Capital vs Liquidity free essay sample

In the context of the events of the last few years just how important is liquidity to the survival and well-being of Financial Institutions? Some believe it has a greater influence on events than Capital! Discuss. (In this assignment you need to outline the role of liquidity, issues arising when liquidity is scarce and compare the role of liquidity to that of Capital but most importantly give your own view on these matters) Role of Liquidity Liquidity can be defined as 1) the ability of a business to meet obligations without disposing of its fixed assets or 2) the degree to which assets of a company can be easily converted into cash. The evolution of banking has seen their balance sheet composition change. The model changed from one of borrowing at low rates and lending high rates with little interest rate or liquidity risk to one where borrowing in the short end and lending in longer maturities. This change created both interest rate risk and liquidity risk. [pic] Figure 1 Liquidity Gap In the early model a 1 month loan at 8% is matched by a 1 month deposit at 5%. The margin is locked in at 3%. The only risk to the bank is credit risk, i. e. that the loan gets repaid. In the modern scenario we have a 150 day loan at 6% funded by a 7 day deposit at 1%. In this example we have credit risk, interest rate risk and liquidity risk. This model facilitates greater margin as it is generally cheaper to borrow in the short term and higher rates available if lending in the longer term. The risks are that in 7 days, where will the borrowing rate be (rate risk) and will the bank be able to borrow (liquidity risk)? The hedging of interest rate risk has been made much easier with the evelopment of interest rate swaps and other derivative items. As these are off balance sheet products, they do not provide liquidity and so the modern model is very susceptible to any problems with liquidity. The interbank cash market is quite sophisticated. International banks can trade with each other very efficiently using many products. †¢ Straight loans and deposits, si mple products of fixed term from overnight up to 1 year. Usually not guaranteed. †¢ Bond repurchase agreements (repos), banks borrow cash and pledge a bond as security against the loan. More secure for the lender than loans and therefore cheaper for the borrower. †¢ Foreign exchange forwards, involves the exchange of one currency for another for a fixed term. These are cleared centrally and will have a small element of credit risk. These are useful if an organisation is able to access one currency and unable to source another, e. g. the US dollar funding requirements of Irish Banks. †¢ Commercial Paper (CP) and Certificates of Deposit (CD’s) are similar to a cash loans but it can be sold on in the secondary market. This makes them more liquid. All of the above are used to â€Å"square up† a bank’s books on a daily basis. Also banks run gap analysis to reconcile any funding mismatches and close off those gaps if required. This is called liability management. The funding situation would generally have been very fluid. For example, CD’s issued on the day or a large corporate withdrawing a sizeable deposit. The interbank market was the place to lend your excess cash or borrow your shortage and it functioned effectively. This post World War II move to asset driven balance sheets has led to increased focus on liability management. This, aligned with disintermediation, where large corporates bypassed traditional banking methods, led to more innovation in the banking industry. Medium Term Notes (MTNs) and asset securitisation are longer term funding solutions that became more popular in recent times. MTNs can be senior or subordinated debt and are quite flexible for issuer and investor. They usually are for 3 to five years and some may have embedded options. They can have fixed or floating rates and trade on the secondary market. Securitisation involves the packaging of assets into a bond and selling them with the underlying assets as security on the bonds. Typical assets that can be sold this way are mortgages, credit card debt, car loans or student debt. This model was used by Northern Rock (NR) in the UK where they originated mortgages that were then securitised. This enabled them to â€Å"churn† their balance sheet and issue more mortgages. There was an inherent liquidity risk run by NR with this model as their funding was not diversified sufficiently aligned with a failure to realise that market conditions for mortgage backed securities (MBS) would deteriorate in stressed markets. Between issuing a mortgage and securitising it, there will always be a time lag and to cover that NR relied on wholesale interbank funding in the short dates (up to 3 months). This source quickly disappeared as banks pulled any limits. The building society had then to go to their lender of last resort, the Bank of England, and with that news hitting the headlines, ordinary depositors queued up outside branches to get their own money out. This was the first run on a UK bank in 150 years. Eventually