volatility in KMI30 compared to KSE 100. The slope and intercept for the KSE 30 model are 1.1018 and -0.0216% respectively which indicates that KSE 30 is more volatile than KSE 100 (has a beta higher than 1) and that a zero return from market will causes a -0.0216% daily return fall in KSE 30 index. Hypothesis testing The first hypothesis was to test that whether there are any significant differences in daily returns of KMI30 and KSE 100 indices for the whole period from December 15, 2008 to March 11, 2011. Since all the stocks which are part of KMI30 index are also a part of KSE 100 index which indicates that both samples are dependent hence paired t-test was employed to test the differences between returns of both indices. The null and alternative hypotheses are given as: Ho: The difference in mean daily returns of KMI30 and KSE 100 index for the period from December 15, 2008 to March 11, 2011 is equal to zero H1: The difference in mean daily returns of KMI30 and KSE 100 index for the period from December 15, 2008 to March 11, 2011 is not equal to zero The paired t –test was performed on a 5% level of significance with 552 degrees of freedom. The calculated t statistic was 2.310548072 which was greater than the critical value of 1.96. Hence the null hypothesis was rejected and the conclusion was that the difference in mean daily returns of KMI30 and KSE 100 returns is different from zero. The second hypothesis tested whether there are any significant statistical differences in returns of KMI30 and KSE 100 indices during the first bullish period from January 15, 2009 to October 15, 2009. The same paired t test was employed to test the difference in returns in this bullish period using a significance level of 5%. The null and alternative hypotheses are given as: Ho: the difference in mean daily returns of KMI30 and KSE 100 index for the bullish period from January 15, 2009 to October 15, 2009 is equal to zero H1: the difference in mean daily returns of KMI30 and KSE 100 index for the bullish period from January 15, 2009 to October 15, 2009 is not equal to zero The calculated t-statistic was 1.2773207 less than the critical value of 1.972 at 5% level of significance with 187 degrees of freedom. Hence the null hypothesis was failed to reject and it was concluded that there is no difference in the returns of KMI30 and KSE 100 indices during the first bullish period from January 15, 2009 to October 15, 2009.

Antony Flew: The Existence and Belief Of God Essay -- Philosopher Anto

Antony Flew: The Existence and Belief of God Antony Flew starts by telling the audience this story of two explorers that accidentally came upon a garden in a jungle. In this garden, there were many beautiful flowers and weeds. One explorer says, "some gardener must tend this plot". While the other disagrees, "there is no gardener". So, these two explorers tried to figure out who was right and who was wrong. They waited the whole night, but no gardener was ever seen. Then the "Believer" said that there must be a gardener, that he "is an invisible gardener". He tried everything he could to convince to the "Sceptic" that he was right, barbed-wire, electrifying fence, patrolling bloodhounds. But no gardener was ever found. Still the "Believer" was not convinced. He gave the "Sceptic" many excuses as to why they couldn't see the gardener. The "Sceptic" told him that he was crazy because what started out as a simple assertion that there was a gardener, turned into "an imaginary gardener".   Ã‚  Ã‚  Ã‚  Ã‚  This parable that Flew is using is clearly an analogy to the existence and belief of God. The garden represents God, "†¦invisible, intangible, insensible†¦". The "Sceptic" says there is no gardener, just as an atheist denies the existence God. The "Believer" says there is a gardener, like a theist telling everyone that God exists. The "Believer" tries to prove that there was a planter, who planted the seeds for the flowers to grow. This planter takes care of them, a parallelism to God supposedly taking care of "us".   Ã‚  Ã‚  Ã‚  Ã‚  Flew talks about assertions. He states that "what starts as an assertion, that something exists†¦may be reduced step by step to an altogether different status". He uses the example of how if one man were to talk about sexual behavior, "another man prefers to talk of Aphrodite". They don't seem to make sense. How can one confuse the idea of a sexual behavior with Aphrodite? He also points out the fact that "a fine brash hypothesis may be killed by inches, the death of a thousand qualifications". A good example of this is when he said that "God loves us as a father loves his children". He states that when we see a child dying of cancer, his "earthy father" is there, to help him, nurture him, trying his best for his son. But his "Heavenly Father", God, is no where to be found, that he "reveals no obvious sign of concern". The... ...arden in which I find myself, that I am unable to share the explorers' detachment," said Hare. He tried to point out that if he was in the same situation, he would not share the same views as the explorers. Which is a belief in the g ardener, a belief in God. Both of these man had some strong viewpoints. Flew states, if one asserts something, then one must deny something. What Hare is trying to say is that, there is two sides to every idea or "assertions", a blik. That that is a sane blik and a insane blik. Most people have the sane one and those who don't share this view is point as lunatics. But no one is not trying to deny something here. The person with the insane blik is not wrong or that he's not trying to deny something, it's just that his views are different. Flew states, "what would have to occur or to have occurred to constitute for you a disproof of the love of, or of the existence of, God?" Hare's reply to this question is that he calls this "completely victorious." Nothing have to occur because those who does not share this belief in God have an insane blik. They are not trying to deny that God doesn't but rather that they views are just different.

