Armenian-Cypriots

Armenian-Cypriots

Armenians in Cyprus or Armenian-Cypriots (Armenian: Կիպրահայեր, Greek: Αρμενοκύπριοι) are ethnic Armenians who live in Cyprus. The relation of Armenians with Cyprus and their presence on the island are very old and there has been a mutual economic and cultural association for the last centuries. Sony Vaio VGN-NS10L/S Battery

Armenians in Cyprus are a community with a long history and their presence has enriched the island in several ways. They are a recognised minority with their own language, schools, churches, cemeteries, Sony Vaio VGN-NS10E/S Battery

monuments, media, social institutions and cultural life. The number of Armenians in Cyprus has decreased due to emigrations to other countries and integration into the rest of Cypriot society, including intermarriage;

 

Sony  VGP-BPS21A/b Battery their number today is smaller than a few generations ago. Economically, Armenian-Cypriots have tended to be self-employed businessmen/merchants, professionals or craftsmen.

 

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Despite the relatively small number of Armenians living in Cyprus, the Armenian-Cypriot community has had a significant impact upon the Armenian Diaspora and the Armenian nation in general: during the Middle Ages,

Sony  VGP-BPS21B BatteryCyprus had an extensive connection with the Armenian Kingdom of Cilicia, while the Ganchvor monastery had an important presence; during the Ottoman Era, the church of Sourp Asdvadzadzin and the Sourp Magar monastery were very prominent. In modern times, Sony Vaio VGN-NS11J/S Battery

 

the short-lived National Educational Orphanage and the famous Melkonian Educational Institute were very influential; the presence of the Armenian Legion in Cyprus is also worth mentioning, while the emigration of a large number of Armenian-Cypriots in the United Kingdom virtually shaped today’s British-Armenian community. Sony Vaio VGN-NS20E/P Battery

Also worth mentioning is the fact that certain Armenian-Cypriots were or are very prominent on a Pan-Armenian or international level and that the survivors of the Armenian Genocide co-existed peacefully with the Turkish-Cypriots. Sony Vaio VGN-NS20J/P Battery

Additionally, the history and the various other aspects of the Armenian community of Cyprus are extremely well-documented. Finally, Cyprus was the first country to bring the issue of the Armenian Genocide recognition to the plenary session of the United Nations General Assembly in 1965 and the second country in the world to recognise the Armenian Genocide in 1975. Sony Vaio VGN-NS20M/S Battery

Currently, Armenian-Cypriots maintain a notable presence of about 3.500 on the island (including a number of non-Cypriot Armenians, mainly from Armenia, Georgia, Lebanon, Russia and Syria),[1] mostly centred around the capital Nicosia, but also with communities in Larnaca and Limassol, where they have churches,

 

Sony  VGP-BPS21A Batteryschools, associations, cemeteries, monuments and newspapers; there is also a small unstructured Armenian community in Paphos (all of them originating from Armenia).[2] The Armenian Prelature of Cyprus is based in Nicosia. According to the 1960 Constitution of Cyprus, together with the Maronites and the Latins,Sony Vaio VGN-NS30E/S Battery

they are recognised as a “religious group” and have opted to belong to the Greek-Cypriot community. Armenian-Cypriots are represented by an elected Representative in the House of Representatives; since May 2006, the Representative is Vartkes Mahdessian, a prominent businessman from Nicosia, who was re-elected in May 2011 for a new term in the Cyprus House of Representatives.[3] The religious leader of the community, since August 1997, Sony Vaio VGN-NS30Z/S Battery

is Catholicosal Vicar Archbishop Varoujan Hergelian, accountable to the Catholicos of the Great House of Cilicia.

There is a long link between the Armenians and Cyprus, possibly dating back to the 5th century BC. However, Armenians have had a continuous documented presence in Cyprus since 578 AD: during his campaign against the Persian King Chosroes I, Sony Vaio VGN-NS20EF/P Battery

General Maurice the Cappadocian captured 10.090 Armenians as prisoners in Arzanene (Aghdznik), of whom about 3.350 were deported to Cyprus.[4] Judging by the strategic position of the colonies they established (Armenokhori, Arminou, Kornokipos, Patriki, Platani, Spathariko and perhaps Mousere), it is very likely that these Armenians served Byzantium as mercenary soldiers and frontiersmen.

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More Armenians arrived during the reign of Armenian-descended Emperor Heraclius (610–641) for political reasons, during the pontificate of Catholicos Hovhannes Odznetsi (717–728) for commercial reasons and after the liberation of Cyprus from the Arab raids by patrician Niketas Chalkoutzes (965) for military reasons.

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In the mid-Byzantine period, Armenian generals and governors served in Cyprus, like Alexios Mousere (868–874), Basil Haigaz (958), Vahram (965), Elpidios Vrakhamios (1075–1085) and Leo of Symbatices (910–911), who undertook the construction of Saint Lazarus’ basilica in Larnaca. The numerous Armenians required an analogous spiritual pastorate, and so in 973 Catholicos Khatchig I established the Armenian Bishopric in Nicosia.

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Relations between Cyprus and the Armenians became more intense when the Kingdom of Cilicia was established. The Kingdom, on the coast of Cilicia, to the north of the island, was established at around 1080 AD by Armenian refugees who fled the Seljuk invasion to the north and remained an ally of Byzantium. Between 1136–1138,

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Emperor John II Comnenus moved the entire population of the Armenian city of Tell Hamdun to Cyprus. After Isaac Comnenus’ wedding to the daughter of the Armenian prince Thoros II in 1185, Armenian nobles and warriors came with him to Cyprus, many of whom defended the island against Richard the Lionheart (1191) and the Knights Templar (1192).[5] Sony Vaio VGN-NS20EF/S Battery

 

[edit]Latin Era

Ganchvor monastery in Famagusta

Saint Lazarus’ basilica in Larnaca

After the purchase of Cyprus by titular Frankish King of Jerusalem Guy de Lusignan in 1192, a massive immigration of Armenians and other peoples from Western Europe, Cilicia and the Levant took place (mainly Franks, Latins and Maronites, as well as Copts, Ethiopians, Georgians, Jacobites, Jews, Melkites, Nestorians and others).