NR was taken over by the state. In the context of this case it’s interesting to note that the run was caused by what I would consider â€Å"over-transparency†. The Bank of England had a rule that obliged them to publish the names of institutions that used its liquidity support facility and allied with a lack of satisfactory deposit insurance their depositors took their money and ran. Maybe the rule is not so suitable in these conditions. When Liquidity is Scarce The current crisis we are in the midst of now began in 2007 when sub-prime mortgage bonds became problematic. As well as a regular market for these bonds, a Credit Default Swap (CDS) market also developed. CDS are a derivative that transfers the credit risk of an underlying security, effectively insurance against default. If you bought a bond and also a CDS on that bond, theoretically, you are hedged). The result was that the sub-prime problem had ramifications worldwide. Which banks held sub-prime debt, which institutions had written CDS on s ub-prime debt? Banks may not have any exposure to sub-prime but may well have exposure to banks that had. The international money market was tied together in this crisis. There was a serious lack of transparency of each bank. You couldn’t analyse it latest financial statements and ascertain any given level of risk in a particular area. Money market funds in the US, lenders of cash in the short dates, retrenched. They put their cash into short dated government debt and avoided the interbank market which then froze. There was no liquidity in the market. Confidence was quickly disappearing and if the interbank market loses confidence in an institution, credit lines will be withdrawn, and liquidity will quickly become a major problem. Chart 1 below shows the spread between 3month Euribor* and 3 month Eonia**. In normal functioning markets, these rates should be very similar. They are a measure of the price of liquidity in the markets. As can be seen the correlation is close up to mid ’07. [pic] Chart 1. However in stressed markets you can see what happens. In August ’07 sub-prime became an issue and then again in Sep ’08 when Lehman Brothers failed and once again this summer when the Greek debt crisis began to escalate. The liquidity in European interbank markets was drying up. The above graph represents the â€Å"LIBOR-Eonia† spread and is widely traded in markets now as a hedge against liquidity a crunch. In Ireland in Sept ’08, with the increasing uncertainty of Anglo Irish Banks exposure to the commercial property market, the Irish government has to step in and issue a blanket guarantee on all Irish banks liabilities. [pic] Source Central bank of Ireland. Credit Money Banking Statistics Chart 2. Initially, money flowed into the covered institutions but, as time progressed, the deposits in the Irish banking system left. Chart 2 above shows the more striking movements. I have isolated non-resident deposits. These have fallen by 63% since Oct ’08. Also I have highlighted Irish banks issuance. This falloff shows that the money markets are closed to Irish banks. The modern banks liquidity risk of borrowing short and lending long was crystallizing. Ireland Inc. was losing liabilities. Our loan-to-deposit ratios were deteriorating. Deposit holders moved funds into the AAA rated Rabodirect or elsewhere. Bondholders moved into safer havens such as UK gilts and German Bunds. Further assistance was required for the banks. Central bank intervention began. The ECB began long term refinancing operations (LTRO) where banks could avail of up to 1year cash at the ECB average rate. To avail of the LTRO suitable collateral was required. The Central Bank of Ireland (CBI) assisted with emergency liquidity assistance (ELA) when collateral was ineligible for the ECB. Interestingly the CBI would have take massive haircuts on the collateral which was ineligible for ECB, up to 75%, this would put a lot of pressure on deposit gathering resources. This pressure can be seen in the rates Irish banks are paying for deposits currently. Pressure was increasing for banks to rebuild balance sheets and as the ability to acquire liabilities was extremely limited, they began to reduce assets. These disposals took place in distressed and illiquid markets. Efficient markets did not now exist. The management of liquidity was quickly becoming a one-stop shop, the ECB. Liquidity regulations are largely as a result of the recent liquidity crisis. The prudential liquidity assessment review (PLAR) was introduced by the CBI. This has guidelines consistent with Basel III and other relevant measures of high quality funding. These guidelines will require banks to hold large liquidity buffers mainly of cash and highly rated government debt. The measures on Basel III are primarily the liquidity coverage ratio (LCR 2015) and the net stable funding requirement (NFSR 2018). What levels of liquidity required will be based on stress testing the liquidity profile based on a number of stressed liquidity events. LCR covers short term liquidity stresses and will require high quality unencumbered assets. The