Ethical Theories :: Philosophy Philosophical Essays

Ethical Theories Hedonism and self-realization are ethical theories that take roots in the works of Greek philosophers and that developed many branches throughout the human history. Hedonism is based on the recognition of pleasure (or happiness) and avoidance of pain as an ultimate goal of any human being and thus establish a moral ground for one’s acting in striving to be happy. In early stages, hedonism took individualistic forms of Cyrenaic and Epicurean theories. In order to lead a good life, the Cyrenaics propose to actively seek intense momentary pleasure (of any duration) from our everyday life maintaining that pleasures of our senses and the body are preferable to pleasures derived from the mind. In contrast to Cyrenaics, the Epicurean theory denies active seeking of pleasure in favor of avoidance of pain (in fact, Epicurean view defines pleasure as avoidance of pain) and stresses the importance of long-run mental contentment in life. While Cyrenaics and Epicureans sought pleasure only for themselves exercising individualistic hedonism, Stuart Mill’s theory is an example of universalistic hedonism which takes into account not only the pleasure people can gain for themselves but also how those pleasure-seeking actions affect other individuals and society in general and whose ultimate goal is to increase the amount of happiness for humankind as a whole. Specifically, Stuart Mill adhered to the theory of utilitarianism (a social hedonism) that states that moral actions are right if they produce â€Å"the greatest amount of happiness for the greatest number of persons.† The significance of his work is in introduction of the qualitative aspect of pleasure into utilitarianism. According to Mill, there are different kinds of pleasure and the more desirable of any two kinds is the one that is agreed to be more valuable or desirable for the majority of people who experienced both. The intellectual pleasure d erived from art, music, etc. is considered to be higher than physical pleasure derived from sex, eating, etc. Based on the classification of different kinds of pleasure performed by experts the moral values of the society can be developed and then followed by everyone. To avoid immoral actions that can be justified as means of maximizing happiness, Mill adheres to rule-utilitarian view which states that an action is right if it is based on a rule that maximizes happiness of the affected population as opposed to act-utilitarianism that evaluates the action itself. For example, a rule of helping others maximizes happiness in general so we should follow this rule. Ethical Theories :: Philosophy Philosophical Essays Ethical Theories Hedonism and self-realization are ethical theories that take roots in the works of Greek philosophers and that developed many branches throughout the human history. Hedonism is based on the recognition of pleasure (or happiness) and avoidance of pain as an ultimate goal of any human being and thus establish a moral ground for one’s acting in striving to be happy. In early stages, hedonism took individualistic forms of Cyrenaic and Epicurean theories. In order to lead a good life, the Cyrenaics propose to actively seek intense momentary pleasure (of any duration) from our everyday life maintaining that pleasures of our senses and the body are preferable to pleasures derived from the mind. In contrast to Cyrenaics, the Epicurean theory denies active seeking of pleasure in favor of avoidance of pain (in fact, Epicurean view defines pleasure as avoidance of pain) and stresses the importance of long-run mental contentment in life. While Cyrenaics and Epicureans sought pleasure only for themselves exercising individualistic hedonism, Stuart Mill’s theory is an example of universalistic hedonism which takes into account not only the pleasure people can gain for themselves but also how those pleasure-seeking actions affect other individuals and society in general and whose ultimate goal is to increase the amount of happiness for humankind as a whole. Specifically, Stuart Mill adhered to the theory of utilitarianism (a social hedonism) that states that moral actions are right if they produce â€Å"the greatest amount of happiness for the greatest number of persons.