Sony  VAIO VGP-BPS13B/S BatteryTo these bourgeois, noblemen, knights and warriors fiefs, manors and privileges were bounteously granted. Because of their proximity, their commercial ties and a series of royal and nobility marriages, the Kingdom of Cyprus and the Kingdom of Cilicia became inextricably linked. In the subsequent centuries,

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thousands of Cilician Armenians sought refuge in Cyprus fleeing the Muslim hordes and attacks: the Fall of Jerusalem (1267), the Fall of Acre (1291), the attack of the Saracens (1322), the Mameluke attacks (1335 and 1346) and the Ottoman occupation (1403 and 1421). Sony Vaio VGN-NS20EF/W Batteryx

The Fall of Sis in April 1375 put an end to the Kingdom of Cilicia; its last King, Levon V, was granted safe passage to Cyprus and died in exile in Paris in 1393, after calling in vain for another Crusade. In 1396, his title and privileges were transferred to his cousin, King James I de Lusignan, in the Saint Sophia cathedral; subsequently,

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the royal crest of the Lusignan dynasty also bore the lion of Armenia. Thus ended the last fully independent Armenian entity of the Middle Ages after nearly three centuries of sovereignty and bloom. The title was then held through the centuries down to the modern day by the House of Savoy,

 

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through the marriage of Queen Charlotte of Cyprus to Louis of Savoy. Although the Egyptian Mamelukes had taken over Cilicia, they were unable to maintain their hold on it; Turkic tribes eventually made their way to the region and established themselves there, leading to the conquest of Cilicia by Tamerlane. As a result,

 

Sony  VAIO VGP-BPS13A/B Battery30.000 Armenians left Cilicia in 1403 and settled in Cyprus, which continued to be ruled by the Lusignan dynasty until 1489.[6]

During the Frankish and the Venetian Eras (1192–1489 & 1489–1570), there were Armenian churches in Nicosia, Famagusta, Spathariko, Kornokipos,

Sony  VGP-BPS13 Battery    Platani, Piscopia and elsewhere, while Armenian was one of the official languages of Cyprus. The Armenians of Nicosia had their Prelature and used to live in their own quarter, called Armenia or Armenoyitonia. In Famagusta, a Bishopric was established in the 12th century and Armenians lived around the Syrian quarter. Historical documents suggest the presence of an important monastic and theological centre there, at which Saint Nerses Lampronatsi (1153–1198) is said to have studied;Sony Vaio VGN-NS20EF/W Battery of the three Armenian churches of walled Famagusta, only Ganchvor survives, built in 1346. By 1425, the renowned Magaravank – originally the Coptic monastery of Saint Makarios near Halevga (Pentadhaktylos region) – came under Armenian possession, as did sometime before 1504 the Benedictine nunnery of Notre Dame de Tyre or Tortosa (Sourp Asdvadzadzin) in walled Nicosia. During the Latin Era, there was also a small number of Armenian Catholics in Cyprus. Sony Vaio VGN-SR49VN/H Battery

[edit]Ottoman Era

The Magaravank monastery

During the Osmanian occupation of the island (1570–1571), about 40.000 Ottoman-Armenian craftsmen were recruited (mainly sappers). Many of the ones who survived the conquest settled mainly in Nicosia, while the Armenian Prelature was recognised as an Ethnarchy (Azkayin Ishkhanoutiun), via the millet institution.

Sony Vaio VGN-SR49VT/H Battery However, the Bishopric in Famagusta was abolished, as the entire walled city became forbidden for non-Muslims until the early years of the British Era. Gifted with the acumen of industry, Armenians practised lucrative professions and in the beginning of the 17th century Persian Armenians settled in Cyprus as silk traders, as did some affluent Ottoman-Armenian families in the 18th and 19th century. However, Sony Vaio VGN-FW56Z Battery

 

with the new order of things, the number of Armenians and other Christians dramatically declined due to the onerous taxation and the harshness of the Ottoman administration, compelling many Christians to become Linobambaki (Crypto-Christians) or to embrace Islam,

 

Sony Vaio VGN-FW56SR Batterywhich explains why former Armenian villages (Armenokhori, Artemi, Ayios Iakovos, Ayios Khariton, Kornokipos, Melounda and Platani) were inhabited by “Turkish-Cypriots” at the end of the 19th century; a few Armenians-Cypriots became Catholics through marriage with affluent Latin families. Sony Vaio VGN-SR57S Battery

The Eramian Farm House in Dheftera

Gradually, after the bloody 1821 events, some improvements were observed during the Tanzimat period (1839–1876), resulting in the participation of the Armenian Bishop in the Administrative Council (Meclis İdare) and the employment of some Armenians in the civil service. Sony Vaio VGN-SR57V Battery

Additionally, the opening of the Suez Canal in 1869 benefited the Armenian and other merchants of the island. Throughout the Ottoman Era (1571–1878), the vast majority of the Armenian population of Cyprus had been Armenian Orthodox, although there is also mention of a small Armenian Catholic community in Larnaca.

Sony Vaio VGN-FW56ZR BatteryOf the three religious groups, the Armenians are the only ones to have a continuous presence of Prelates throughout the Osmanian occupation. Based on various estimates, the Armenian-Cypriot community of the 19th century numbered between 150–250 persons, the majority of whom lived in Nicosia,

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with smaller numbers living in Famagusta, Larnaca, the north and south of Nicosia (especially in Dheftera and Kythrea) and, naturally, in and near Magaravank.[5]

[edit]British Era

 

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Orphaned Armenian scouts (1927)

With the arrival of the British in July 1878 and their progressive administration, the already prosperous yet small Armenian community of the island was particularly strengthened. Known for their linguistic skills,

Sony Vaio VGN-SR59TH/H Battery several Armenians were contracted to Cyprus to work as interpreters and public servants at the consulates and the British administration. The number of Armenians in Cyprus significantly increased following the massive deportations, the horrific massacres and the Genocide perpetrated by the Ottomans and the Young Turks (1894–1896, 1909 & 1915–1923). Sony Vaio VGN-SR57X BatteryCyprus widely opened its arms to welcome over 10.000 refugees from Cilicia, Smyrna and Constantinople, who arrived in Larnaca and all its other harbours, some by chance, others by intent; about 1.500 of them made the island their new home. Industrious, cultivated and progressive, Sony VPCF11C4E/B Battery

 

they brought new life into the old community and did not need long to find their feet and establish themselves as people of the arts, letters and sciences, able entrepreneurs and formidable merchants, unsurpassed craftsmen and photographers, as well as pioneering professionals who introduced new crafts, Sony VPCF11C5E Battery

dishes and sweets to the island, thus significantly contributing to Cyprus’ socioeconomic and cultural development.[7]

The newcomers established associations, choirs, sports groups, scouts groups, bands, churches, schools and cemeteries in Nicosia, Larnaca, Limassol, Famagusta, Amiandos and elsewhere, while soon Armenophony became a reality. Sony VPCF11D4E Battery

Armenians were the first locksmiths, mechanics, seat, comb and stamp makers, upholsterers, watchmakers and zincographers in Cyprus. They were the first to introduce the cinema, they significantly improved the craft of shoemaking and it was Armenians who first introduced Armenian bastourma, baklava, Sony VPC-F11M1E/H Battery

dried apricots, gassosa, gyros, ice cubes, koubes, lahmadjoun, lokmadhes and pompes into the Cypriot cuisine – all very popular today. There were also some Armenian factory owners (ice makers, soap makers, sock makers, tanners etc.), but above all, there was a disproportionately large number of Armenian photographers. Sony VPCF11S1E/B Battery