NFSR covers a stressed period of a year long and would apply haircuts to all asset classes. This liquidity buffer will come at a cost. Holding low yielding government debt and cash incurs opportunity cost. This cost will be allocated on to the business areas in banks that have generated the assets and will eventually lead to higher cost of funds to the borrower. Also there is the developing situation where the availability of high quality bonds may not meet banks liquidity requirements. The Role of Capital Capital is a company’s net assets including all retained earnings and reserves such as loan loss reserves and can be viewed as an organisations’ strength. Capital should be available for any potential losses a bank may incur. There has been a lot of focus on bank capital from Basel I back in the eighties up to Basel III and the EU’s Capital Requirement Directive (CRD IV), which is currently being implemented. Initially capital ratios were focused on Japanese banks that grew to be the biggest in the world. They did so with very low capital bases (approx 2%). The western world viewed this as inequitable and so Basel I was introduced. Basel I introduced the Cooke ratio that defined capital as equity, retained earnings and convertible bonds (hybrids). It also outlined the weightings assigned to loans to calculate capital requirements. Loans to corporates 100% weighting, loans to banks 20% and sovereigns 0% and it set a capital level of 8% of the weighted assets. [pic] The McDonough Ratio was developed in Basel II and refined its predecessor to include new financial instruments used to manage risk in banks. The latest initiatives focus on the appropriate level of capital required for a given level of risk under certain stressed scenarios. Known as regulatory capital, it is difficult to calculate and we can see many examples of this over the recent past. The question I would ask in trying to come up with an appropriate level of capital is â€Å"What are your future losses going to be? † Is this a ridiculous question? The European Banking Authority, in its first two stress tests couldn’t figure it out. Ireland’s two pillar banks passed the first test in July 2010 and Dexia passed in July 2011 (core tier 1 ratio of 10. 4%) only for all to be nationalised soon after. I think the latest stress tests may be getting closer but the current market uncertainties just magnify the problem. What capital will BNP Paribas, holder of â‚ ¬5bn of Greek Bonds, need with Greece government debt receiving a 50% haircut? What will it need if Greece defaults? I can understand the difficulties for the authorities. Also the banking industry is slow to get to the required level. Basel III has a core tier 1 ratio of 10. % but the target date is 2019. What level is enough and could this level be too much? Models using Value at Risk measures will be using data from the most volatile period in history. Could they be overestimating? Capital comes at a cost. Investors require a return and too much capital could lead to slower or more expensive lending which will lead to lower growth and lower profits a nd erosion of share values. Conclusion In this crisis liquidity has been a massive issue. Capital levels have been hot topics for many years but the effects of this credit crunch has highlighted the importance of proper liquidity provisions. If PLAR had been in place for the last 10 years, would the Irish banks have gotten themselves into this position? Not in my opinion. It certainly would have focused the mind on how liquid our booming commercial and residential property portfolios were. It is, however, debatable whether any shock factors to account for the sudden change in Irish banks books would have been incorporated in the risk models used to assess potential liquidity shortages. Banks dependence on short term wholesale funding was a critical fault. There is no doubt that the relevant authorities worldwide did not recognise the risk. Basel III provides for it by 2019! The European Central Bank is not even a lender of last resort for European banks. It is breaking treaty rules currently with its buying of peripheral government bonds. The liquidity issue can also put pressure on perfectly good entities. Unfortunately we now have a situation where disposal of assets in this stressed environment is required to build up required capital and liquidity buffers. Discounts being applied are serious and it is creating a vicious circle of selling assets to create capital while eroding capital as assets are sold cheaper than could be expected. Perhaps the markets were operating too perfectly for too long. Short term wholesale funding was plentiful for a long time and banks got used to it. It made the carry trade (lending long and borrowing short) easy. However as Warren Buffet famously remarked, â€Å"only when the tide goes out, do you learn who has been swimming naked†. However liquidity problems are like smoke and capital problems are the fire. If concerns over a banks’ liquidity arise, it is primarily because there is concern over its capital or its ability to meet any losses.