† The significance of his work is in introduction of the qualitative aspect of pleasure into utilitarianism. According to Mill, there are different kinds of pleasure and the more desirable of any two kinds is the one that is agreed to be more valuable or desirable for the majority of people who experienced both. The intellectual pleasure d erived from art, music, etc. is considered to be higher than physical pleasure derived from sex, eating, etc. Based on the classification of different kinds of pleasure performed by experts the moral values of the society can be developed and then followed by everyone. To avoid immoral actions that can be justified as means of maximizing happiness, Mill adheres to rule-utilitarian view which states that an action is right if it is based on a rule that maximizes happiness of the affected population as opposed to act-utilitarianism that evaluates the action itself. For example, a rule of helping others maximizes happiness in general so we should follow this rule.

Heroin Addiction Essay

According to The National Institute on Drug Abuse, heroin is an illegal, highly addictive drug. It is both the most abused and the most rapidly acting of the opiates. Heroin is processed from morphine, a naturally occurring substance extracted from the seed pod of certain varieties of poppy plants. It is typically sold as a white or brownish powder or as the black sticky substance known on the streets as â€Å"black tar heroin†. Although purer heroin is becoming more common, most street heroin is†cut† with other drugs or with substances such as sugar, starch, powdered milk, or quinine. Street heroin can also be cut with strychnine or other poisons. Because heroin abusers do not know the actual strength of the drug or its true contents, they are at risk of overdose or death. Heroin also poses special problems because of the transmission of HIV and other diseases that can occur from sharing needles or other injection equipment. According to the 2003 National Survey on Drug Use and Health, which may actually underestimate illicit opiate (heroin) use, an estimated 3. 7 million people had used heroin at some time in their lives, and over 119,000 of them reported using it within the month preceding the survey. An estimated 314,000 Americans used heroin in the past year, and the group that represented the highest number of those users were 26 or older. The survey reported that, from 1995 through 2002, the annual number of new heroin users ranged from 121,000 to 164,000. During this period, most new users were age 18 or older (on average, 75 percent) and most were male. In 2003, 57. 4 percent of past year heroin users were classified with dependence on or abuse of heroin, and an estimated 281,000 persons received treatment for heroin abuse. According to the monitoring the Future survey, NIDA’s nationwide annual survey of drug abuse among the Nation’s 8th, 10th, and 12th graders, heroin use remained stable from 2003-2004. Lifetime heroin use measured 1. 6 percent among the 8th graders and 1. 5 percent among 10th- and 12th graders. The 2002 Drug Abuse Warning Network (DAWN), which collects data on drug related hospital emergency department (ED) episodes from 21 metropolitan areas, reported that in 2002, heroin -related ED episodes numbered 93,519. NIDA’s Community Epidemiology Work Group (CEWG), which provides information about the nature and patterns of drug use in 21 areas, eported in its December 2003 publication that heroin was mentioned as the primary drug of abuse for large portions of drug abuse treatment admissions in Baltimore, Boston, Detroit, Los Angeles, Newark, New York, and San Francisco. How is heroin used? Heroin is usually injected, sniffed/snorted, or smoked. Typically, a heroin abuser may inject up to four times a day. Intravenous injection provides the greatest intensity and most rapid onset of euphoria (7 to 8 seconds), while intramuscular injection produces a relatively slow onset of euphoria (5 to 8 minutes). When heroin is sniffed or smoked, peak effects are usually felt within 10 to 15 minutes. NIDA researchers have confirmed that all forms of heroin administration are addictive. Injection seems to be the predominant method of heroin use among addicted users seeking treatment; in many CEWG areas, heroin injection is reportedly on the rise, while heroin inhalation is declining. However, certain groups, such as White suburbanites in the Denver area, report smoking or inhaling heroin because they believe that these routes of administration are less likely to lead to addiction. With the shift in heroin abuse patterns comes an even more diverse group of users. In recent years, the availability of higher purity heroin (which is more suitable for inhalation) and the