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Law-abiding by nature, Armenian-Cypriots always had a high profile with the British administration and many became conscientious civil servants and disciplined policemen or were employed at the Cyprus Government Railway and at Cable and Wireless. Sony VPC-F2 Battery

Throughout the 1920s–1950s, many worked at the asbestos mines at Amiandos and the copper mines at Mavrovouni and Skouriotissa, some of whom had been trade unionists. Some Armenian-Cypriots participated in the 1897 Greco-Turkish War, the two World Wars (1914–1918 & 1939–1945) and the EOKA liberation struggle (1955–1959). Sony VPC-F21Z1E Battery

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Also, the Eastern Legion (later called Armenian Legion) was formed and trained between December 1916 and May 1918 in Monarga village, near Boghazi, consisting of over 4.000 Diasporan Armenian volunteers who heroically fought against the Ottoman Empire. Some Armenian refugees arrived from Palestine (1947–1949) and Egypt (1956–1957).[6] Sony VPCF22L1E Battery

Visit of Armenian-Cypriots at the Magaravank in 1947

The Armenian-Cypriot community prospered throughout the British Era (1878–1960), by establishing associations, choirs, scout groups, sports teams, musical ensembles, churches, cemeteries and schools, including the renowned Melkonian Educational Institute. In many ways unique across the whole Armenian Diaspora, Sony VPCF22M1E Battery

it was built just outside Nicosia between 1924–1926, after the generous and benevolent donation of the Egyptian-Armenian tobacco trading brothers Krikor and Garabed Melkonian, initially in order to shelter and educate 500 orphans of the Genocide,

Sony VPCF12F4E/H Battery who planted the trees in front of the school in memory of their slaughtered relatives. From an orphanage (1926–1940), it gradually became a world-renowned secondary school with a boarding section (1934–2005).[8] Sony VPCF22S1E Battery

Examining the population censuses of the British Era (see Demography section), we observe a fluctuation in the number of Armenians in Cyprus, ranging from 201 in 1881 to 4.549 in 1956. In their vast majority they were Armenian Apostolic, but there were also a small number of Armenian Catholics and Armenian Protestants.

 

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In the 1960 population census, 3.628 Armenians were recorded – in contrast to 4.549 in 1956 – as about 900 Armenian-Cypriots had emigrated to Great Britain and elsewhere, due to the emergency situation caused by the EOKA liberation struggle (1955–1959) and the uncertainty that some felt with the departure of the British, whom they viewed as their protectors. In fact, a large portion of British-Armenians hail from Cyprus.[6] Sony VPCF22S8E Battery

[edit]Independence Era

The old Armenian church in Nicosia

The 1960 Independence brought a new era for the Armenians of Cyprus, who – together with the Maronites and the Latins – were recognised as a “religious group” by the Constitution and were now represented by an elected Representative. Sony VPCF23M1E Battery

The size of the community, however, had been reduced because of the emigration of about 900 Armenian-Cypriots to the United Kingdom, due to the emergency situation caused by the EOKA liberation struggle (1955–1959).

Sony VPCF11Z1E/BI Battery A second factor that contributed to the reduction of the community’s size was the emigration of about 600 Armenian-Cypriots to Soviet Armenia, as part of the Panarmenian movement for “repatriation” during the 1962–1964 period (nerkaght).[9]

 

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During the 1963–1964 inter-communal troubles, the Armenian-Cypriot community suffered major losses, as the Armenian quarter of Nicosia was captured by extremist Turkish-Cypriots: taken were the Prelature building,

Sony VPCF11S1E Batterythe Sourp Asdvadzadzin church, the Melikian-Ouzounian school, the Genocide Monument, the Armenian Club, AYMA and AGBU and the Armenian Evangelical church; also taken was the Ganchvor church in Famagusta. In total, 231 Armenian-Cypriot families became victims to the Turks and/or lost their shops and enterprises. As a result, many Armenian-Cypriots left for Great Britain,

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Canada, Australia and the United States.[7] After the 1974 Turkish invasion, the Armenian-Cypriot community suffered additional losses: about 4–5 families living in Kyrenia, 30 families in Nicosia and 40–45 families in Famagusta became refugees, while an Armenian-Cypriot lady (Rosa Bakalian) has been missing since then;

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the renowned Magaravank monastery in Pentadhaktylos was taken by the Turkish troops, the Melkonian boys’ building was bombed by the Turkish Air Force, while the Ayios Dhometios Armenian cemetery fell within the buffer zone. As a result, some Armenian-Cypriots emigrated, mainly to Great Britain.[5]

 

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The Armenian compound in Strovolos, Nicosia

Despite its losses and with the unfailing support of the government, the small yet industrious Armenian community of Cyprus continued to prosper in the remaining urban areas, contributing culturally and socioeconomically to the development of our homeland. On 24 April 1975, Sony VPCF23Q1E Battery Cyprus became the first European country (and the second world-wide, after Uruguay) to recognise the Armenian Genocide with Resolution 36/1975; two more resolutions, Resolution 74/1982 and Resolution 103/1990 followed, Sony VPCF22M1E Battery 

with the latter declaring 24 April as a National Remembrance Day of the Armenian Genocide in Cyprus. Over the past decades, the dynamics of the Armenian-Cypriot community have changed with the increased number of marriages with Greek-Cypriots and the arrival over the last 30–35 years of thousands of Armenian political and economic immigrants because of the civil war in Lebanon (1975–1990),

 

Sony VPCF23N1E Battery the insurgencies in Syria (1976–1982), the Islamic revolution in Iran and the Iran-Iraq war (1978–1988), as well as after the Spitak earthquake (1988) and the dissolution of the Soviet Union(1991); some of them have settled permanently in Cyprus. According to the European Charter for Regional or Minority Languages of the Council of Europe, Sony VPCF11M1E/H Battery 

the Armenian language – the mother tongue of the vast majority of Armenian-Cypriots – was recognised as a minority language of Cyprus as of 1 December 2002. Today, it is estimated that Armenians living in Cyprus number over 3.500 persons; other than the countries mentioned above, in Cyprus there is also a small number of Armenians coming from Ethiopia, Greece, Kuwait, Turkey and the United Kingdom.[10]

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[edit]Demography

Geographical distribution of Armenian-Cypriots

It appears that during the very first years of the Ottoman Era (1570–1878), about 20.000 Armenians used to live in Cyprus. Their number, however, rapidly declined, due to the harshness and the oppression of the regime,

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the onerous taxation and natural disasters. In the mid–19th century, the number of Armenian-Cypriots ranged between 150–200, according to the censuses of the Ottoman Empire, the Armenian Prelature and the estimations of European travellers.

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The British colonial censuses that took place between 1881 and 1956 provide us with fairly accurate data on the Armenian population of Cyprus. The following numbers are the combined figures of those recorded as Armenian (by religion) and those recorded as speakers of Armenian. In 1881 there were 201 Armenians in Cyprus,

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who increased to 291 in 1891 and 553 in 1901; the numerical increase was due to the influx of Armenian refugees from the Hamidian massacres. In 1911 there were 616 Armenians, while in 1921 their number rose to 1.573 and to 3.617 in 1931, as a result of the huge wave of refugees from the Armenian Genocide.