Interesting Essay Topics To Write An Essay On

Interesting Essay Topics To Write An Essay OnIt is amazing how many interesting topics one can write an essay on, but you must remember that writing an essay is not merely an exercise in word-building. For it to be able to truly be an essay, it should have a proper structure and tone. This article will give you some of the more intriguing essay topics you can write an essay on.First, what could be a better incentive than to be able to do a few articles for free? Free reports are generally very interesting to read. They are extremely practical and helpful. The best ones come from private companies who are willing to share some of their reports in order to advertise their products and services.As someone who is not much of a reader, this is a real bonus for me. I know there are always more than enough free reports to go around. So if you are struggling to find enough resources, write an essay on the topic of how much money you would make with your current job.Another topic you can writ e an essay on is the topics that are important to your local businesses. There are always plenty of businessmen out there looking for ways to expand their business. Sometimes they simply need a good place to start.You might be able to find a good market opportunity in a particular region or city. Your local businesses can help you open up that opportunity.In fact, you could even find the right product to get involved in the new business you are considering. There are also quite a few writers who love to explore new topics in order to come up with new articles.As you can see, there are some essay topics you can write an essay on. It just depends on what you have in mind and whether or not you can make it happen. Who knows, you might even find yourself selling them on eBay!

Human Trafficking in India Essay Example

Human Trafficking in India Essay India is the second most populous country in the world. Owing to this fact and because of the tremendously high poverty rate in the country; India also leads the world in human trafficking. In the country, around 100 million children are working in homes and factories across India and many of them are in situations that would be likened to slavery. Moreover, for the year 2000 alone, it was estimated that 12.07 percent or 13,157,000 of the 10 to 14 age group are economically active. This consists of 5,992,000 girls and 7,165,000 boys. Additionally, according to the National Labour Institute, 12.6 million children out of the 203 million children from ages of 5 to 14 in India are employed full-time. One hundred sixteen million are in school while another 87 million are â€Å"do housework, work on family farms, work alongside their parents as paid agricultural labourers, work as domestic servants, or are otherwise employed†. The status of the other 74 million is unknown (Global Ma rch Against Child Labour, n.d.) and it is that they are victims of child trafficking. According to Human Rights Watch, a total 40 million people in India are into bonded labour meaning they are working for someone until they pay off a debt. Off this 40 million people, 15 million are children. In some cases, the bondage is even passed from one generation to another if the debt if still unpaid upon the death of the initial person bonded. Other reports indicate that more or less 50,000 children are trafficked into India for prostitution. In Mumbai, estimations indicate that around 90 percent of sex workers started off when they were still under 18 years of age. NGOs also state that 6,000 to 10,000 girls are being trafficked into India from Nepal annually. The same number is determined for girls being trafficked from Bangladesh (Global March Against Child Labour, n.d.). We will write a custom essay sample on Human Trafficking in India specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Human Trafficking in India specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Human Trafficking in India specifically for you FOR ONLY $16.38 $13.9/page Hire Writer The International Labour Organization approximates that 15 percent of the prostitutes in India are children. With 2.3 million prostitutes, this makes for 345,000 child prostitutes. On the other hand, no concrete data is available for the number of children that have been trafficked to be used for crime (Global March Against Child Labour, n.d.). India is a prime destination for sex trade along with Thailand and the Philippines. These three countries comprise for a total 1.3 million child sex workers. India is also the main destination for children aged below 16 who are trafficked in Southeast Asia along with Pakistan (Hughes, Sprocic, Mendelsohn Chirgwin, n.d.). The prostitution in the country is operated and controlled largely by organized crime (Global March Against Child Labor, n.d.) Women and children trafficked from Saudi Arabia are being sent to Middle Eastern nations daily. Girls that are put up for prostitution or domestic service in India, Pakistan and the Middle East are usually tortured, imprisoned and/or sexually