decreases in prices reported in many areas have increased the appeal of heroin for new users who are reluctant to inject. Heroin has also been appearing in more affluent communites (z). According to the NDIA the immediate effects of heroin (the short term), soon after injection (or inhalation), heroin crosses the blood-brain barrier. In the brain, heroin is converted to norphine and binds rapidly to opioid receptors. Abusers typically report a feeling a surge of pleasurable sensation-a â€Å"rush†. The intensity of the rush is a function oof how much drug is taken and how rapidly the drug enters the brain and binds to the natural opioid receptors. Heroin is particularly addictive because it enters the brain so rapidly. With heroin, the rush is usually accompanied by a warm flushing of the skin, dry mouth, and a heavy feeling in the extremities, which may be accompanied by nausea, vomiting, and severe itcing. After the initial effects, abusers usually will be drowsy for several hours. Mental function is clouded by heroin’s effect on the nervous system. Cardiac function slows. Breathing is also severely slowed, sometimes to the point of death. Heroin overdose is a particular risk on the street, where the amount and purity of the drug cannot be known. The long term effects of heroin use and the most detrimental is addiction itself. Addiction is a chronic, relapsing disease, characterized by compulsive drug seeking and use, and by neurochemical and molecular changes in the brain. Heroin also produces profound degrees of tolerance and physical dependence, which are also motivating factors for compulsive use and abuse. As with abusers of any addictive drug, heroin abusers gradually spend more and more time and energy obtaining and using the drug. Once they are addicted, the heroin abuser’s primary purpose in life becomes seeking and using drugs. The drugs literally change their brains and their behavior. Physical dependence develops with higher doses of the drug. With physical dependence, the body adapts to the presence of the drug and withdrawal symptoms occur if use is reduced abruptly. Withdrawal may occur within a few hours after the last time the drug is taken. Symptoms of withdrawal include restlessness, muscle and bone pain, insomnia, diarrhea, vomiting, cold flashes with goose bumps (cold turkey), and leg movements. Major withdrawal symptoms peak between 24 and 48 hours after the last dose of heroin and subside after about a week. However, some people have shown persistant withdrawal signs for many months. Heroin withdrawal is never fatal to otherwise healthy adults, but it can cause death to the fetus of a pregnant addict. At some point during continuous heroin use, a peson can become addicted to the drug. Sometimes addicted individuals will endure many of the withdrawal symptoms to reduce their tolerance for the drug so that they can again experience the rush. Physical dependence and the emergence of withdrawal symptoms were once believed to be the key features of heroin addiction. We now know this not to be the case entirely, since craving and relapse can occur weeks and months after withdrawal symptoms are long gone. We also know that patients with chronic pain who need opiates to function (sometimes over extended periods) have few if any problems leaving opiates after their pain is resolved by other means. This may be because the patient in pain is simply seeking relief of pain and not the rush sought by the addict. The Medical consequences of chronic heroin injection use include scarred and/or collapsed veins, bacterial infections of the blood vessels and heart valves, abscesses (boils) and other soft –tissue infections, and liver or kidney disease. Lung complications (including various types of pneumonia and tuberculosis) may result from the poor health condition of the abuser as well as from heroin’s depressing effects on respiration. Many of the additives in street heroin may include substances that do not ready dissolve and result in clogging the blood vessels that lead to the lungs, liver, kidneys, or brain. This can cause infection or even death of small patches of cells in vital organs. Immune reactions to these or other contaminants can cause arthritis or rheumatologic problems. Ofcourse, sharing of injection equipment or fluids can lead to some of the most severe consequences of heroin abuse-infections with hepatitis B and C, HIV, and a host of other blood-borne viruses, which drug abusers can then pass on to their sexual partners and children.