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In 1935 the Armenian Prelature recorded 3.819 Armenians in Cyprus. In 1946 there were 3.962 Armenians in Cyprus, while in 1956 they numbered 4.549.[6] The table below shows the geographical distribution of Armenian-Cypriots per district from 1881 through 1960.

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Table showing the geographical distribution of Armenian-Cypriots

The last accurate census of the population of Cyprus with regard to its ethnic breakdown was carried out in 1960; it recorded 3.628 Armenians. In 1978 and 1987 the Armenian Prelature recorded the Armenian population of Cyprus,

Sony VPCF22S1E Battery which was 1.787 and 2.742, respectively. Currently, about 3.500 Armenians live in Cyprus; 65% live in the capital, Nicosia, 20% in Larnaca, 10% in Limassol and 5% in Paphos and some villages. Over 95% of the Armenian population speak Armenian and are Armenian Orthodox (also known as Armenian Apostolic or Gregorian); 

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some 5% belong either to the Armenian Evangelical Church, the Armenian Catholic Church, the Latin Church, the Greek Orthodox Church, the Anglican Church, the Plymouth Brethren Church, the Seventh-day Adventist Church or they are Jehovah’s Witnesses.Sony VPCYB2M1E BatteryAbout 1.000 out of the 3.500 Armenians who live in Cyprus hail from Armenia, Lebanon, Syria, Russia, Georgia, Persia, Greece, Iraq, Ethiopia, Turkey and Kuweit. Sony VPCF23Z1E Battery 

  Most of the first wave of Armenians from Armenia who arrived in Cyprus from 1991 onwards are the Armenian-Cypriots and their descendants who emigrated to Armenia between 1962–1964, as part of the “nerkaght” [ներգամթ (repatriation)] movement.

 

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Places of origin of Armenian-Cypriots

The map on the right shows the places of origin of Armenian-Cypriots, based on a survey that Archbishop Bedros Saradjian conducted in 1935. According to available information, the about 1.000 refugees from the Hamidian massacres (1894–1896) mainly originated from Diyarbakir,

 

Sony VPCF231S1E Battery Aintab and Kilis; only about 100 of them stayed. The next wave of Armenian refugees were the about 2.000 who fled the Adana massacre in 1909, most of whom returned to their ancestral homes in Adana within the same year.[11] Sony VPCF22M0E Battery 

However, the big wave of refugees – some of whom had come before and returned – were the nearly 9.000 who escaped the massive deportations, the horrific massacres and the Genocide perpetrated by the Ottomans and the Young Turks; about 1.300 of them decided to stay,

 

Sony VPCF23M1E Battery while the others eventually made arrangements to settle in other countries. These refugees came mainly from Adana and Seleucia, while there a significant number of them came from Sis, Marash, Tarsus, Caesarea, Hadjin and Aintab; smaller numbers came from the other places noted on the map, alphabetically: Adapazar, Adrianople (Edirne), Afion-Karahisar, Alexandretta (Iskenderoun),

 

Sony VPCF22S8E BatteryArapgir, Armash Baghche, Bardizag, Balian Dagh, Biredjik, Bitlis Brusa, Chemishgezek, Constantinople (Bolis) Dortyol, Edessa (Urfa), Erzerum, Eskishehir, Everek, Ikonion (Konya), Jeyhan, Kesab, Kharpert, Kutahia, Malatia, Mersin, Misis, Musa Dagh (Musa Ler), Nicomedia (Izmit), Rhaedestos (Tekirdagh), Sasun, Sebastia (Sivas), Shar, Sivri Hisar, Smyrna (Izmir), Tokat (Evdokia), Trepizond, Van, Yerzinga, Yozgat and Zeitun.[11] Sony VPCF13S1E/B Battery 

 

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[edit]Politics

Armenian-Cypriots have been politically organised since the mid–20th century. The breakdown below examines their involvement in local administration, Cypriot politics and Armenian politics.

 

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Representative Vartkes Mahdessian, Archbishop Varoujan Hergelian and MP Marios Garoyian

[edit]Local administration

With regard to local administration, Armenian participation has also been limited. Traditionally, there is the appointed mukhhtar of Nicosia’s Karaman Zade quarter (the Armenian quarter). So far, there have been 4 mukhtars:

Sony VPCF23QIE BatteryMelik Melikian (1927–1949), Kasbar Delyfer (1949–1956), Vahe Kouyoumdjian (1956–2009) and Mgo Kouyoumdjian (2011–today). Bedros Amirayan served as an appointed member of Famagusta’s municipal committee (1903–1905), Dr. Antranik L. Ashdjian served as an appointed municipal councillor and, later on, Vice Mayor, for Nicosia (1964–1970), while Berge Kevorkian served as an appointed municipal councillor for Nicosia (1970–1986).

 

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[edit]Cypriot politics

With the exception of the elected Representatives, so far there has been only one Armenian MP in the House of Representatives, Marios Garoyian. He was elected MP for the Nicosia District on 21 May 2006 with the Democratic Party. In October 2006 he became the party’s President. Sony VPCF13S0E/B Battery 

After the election of Demetris Christofias as President of the Republic of Cyprus in February 2008, Marios Garoyian was elected to the position of the Speaker of the House of Representatives, the second highest political position in Cyprus. He was re-elected MP for the Nicosia District on 22 May 2011 and served as House Speaker until June 2011. Sony VPCF12Z1E Battery 

[edit]Armenian politics

The first Armenian Genocide march in Nicosia (1975)

Despite its relatively small size, the Armenian-Cypriot community has been an active participant in Pan-Armenian politics already since the late 19th century, even though this became more established in the mid-20th century. Sony VPCF12S1E/B Battery 

All three major Armenian Diaspora parties are active in Cyprus, especially ARF Dashnaktsoutiun. It established its presence in Cyprus as early as 1897 but it was re-organised in 1947; its chapter is called Karenian, after Armen Karo, who briefly visited Cyprus, Sony VPCF12M0E/B Battery
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in order to organise the assembly of weapons for the Zeitoun Resistance. ARF Dashnaktsoutiun is affiliated with the Armenian Young Men’s Association (AYMA) in Nicosia, the Armenian Club in Larnaca and the Limassol Armenian Young Men’s Association (LHEM) in Limassol, as well as with the Armenian National Committee of Cyprus,

 

Sony VAIO PCG-8113M Battery the Armenian Youth Federation of Cyprus, the “Azadamard” Armenian Youth Centre, the Armenian Relief Society of Cyprus and the Hamazkayin Armenian Educational and Cultural Association of Cyprus, all based in Nicosia

 

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The ADL Ramgavar has officially been active in Cyprus since 1957. Its chapter is called Tekeyan, after Vahan Tekeyan, who was a professor at the Melkonian Educational Institute in the 1930s. The party has never been very active on the island, mainly because it was overshadowed by the significant presence of the AGBU,

 

Sony VAIO PCG-7134M Battery loosely affiliated with ADL Ramgavar. The newest Armenian political party in Cyprus is SDHP Hunchakian, which was set up on the island in 2005, following the split within the AGBU, which was brought about by the decision to close the Melkonian Educational Institute. SDHP Hunchakian is affiliated with the “Nor Serount” Cultural Association in Nicosia.