abused. In Bombay, children 9 years and above are being sold for 60,000 rupess equivalent to 2,000 USD because of an unfounded belief that having sex with a virgin cures sexually transmitted infections. Indian brothels house 100,000 to 160,000 Nepalese women and girls. They were brought to India as they were made to believe that marriage or a good job awaits them. Additionally, 5,000 to 7,000 Nepalese girls are transported into India every year for prostitution. Data indicates that that 2.5 percent of prostitutes in India are from Nepal while 2.7 percent are from Bangladesh. (Hughes, et. al, n.d.). Many are being sent to prostitution as the families are fooled to send their children because of a promise of marriage or a good job. They are usually detained for days and are abused â€Å"until they learn to service up to 25 clients a day†. Others undergo training before being entering the trade. Training may be a â€Å"constant exposure to pornographic films, tutorials in how to please customers [and] repeated rapes† (Hughes, et.al, n.d.). Trafficking women from Nepal to India is fairly easy work because of a 1,740-mile open border. In fact, it is even less risky than transporting illegal drugs into the country. Traffickers can also easily bribe police officers in an instance that they are caught. The traffickers get the women from the isolated districts of Nepal where the illiteracy rate is high. Such locations are Sindhupalchow, Makwanpur, Dhading and Khavre (Hughes, et.al, n.d.). Media Perspective The media refers to human trafficking as an overly heinous crime. On the other hand, some media entities believe that human trafficking has not been receiving adequate attention from the government. The media suggest that steps should be taken to halt human trafficking. Trafficking is dubbed as a very heinous crime because people make a profit out of the violation of another person’s rights (Mulford, 2006). Trafficking is also a crime that has been given less attention compared to other horrors like suicide bombings and other acts of violence (Matysik, 2006). This is because other violent crimes are widely publicized like terrorists that want to strike fear into the hearts of people while human trafficking remains to be an underground business. One analysis indicates that the public has gained a distorted view of the issue since the media has been vent on exposing incidents of the trafficking of women and girls being forced into prostitution which fuels a moral panic. This diverts the public view out of other forms of human trafficking like forced labour (Fahy McDevitt, 2006). The United Nations Global Initiative to Fight Human Trafficking has also identified that these media stereotypes should be eliminated. Human trafficking, prostitution and smuggling should be confused with the one another. Marija Andelkovic, President of the anti-trafficking NGO ASTRA has something to say on the issue (UNGIFT, 2008). Media power should be used to press authorities and society in general to tackle the factors that drive human trafficking. â€Å"And the greatest contribution would be to write about human trafficking as a serious social problem which is very complex and has different aspects,† says Andelkovic. In that way, journalists will help fight crime.† (UNGIFT, 2008) The media must also make an effort to protect the identities of victims of human trafficking if ever they are to interview one since much of human trafficking is controlled by organized crime and the victim could be in danger if his/her identity is exposed. Nonetheless, writing about human trafficking will not always require that a victim be interviewed. The story can be framed in a variety of ways such that highlighting it as an organized crime or something that would urge the government to intensify efforts against it (UNGIFT, 2008). According to the Loquitur, the subject of human trafficking is finally getting the attention that it deserves. The awareness of the issue is increasing especially as different organizations have been battling with the issue. Influential celebrities such as Oprah Winfrey who hosts the talk show Oprah have also sparked public attention on the issue. These have urged governments to act which includes drafting laws and setting up entrapment operations to catch human traffickers (Matysik, 2006). Recognizing human trafficking has been identified as an important issue and the Indian government has started to address the problem (Mulford, 2006) especially since the situation in India has now been identified by the media as â€Å"grim†. However, the actions by the Indian government to combat human trafficking has still has been deemed lacking. â€Å"In Mumbai, convictions for trafficking-related offences increased from three in 2003 to 11 thus far in 2004 but remain grossly unrepresen tative in a city of over 18 million inhabitants† (Human trafficking situation, 2005). UN.GIFT also supports that the media is an important tool in the fight against human trafficking. The UN.GIFT regional event in Vilnius gave focus on this aspect.

Stifle, already!