[edit]Armenian Genocide recognition

 

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Armenian Genocide memorial service with the participation of Greek-Cypriot politicians (2008)

On the level of the people, most Cypriots are aware of the great calamity the Armenian nation suffered during 1894–1923 and have always been supportive and sympathetic towards Armenians;

 

Sony VAIO PCG-7122M Battery  the Armenian Genocide refugees who remained in Cyprus were in the unique position of escaping from Ottoman Turks and living amicably amongst Turkish-Cypriots.

Cyprus has been one of the pioneering countries in recognising the Armenian Genocide,

 

Sony VAIO PCG-7121M Batterywhen on the 25 January 1965 Foreign Minister Spyros Kyprianou first raised the issue to the General Assembly of the United Nations. Prior to his powerful speech, a delegation comprising ARF Dashnaktsoutiun Bureau members Dr. Papken Papazian and Berj Missirlia,

 

Sony VAIO PCG-7113M Batteryas well as Armenian National Committee of Cyprus members Anania Mahdessian and Vartkes Sinanian, handed him a memorandum urging Cyprus’ support in raising the issue at the United Nations.[12]

 

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Cyprus was also the first European country (and the second world-wide, after Uruguay) to officially recognise the Armenian Genocide. On the 24 April 1975, after the determined efforts and the submission by Representative Dr. Antranik L. Ashdjian, Resolution 36 was voted unanimously by the House of Representatives.

 

Sony VAIO PCG-8Z3M BatteryRepresentative Aram Kalaydjian was instrumental in passing unanimously through the House of Representatives two more resolutions regarding the Armenian Genocide: Resolution 74/29–04–1982, submitted by the Foreign Relations’ Parliamentary Committee, and Resolution 103/19–04–1990, submitted by all parliamentary parties. Resolution 103 declared 24 April as a National Remembrance Day of the Armenian Genocide in Cyprus.

 

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Since 1965, when Cypriot government officials started participating in the annual Armenian Genocide functions, Cyprus’ political leaders are often keynote speakers in those functions organised to commemorate the Armenian Genocide. During the last years, there is usually a march starting from the centre of Nicosia and ending at the Sourp Asdvadzadzin church in Strovolos,

 

Sony VAIO PCG-8Z1M Batterywhere a commemorative event takes place in front of the Armenian Genocide Monument; other events may also take place, such as blood donations.

The Armenian-Cypriot community has traditionally had an active and structured social life. Various charity, cultural, educational and social events are organised,

 

Sony VAIO PCG-8Y3M Batterysuch as fund-raisers/bazaars, art/book exhibitions, dancing/theatre performances, balls, lunches, film screenings, camps/excursions in Cyprus and abroad, as well as lectures and commemoration ceremonies regarding Armenia, Nagorno-Karabakh, the Armenian Diaspora and the Armenian Genocide.

 

Sony VAIO PCG-8Y2M BatteryThe main venue for community events is the AYMA club and the “Vahram Utidjian” Hall, at the basement of the Armenian Prelature building, both in Strovolos, Nicosia. The “Vahram Utidjian” Hall took shape in 1998 by initiative of Archbishop Varoujan Hergelian, from the proceeds of the auction in 1994 of the art collection that Vahram Utidjian had donated to the Prelature in 1954.

 

Sony VAIO PCG-7Z1M Battery It was inaugurated on 3 February 1999 by Catholicos Aram I. More recently, some school events have taken place at the newly-built auditorium of Nicosia’s Nareg Armenian School. In the past, numerous events were organised at the Melkonian Educational Institute in Aglandjia, the Hall of the Armenian Club in Nicosia or the Hall of the old AGBU club in Nicosia.

 

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Currently, the following Armenian clubs operate in Cyprus:

AYMA (Armenian Young Men’s Association/Հայ Երիտասարդաց Միութիւն). Established in Nicosia in 1934, it is the leading Armenian-Cypriot club. Its premises are located near the Virgin Mary church in Strovolos, Nicosia, 
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on land leased by the government, and were inaugurated on 30 May 1987 by President Spyros Kyprianou. In front of its club house, there is a white marble tomb-ossuary containing some Armenian Genocide martyrs’ remains; it was unveiled on 28 April 2002 by Archbishop Varoujan Hergelian. AYMA is affiliated with the Homenetmen Pan-Armenian organisation. Sony VAIO PCG-5J1M Battery

AGBU (Armenian General Benevolent Union/Հայկական Բարեգործական Ընդհանուր Միութիւն), with chapters in Nicosia (1913), Larnaca (1912) and Limassol (1936). The Nicosia AGBU is located next to the Melkonian,

 

Sony VAIO PCG-6W1M Battery while the Larnaca AGBU is located opposite the District Archaeological Museum; the Limassol chapter currently has no club house. There was also a chapter in Famagusta (1949–1974). It is a branch of the AGBU Pan-Armenian organisation. The Nicosia premises were inaugurated on 22 October 1989 by AGBU President Alec Manougian, Sony VAIO PCG-5J4M Battery

while the Larnaca premises were inaugurated on 5 May 2011 by President Demetris Christofias. To the side of the Nicosia club house, the sandstone bust of AGBU’s founder Boghos Noubar Pasha was placed in 1991.

Sony VAIO PCG-6S4M Battery Inside the Larnaca AGBU there is a black granite commemorative plaque in Greek reading: “Η τελετή εγκαινίων του Αρμενικού Πολιτιστικού Κέντρου έγινε στις 5 Μαΐου 2011 από τον Εξοχότατο Πρόεδρο της Κυπριακής Δημοκρατίας κ. Δημήτρη Χριστόφια επί δημαρχίας Ανδρέα Μωϋσέως” (The inaugural ceremony of the Armenian Cultural Centre took place on 5 May 2011 by His Excellency the President of the Republic of Cyprus Mr Demetris Christofias during the mayorship of Andreas Moyseos).Sony VAIO PCG-5K1M Battery

 

Armenian Club (Հայ Ակումբ), which was established in Larnaca in 1931, is presently housed in rented premises opposite the Prelature of Citium. It is affiliated with AYMA.

LHEM (Limassol Armenian Young Men’s Association/Լիմասոլի Հայ Երիտասարդաց Միութիւն). Established in Limassol in 1996, it currently has no club house. It is affiliated with AYMA.

 

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“Nor Serount” Cultural Association (“Նոր Սերունդ” Մշակութային Միոեթիւն). Established in Nicosia in 2005, it currently has no club house. It is affiliated with the Homenmen Pan-Armenian organisation.

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The following associations operate within AYMA’s club house:

Armenian National Committee of Cyprus (Կիպրոսի Հայ Դատի Յանձնախումբ, 1965).

Armenian Youth Federation of Cyprus (Կիպրոսի Երիտասարդական Միութիւն, 1977).

“Azadamard” Armenian Youth Centre (Ազատամարտ Երիտասարդակամ Կեդրոն, 1985).

Armenian Relief Society of Cyprus (Հայ Օգնութեան Միութիւն, also known as HOM, “Sosse” chapter, 1988). Sony VAIO PCG-5K2M Battery

Hamazkayin Armenian Educational and Cultural Association of Cyprus (Համազգային Հայ Կրթական եւ Մշակութային Միութիւն, “Oshagan” chapter, 1999).

AYMA has its widely-known football team (1945), as of 2002 playing in the second category of the amateur league, a football academy (2011), a bowling team (2011) and a ping-pong academy (2012). AYF has the “Koyamard” (Գոյամարտ) youth group and the “Artsakh” (Արցախ) teenage group (both in 1977). Hamazkayin has the well-known “Sipan” dancing group (Սիփան:

 

Sony VAIO VPCS12E7E Battery2000), the “Timag” theatre company (Դիմակ: 2000) and the “Ardoudig” junior choir (Արտուտիկ: 2011); Sipan’s annual dance performance has become very popular during the last years. The AGBU has the strong futsal team AGBU-Ararat (1999), currently leading the first league (in which it has been playing since 2002),Sony VAIO VPCS11B7E Battery

 

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Sony VAIO VPCS12D7E Battery as well as an U–17 team (2010) and an U–21 team (2011). The Nor Serount Cultural Association has got the Homenmen futsal team (2006), as of 2011 playing in the third league.

In Nicosia, there is also the Sourp Asdvadzadzin church choir (Սուրբ Աստւոածածին եկեղեցւոյ երգչախումբ: 1921), under the auspices of the Armenian Prelature of Cyprus, and the “Nanor” junior dancing group (Նանոր: 2008), under the auspices of the Office of the Armenian MP.

Finally, the following foundations operate within the Armenian-Cypriot community: Sony VAIO VPCS11C5E Battery

Kalaydjian Foundation (Գալայճեան Հիմնարկոըթիւն, Larnaca: 1984).

“Hayastan” All-Armenian Fund (“Հայաստան” Համահայկական Հիմնադրամ, Nicosia: 1995).

Pharos Arts Foundation (Ίδρυμα Τεχνών Φάρος, Nicosia: 1998). Sony VAIO VPCS11D7E Battery

 

Sony VAIO VPCS12B7E BatteryArev Benevolent Foundation (Արեւ Բարեսիրական Հիմնարկութիւն, Nicosia: 2008).

The Kalaydjian Foundation manages the Kalaydjian Rest Home for the Elderly (Nicosia: 1988), which also houses Greek-Cypriot elderly. The Kalaydjian Rest Home for the Elderly was built on land leased by the government in Strovolos, Nicosia and it is one of the few purposely-built nursing homes in Cyprus. Its foundation stone was laid on 1 August 1987 by brothers Aram and Bedros Kalaydjian in memory of their parents,

 

Sony VAIO VPCS12A7R Battery Roupen and Marie Kalaydjian, and its inauguration took place on 6 March 1988 by Minister of Interior Christodoulos Veniamin. On 15 December 1995, Catholicos Aram I laid the foundation stone for the Holy Saviour of All chapel; Catholicos Aram I consecrated the chapel on 16 February 1997.

Sony VAIO VPCS12A7E BatteryIn 2005 the Rest Home underwent a major renovation and expansion with a second floor. The official inauguration of the new floor took place on 28 June 2006 by President Tassos Papadopoulos. The new floor is called “Alice and Arousiag Raphaelian” wing, after the sisters Arousiag and Alice Rafaelian, who bequeathed their house to the Kalaydjian Foundation.

 

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In the past, Armenian-Cypriot groups were active in the following areas:

Music: The Melkonian Educational Institute was famous for its choir and band, both founded by the famous musician and composer Vahan Bedelian. Their recitals were often attended by the High Commissioner/Governor or the President;

Sony VAIO VPCS11M9R/B Battery in later years, Sebouh Abcarian became its conductor. The Melikian-Ouzounian National School also had a band founded and conducted by Vahan Bedelian (1926–1941); in 1927, the exile “King of Arabia”, Shariff of Mecca Hussein bin Ali, purchased new musical instruments for it. In the mid–1940s,

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AYMA had the “Gomidas” church choir, founded and conducted by Sdepan Darakdjian, later archpriest Vazken Sandrouni. AYMA, AGBU and the Friends of Armenia Association (Paregamats) also had their amateur dance, choir and/or band ensembles. Sony VAIO VPCS11E7E Battery

 

Scouting: The Melkonian Educational Institute had the historical 7th Cyprus Scout Group (1932–2006), established by Headmaster Krikor Giragossian, Chief Scouts Major Onnig Cowan and Hagop Palamoudian and professors Levon Apkarian, Kersam Aharonian, Parounag Tovmassian and Vahan Bedelian.

 

Sony VAIO VPCS11J7E BatteryAYMA had the 77th Cyprus Scout Group (1959–1974 and 1986–1990), established by AYMA’s Chairman Anania Mahdessian and Chief Scouts Hagop Palamoudian and Artin Anmahouni. The Nicosia Armenian School had the 4th Cyprus Scout Group (1937–1963, 1966–1982 and 1999–2000),

Sony VAIO VPCS11G7E Batterywhile the Larnaca Armenian School had the 11th Cyprus Scout Group (1938–1959 και 1999–2001). Previously, there were other scout groups [e.g. Homenetmen scouts, (Larnaca: 1920–1922 and Nicosia: 1925–1930), the Larnaca Armenian School scouts (1927–1930) and the 12th Cyprus Scout Group (Nicosia: 1936–1947), Sony VAIO VPCS11F7E Battery       

founded by Chief Scout Hagop Palamoudian. As most scout groups were mixed, there were only two guide groups: 8th Cyprus Guide Group (Melikian-Ouzounian: 1949–1963) and 9th Cyprus Guide Group (Melkonian: 1950–2005). Three distinguished Armenian-Cypriot scouts and guides are worth special mention: Hagop Palamoudian, Sony VAIO VPCS13S9E/B Battery

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the first General Commissioner of the Cyprus Scouts Association) (1960–1962); Takouhy Devledian, amongst the founders of the Girl Guides Association of Cyprus, served as its General Commissioner (1987–1990); Artin Anmahouni, currently the oldest active scout in Cyprus is as of 1965 Honorary Commissioner of Armenian Scouts in Cyprus. Sony VAIO VPCS13V9E/B Battery