Stifle, already! Stifle, already! Stifle, already! By Maeve Maddox Reader Brad Kruse came across this comment from the reader of a rabidly anti-health insurance reform site: die eisernen Stiefel (the iron jackboots) of Obamistas are methodically and systematicly [sic] destroying the very core of our country. Brad’s question has to do with the German word Stiefel, not politics: What I noticed was Steifel.   As in the old Archie Bunker, â€Å"Stifle yourself, Edith!†Ã‚  Does stifle come from boot, as in â€Å"put a boot in it?† No, there’s no connection between German Stiefel and English stifle. The boot-in-the-mouth image, however, certainly suits Archie’s personality. The word stifle has been in English with the sense of â€Å"to choke, suffocate, drown† since 1387. It may have entered English by way of Old French estouffer, â€Å"to stifle, smother.† The French word in turn may derive from a Germanic source: Old High German stopfen, â€Å"to plug up, stuff.† Archie’s metaphorical sense of the word has been around since 1577. The expression eisernen Stiefel, literally â€Å"iron boot† is usually translated into English as jackboot. A jackboot is a type of strong high boot without laces worn by farmers, motorcycle riders and soldiers. Because such boots were part of the Nazi uniforms in WW II, jackboot has taken on metaphorical associations with totalitarian government. Speaking figuratively, â€Å"jackboot tactics† are brutal and oppressive methods of control exercised by totalitarian dictators. Want to improve your English in five minutes a day? Get a subscription and start receiving our writing tips and exercises daily! Keep learning! Browse the Vocabulary category, check our popular posts, or choose a related post below:100 Whimsical Words25 Russian Words Used in English (and 25 More That Should Be)Predicate Complements

The Conspiracies Surrounding the Assassination of John F. Kennedy Research Paper

The Conspiracies Surrounding the Assassination of John F. Kennedy - Research Paper Example It is evident from the opinion poll conducted by ABC News in 2003 wherein 70 percent of the people did not approve of the fact that Oswald planned the assassination by himself, and no outside forces were involved in the plotting. Their argument was that bullets aimed at from the sixth floor of the Texas School Book Depository could not have succeeded in aiming at the President. They felt the presence of another gunman, possibly aiming at from the Grassy knoll of Dealey Plaza. There were still others who felt that President Kennedy was assassinated under a greater conspiracy. Doubt has been expressed over the role of CIA agents who might have shown their anguish over the Bay of Pigs or at the provocation of Vice President Lyndon Johnson. KGB functionaries were also under the scanner besides mobsters who were annoyed at Kennedy's brother for prosecuting organized crime rings. Thus, the assassination of President Kennedy was one of history's most famous political assassinations whose ca use and culprits are still not confirmed. Amid rumors, 32 percent of those polled by ABC think that Oswald acted on his own (Time Specials par. 1-2) Facts There are numerous conspiracy theories doing the rounds around the assassination of President Kennedy. After being arrested, Oswald was shot at and murdered by Jack Ruby not long after being arrested. General opinion was that it was Oswald who assassinated the President but he was not alone. People had doubts over the KGB, the FBI, and the American underworld. Most of the witnesses were not sure as to from which direction the bullets came, strengthening the theory that there were more than one shooter.

Media Studies Case Study Example | Topics and Well Written Essays - 2500 words

Media Studies - Case Study Example Advertising is persuasive and informational and is designed to influence the purchasing behavior and/or thought patterns of the audience. Advertising is a marketing tool and may be used in combination with other marketing tools, such as sales promotions, personal selling tactics, or publicity" (Advertising, p.1). In our everyday lives, we are surrounded by advertisements all over. It is nearly impossible to save ourselves from one or the other kind of advertisements whether it might be the most recent offer put forward by the local supermarket or perhaps even an advertisement on the television even if we stop reading the newspaper, stop watching television or even stride around with our eyes closed. As mentioned previously, the chief rationale of marketing is to advertise and sell products, but if one ponders, we come to realize the fact that the advertisement not only sells the product to people, but it also puts forward an image of our future which is extremely attractive and full of opportunities and advantages. For this particular essay, an advertisement will be analyzed with respect to semiotic terms and techniques and discourse analysis, and discover how denotation is constructed. The methods chosen for the analysis of the advertisement are the most appropriate methods. This is because through the semiotics and discourse analysis, the advertisement of Chrysler 300C chosen can be best analyzed as it contains the language and signs that require appropriate understanding and analysis that can only be done through the use of semiotics and discourse analysis.The next section presents the concepts of semiotics and discourse analysis that is discussed through the analysis of the literature present in different books, journals, periodicals and internet sources. The literature is reviewed through these sources and then discussed and critically analyzed. Semiotic and Discourse Analysis In the course of the method of being advertised, merchandise turns into an illustration of anything and everything that is desirable for the general public or at least the target market. The basic working of an advert basically is to indicate, to correspond to us, the object of our most unavoidable desires. We can therefore argue that the most important aspect of an advertisement is of what is important to us. For an advertisement to be successful it needs to put forward an image of us and to tell us ways by which we can use the product to make ourselves even more tempting, striking etc. In this way the product is given individuality, communicating to the target market not just plain information but also representation. The advert under consideration is the Chrysler 300C advertisement. The methods that have been taken up are known as Semiotics and Discourse Analysis. A commonsensical way to start here would be by defining Semiotics first. Basically, Semiotics was developed in the 1960s and has its roots in English literature and structural linguistics.