Football: The Gaydzak (Կայծակ=Lightning) team (Nicosia: 1930–1931) became Cyprus’ first cup holder in 1931. AYMA’s football team (established in 1945) is well-known amongst Cypriots, as it played in the first category (1947–1956 and 1960–1962); among its famous players were the late Armenian Archbishop of Greece, Sahag Ayvazian,

Sony VAIO VPCS11X9E Battery and the former Speaker of the House of Representatives, Marios Garoyian. Other Armenian-Cypriot football teams were the ones of the Melkonian (1926–2005), of Homenetmen (1927–1928), Ararat (Արարատ) (1938–1940), Gaydzak (1943–1944 and 1960–1962, affiliated with the Armenian Club in Nicosia) and Nor Gaydzak (Նոր Կայծակ=New Gaydzak) (1944–1948, Sony VAIO VPCS11V9E Battery

affiliated with the Friends of Armenia Association); after Nor Gaydzak stopped, some of its players found themselves in the first team of Omonia, such as far-famed Sarkis Bedigian (known by his nickname “Kilis”). Sony VAIO VPCS11H7E Battery

Other sports: The Melkonian used to have volleyball and basketball teams (the latter won the first basketball championship in Cyprus, 1949–1950). The Friends of Armenia Association had a volleyball team. AYMA at times had ping-pong, darts, hockey and basketball teams; AYMA’s hockey team was established in 1945 and was for three consecutive years champion (1951–1954),

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while AYMA's basketball team won the first basketball championship in Cyprus (1949–1950). The AGBU used to have women’s basketball and ping-pong teams. Sony VAIO PCG-3B1M Battery

Photography: Even though Armenians did not introduce photography in Cyprus, they improved the craft significantly and were the first ones to massively use retouching to produce coloured photos at a time where photographic lenses could record images only in black and white. There was a disproportionately large number of Armenian amateur and professional photographers active in Nicosia, Limassol,

Sony VAIO PCG-7144M Battery Larnaca and Famagusta. The most significant of these were Artin Anmahouni (Nicosia), Vahan Avedissian (Nicosia), Ardashes Bastadjian (Limassol), Diran Der Avedissian (Nicosia), Georges Der Parthogh (Nicosia), Hovhannes Gulian (Famagusta), Souren Keshishian (Larnaca), Hagop Kozalian (Famagusta), Haigaz Mangoian (Nicosia), Mateos Papazian (Nicosia), Minas Tilbian (Larnaca),

Sony VAIO PCG-71312M Battery Edward Voskeritchian (Limassol) and Giragos Zartarian (Nicosia). Their photographs are an idelible witness to the beauty of yesterday's Cyprus and constitute a window to times long gone. Today, only the descendants of the Mangoian and Voskeritchian families continue the photographic trade, in Nicosia and Limassol, respectively. Sony VAIO PCG-3C1T Battery

Printing As with photography, there was also an increased number of Armenian printers, in Nicosia and Larnaca. Historically, the first Armenian printer in Cyprus was Vahan Kurkjian (Pagouran). Pagouran set up his printing press in Nicosia as part of the National Educational Orphanage (1897-1904) and printed, Sony VAIO PCG-3D1M Battery

amongst others, the famous “Կիպրոս Կղզի” (Island of Cyprus: 1903); the book is the first out of many books dealing with the history of the Armenian-Cypriot community. Later on came Mardiros Mosditchian (Larnaca), Manuel Kassouni (Larnaca), Messia Ohanian (Larnaca), Maxoud Maxoudian (Nicosia), Setrak Guebenlian (Nicosia), Sony VAIO PCG-3G2M Battery

Haig Mosditchian (Larnaca) and Garabed Papazian (Larnaca), while during the 1940s-1950s there was a small printing press at the Melkonian Educational Institute. Some of the aforementioned printed their own newspapers, such as Arax (by Mardiros Mosditchian), Lousarpi (by Manuel Kassouni), Ovasis (by Maxoud Maxoudian),

Sony VAIO PCG-7153M Battery Nor Arax (by Haig Mosditchian), Henaran (by Setrak Guebenlian) and Deghegadou (by Garabed Papazian). It should be mentioned that Armenians were the first ones to introduce zincography in Cyprus.

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[edit]Legal status & Representation

The Armenian Representatives, 1960–2012

With the Independence of Cyprus, on 16 August 1960, under Article 2 § 3 of the Constitution, the Armenians, the Latins and the Maronites were recognised as “religious groups”. In the referendum held on 13 November 1960,

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all three religious groups opted to belong to the co-religious Greek-Cypriot community (as it was expected), something which consequently defined their political options in the game of inter-communal controversy and somewhat affected their relations with the Turkish-Cypriots, who in turn viewed them as an extension of the Greek-Cypriot political choices.Sony VAIO PCG-5R1M Battery

This is why the religious groups were treated similarly or even worse during the inter-communal troubles (1963–1964) and the brutal and unlawful Turkish invasion (1974). Sony VAIO PCG-7141M Battery

Article 110 § 3 recognises the administrative autonomy of the religious groups’ Churches, as it was established with the Hatt-ı Hümayun in 1856. According to Article 111, the three Churches retain their powers regarding matters of personal status. Law 95/1989 transferred the jurisdiction of the ecclesiastical courts to the family courts,

Sony VAIO PCG-7162M Battery the configuration of which was defined by Law 87(I)/1994; of the three religious groups, only the Armenians participate in their workings.

In accordance with the provisions of Article 109 of the Constitution, Armenian-Cypriots were given political representation: as a result of their choice to belong to the Greek-Cypriot community,

Sony VAIO PCG-7154M Batteryan Armenian and a Latin participated in the Nicosia members of the Greek Communal Chamber, while a Maronite participated in the Kyrenia members (Colonial Law 36/1959, Colonial Law 6/1960 and Greek Communal Chamber Law 8/1960). The two Communal Chambers, which acted as a Lower Parliament, had jurisdiction over all religious, educational, cultural and other affairs of communal nature (Article 87). Sony VAIO PCG-7143M Battery

With the secession of the Turkish-Cypriots from the common state in 1963 and the self-dissolution of the Greek Communal Chamber in 1965, Sony VAIO PCG-7151M Battery

it was decided to transfer the executive powers of the Greek Communal Chamber to the newly-formed Ministry of Education and its legislative powers to the House of Representatives (Law 12/1965).

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According to the Decision of the Council of Ministers 4.907/29–07–1965, it was decided that the three Representatives would provisionally continue to represent their communities in the House on issues pertaining to the jurisdiction of their Chamber and that the House was to request their opinion before legislating on pertinent matters (Law 12/1965). Sony VAIO PCG-3C1M Battery

Sony VAIO PCG-8152M BatteryIn order to approximate the tenure of the other MPs, the term of the three Representatives was annually extended (Law 45/1965, Law 49/1966, Law 50/1967, Law 87/1968 and Law 58/1969). The status of the three Representatives’ status in the House of Representatives was confirmed with Law 58/1970 and furthermore specified with Law 38/1976, Law 41/1981 and Law 66(I)/2011. As of 1991, Sony VAIO PCG-3F1M Battery

the elections for the three Representatives take place simultaneously and in parallel with the general parliamentary elections and the Representatives’ term is exactly the same with that of the proper MPs (Law 70/1986).