Experiment of Calcium Carbonate Composition of Eggshells

Experiment of Calcium Carbonate Composition of Eggshells INTRODUCTION Calcium carbonate, CaCO3, is found in nature giving hardness and strength to things such as seashells, rocks, and eggshells. As hard as this substance is, it will react readily with hydrochloric acid to yield carbon dioxide gas (and two other products). In this experiment students will design an experiment by reacting eggshells with 2 M HCl to compare the calcium carbonate composition of white (chicken) eggshells to brown eggshells. A good quality eggshell will contain, on average, 2.2 grams of calcium in the form of calcium carbonate. Approximately 94% of a dry eggshell is calcium carbonate and has a typical mass of 5.5 grams,1 although these values can differ depending on sources. Amounts as low as 78% have been published. The remaining mass is composed largely of phosphorus and magnesium, and trace amounts of sodium, potassium, zinc, manganese, iron, and copper. In the case of brown versus white eggs, a definitive difference in calcium carbonate amounts may be hard to uncover. However, consider this. The color of the eggs is nothing more than a result of a different breed. The quality, nutritional value, and taste are identical between white and brown eggs, though two notable differences are size and price. Brown eggs are usually larger and slightly more expensive. The reason for the price increase is because brown eggs come from larger hens, which need to be fed more food daily. With a larger intake of calci um each day, one might expect the produced egg to have a higher calcium carbonate content. However, since the eggs are larger, it must be kept in mind that the calcium is spread over a larger surface area during egg formation. A brown eggshells increased tendency to break, when compared to white, is often attributed to this â€Å"thinning out† of calcium during deposition. To avoid the breakage of eggs before reaching market, the eggshells needs to be as strong as possible. The strength of eggshells is mainly determined by the percentage of calcium carbonate in it. In order to monitor the quality of eggshells, the following experiment has to be done to determine the percentage of calcium carbonate in eggshells. In this experiment, back titration is used. First, excess acid is reacted with the calcium carbonate in eggshells. 2HCl(aq)+CaCO3(s)→CaCl2(aq)+H2O(l)+CO2(g) Later, if we can find out the number of mole of unreacted acid, number of mole of calcium carbonate can then be found out. The number of mole of unreacted acid can be found by titration with the following reaction. HCl(aq)+NaOH(aq)→H2O(l)+NaCl(aq) Percentage by mass of calcium carbonate in eggshell can then be calculated by the following formula: 4.2AIMS AND OBJECTIVES The purpose of this experiment is to determine the percentage by mass of calcium carbonate in eggshells. design an experiment that quantifies the amount of calcium carbonate present in a natural substance. relate the amount of a reactant or product of a chemical reaction to another reactant or product. work collaboratively with their peers to solve a given problem in the laboratory in a way that models the scientific method. apply a common acid reaction between hydrochloric acid and the carbonate ion. Chapter 2 THEORY METHOLOGY PRINCIPLE OF THE EXPERIMENT During this experiment, the percentage of CaCO3 in an eggshell is determined by reacting the eggshell with hydrochloric acid. The equation for this reaction is: 2HCl (aq) + CaCO3(s)→Ca2+ (aq) + CO2 (g) + H2O (l) + 2Cl- (aq) This reaction cannot be used directly titrate with the CaCO3. Instead, an excess of hydrochloric acid is added to dissolve the eggshell, and the remaining acid is titrated with NaOH solution to determine the amount of acid that did not react with the eggshell. The equation used to determine the amount of leftover acid is: HCl (aq) + NaOH (aq) → H2O (l) + Na+ (aq) + Cl- (aq) APPARATUS AND EQUIPMENTS Beaker Pipette Filler Electronicbalance Volumetric flask BuretteWash bottle Mortar and pestle Conical flasks White tile Filter funnel Filtter paper 25.00 cm 3 pipette CHEMICALS USED 2 M HCl Phenolphthalein 2 M NaOH PROCEDURE White and Red colour eggshells have taken and the protein membrane was removed on the inside of the eggshells. The eggshell was washed with distilled water Dried in an oven for few minutes. The eggshell was then grounded into fine powder by mortar and pestle. 2g of eggshell powder is weighted accurately by using an electronic balance and it was transferred to a conical flask. 25.00 cm3 of HCl was pipetted to dissolve the eggshell powder. Distilled water was added to the flask until it reached about 100cm3. The flask was swirled gently. Put the solution into cubed for two days. Faltered the solution using filter papers. Pippet out 25.00 cm3 from each solutions to titration flasks. The solution was then titrated with standardized NaOH. Repeat another two samples from each solution. Collect the correct burette readings at the end point. Chapter 3 EXPERIMENTAL RESULTS THE COLOR CHANGE OF THE SOLUTION White egg Brown egg Colourless pink Colourless pink THE TITRATION RESULT OF BROWN EGG 1 2 3 Volume of eggshells solution/cm3 25.00 25.00 25.00 Volume of NaOH used/cm3 20.10 19.90 20.10 Average volume of NaOH used: (20.10+19.90+20.10) = 20.03cm33 THE TITRATION RESULT OF WHITE EGG 1 2 3 Volume of eggshells solution/cm3 25.00 25.00 25.00 Volume of NaOH used/cm3 20.40 20.35 20.00 *Average volume of NaOH used: (20.40+20.35+20.00) =20.25cm33 Chapter 4 CALCULATIONS CALCULATIONS 2HCl (aq) + CaCO3(s)→Ca2+ (aq) + CO2 (g) + H2O (l) + 2Cl- (aq) HCl (aq) + NaOH (aq) → H2O (l) + Na+ (aq) + Cl- (aq) FOR BROWN EGG Number of moles of NaOH used to react with HCl =20.03cm3 /1000) X2M = 40.06X 10-3 mol Since number of moles of NaOH = number of moles of HCl in 25cm3 =40.06 X 10-3 mol HCl mols in 100cm3 = 40.06 X 10-3 X 4 mol The initial no of moles of HCl: volume X molarity = 100/1000 X2M = 200X10-3 mol Number of moles of HCl used to react with CaCO3 = ( 200X10-3 160.24X 10-3) mol = 39.76X10-3 mol According to the equation, one mole of HCI required to react with 2 moles of CaCO3, Number of moles of CaCO3 reacted =39.76X10- 3 /2 = 19.88X10-3 mol The weight of CaCO3 = 19.88X10-3g X100g The % of CaCO3 in eggshell (brown) = (1.988/2) X100% =99.4% FOR WHITE EGG Number of moles of NaOH used to react with HCl: (20.25cm3/1000)X2 = 40.50X10-3mol Since number of moles of NaOH=number of moles of HCl in 25cm3 = 4.50X10-3mol HCl Volume in 100cm3 = 40.50 X10-3 X4 mol The initial moles of HCl: volume X molarity = 100/1000 X2M = 200X10-3 mol Number of moles of HCl used to react with CaCO3 : ( 200X10-3 162X10-3) mol = 38X10-3 mol Number of moles of CaCO3 reacted =38X10-3/2 = 19X10-3 mol The weight of CaCO3 = 19X10-3g X100 The % of CaCO3 in eggshell (white) = (1.9/2) X100% =95.0% Chapter 5 DISCUSSION AND CONCLUTION CONCLUSION Percentage of CaCO3 in red eggshells= 99.4% Percentage of CaCO3 in white eggshells= 95.0% Therefore red eggshells has the higher percentage of CaCO3. DISCUSSION Source of errors The eggshell powder did not dissolve completely Variation in visual judgment at the end point Instrumental errors of the electronic balance The eggshell was not fully dried Some droplets of solution may still adhere on the beaker and the glass rod which lead to the reduction in number of moles of excess HCl In this Experiment we can also do the EDTA titration. REFERENCES http://www.google.lk/search?hl=ensource=hpq=caco3+percentage+in+eggshellbtnG=Google+Searchmeta=aq=foq= http://wwwchem.csustan.edu/chem1102/Egg.htm http://www.oppapers.com/essays/Determine-Percentage-Mass-Calcium-Carbonate-Eggshells/165593 http://ag.ansc.purdue.edu/poultry/multistate/koelkebeck1.htm