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The Representatives act as liaisons between their communities and the state and they are par excellence competent to bring before the state all issues relating to their group. Their participation has a 5–year duration and a consultative character, as although they can express their views on matters relating to their group,

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they do not have the right to vote. Especially in the case of the Armenians, the Representative delivers a speech about the Armenian Genocide during the plenary session of the House convened on or near the 24th of April each year.

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So far, there have been six (6) Armenian Representatives: Berge Tilbian from Nicosia (1960–1970), Dr. Antranik L. Ashdjian from Nicosia (1970–1982), Aram Kalaydjian from Larnaca (1982–1995), Bedros Kalaydjian from Larnaca (1995–2005), Dr. Vahakn Atamyan from Nicosia (2005–2006) and Vartkes Mahdessian from Nicosia (2006–today ). Sony VAIO PCG-3H1M Battery

The Representatives enjoy the same privileges as the other MPs (non-liability, immunity, remuneration, tax exemptions etc.), they attend the plenary sessions of the House, they participate in the Parliamentary Committee for Education and the Consultative Committee for Private Education of the Ministry of Education and Culture, while as of 1999 they appoint the Elder MP of their group.

Sony VAIO PCG-7186M Battery Although they can express their views on matters relating to their group, they do not have the right to vote. Additionally, the Armenian and the Maronite Representatives consult with the Minister of Education and Culture, in relation to the latter’s suggestion to the Council of Ministers regarding the appointment of the Armenian Schools’ Committee and the Maronite Schools’ Committee (Law 103(I)/1999).Sony VAIO PCG-3J1M Battery

As of 1998, the elected Representative is ex officio member of the Diocesan Council (Թեմական Ժողով) of the Armenian Ethnarchy (Ազգային Իշխանութիւն).

[edit]Elections

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“Concentrate your votes on the worthy candidate of the United Armenian-Cypriot Front, Berge Tilbian”. 1960 pamphlet

The first historical elections for the Armenian member of the Greek Communal Chamber took place on 5 August 1960 between Vahram Levonian and Berge Tilbian, who was elected after receiving 60,49% (1364 votes).

Sony VAIO PCG-9Z1M Battery Between 1965–1970 the term of office for the Armenian, the Maronite and the Latin Representatives was extended by special laws, until Law 58/1970 was enacted, properly including them in the House of Representatives. The second elections were held on 19 July 1970 between Berge Tilbian and Dr.

Sony VAIO PCG-5S1M Battery  Antranik L. Ashdjian, who was elected after receiving 56,30% (590 votes); Dr. Antranik L. Ashdjian was re-elected on 3 October 1976, with Aram Kalaydjian as his opponent, after receiving 50,96% (612 votes).

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The next elections were held on 14 March 1982 between Dr. Antranik L. Ashdjian and Aram Kalaydjian, who secured 58.36% (771 votes); Aram Kalaydjian was re-elected on 13 July 1986, with Anna Ashdjian as his opponent, after securing 65,08% (792 votes), and again on 19 May 1991,

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again winning over Anna Ashdjian and receiving 67,00% (875 votes). Because of Aram Kalaydjian’s death on 10 September 1995, a by-election took place on 22 October 1995, between Kevork Mahdessian and Bedros Kalaydjian, who won with 60,34% (849 votes). Bedros Kalaydjian was re-elected on 26 May 1996, securing 73,91% (997 votes) against Anna Ashdjian and again on 27 May 2001, receiving 57,13% (857 votes) against Dr. Garabed Khatcho-Kazandjian. Sony VAIO PCG-8141M Battery

Because of Bedros Kalaydjian’s death on 1 September 2005, a by-election was held on 9 October 2005, with Dr. Vahakn Atamyan receiving 52,03% (769 votes) against Dr. Antranik Ashdjian (43,91%) and Parsegh Zartarian (4,12%). The next elections took place on 21 May 2006, with Vartkes Mahdessian receiving 52,60% (899 votes) against Dr. Vahakn Atamyan. The most recent elections were held on 22 May 2011, with Vartkes Mahdessian securing 67,67% (1.105 votes) against Dr. Antranik Ashdjian.

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Although not elected, the Armenians in Nicosia also have a mukhtar, appointed by the Ministry of Interior. The first mukhtar was Melik Melikian (1927–1949), succeeded by Kasbar Delyfer (1949–1956) and Vahe Kouyoumdjian (1956–2009). As of 1 January 2011, the current Armenian mukhtar is Mgo Kouyoumdjian. Sony VAIO PCG-8161M Battery

[edit]Religion

Like most communities of the Armenian Diaspora, the Armenian-Cypriot community is predominantly Armenian Apostolic (about 95%). Some 5% belong either to the Armenian Evangelical Church, the Armenian Catholic Church, the Latin Church, the Greek Orthodox Church, the Anglican Church, the Plymouth Brethren Church,

Sony VAIO PCG-7191L Battery the Seventh-day Adventist Church or they are Jehovah’s Witnesses; of this 5%, the most significant group has historically been the Armenian Evangelical Church, which in the 1940s and 1950s comprised about 10% of the Armenian-Cypriot community.

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[edit]Armenian Prelature of Cyprus

‘The building of the Armenian Prelature of Cyprus in Strovolos, Nicosia

The Armenian Prelature of Cyprus (Առաջնորդարան Հայոց Կիպրոսի) was established in 973 by Catholicos Khatchig I and ever since it has maintained a continuous presence on the island. Historically, the Prelature has been under the jurisdiction of the Catholicosate of the Great House of Cilicia,

Sony VAIO PCG-71312M Battery while today it is the oldest theme that falls under its jurisdiction. In the past, for various reasons, it was at times under the Armenian Patriarchate of Jerusalem (1775–1799, 1812–1837, 1848–1861, 1865–1877, 1888–1897, 1898–1908), the Armenian Patriarchate of Constantinople (1799–1812,

Sony VAIO PCG-7153M Battery1861–1864, 1877–1888, 1897–1898, 1908–1921), even the Catholicosate of Etchmiadzin (1864–1865). The current Prelate, a Catholicosal Vicar General, is as of 1997 Archbishop Varoujan Hergelian. The parish priest in Nicosia is Fr. Momik Habeshian (since 2000), while the parish priest in Larnaca and Limassol is Fr. Mashdots Ashkarian (since 1992).

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For centuries, the Prelature building was located within the Armenian compound on Victoria street in walled Nicosia; when that area was taken over by Turkish-Cypriot extremists in 1963–1964, the Prelature was temporarily housed on Aram Ouzounian street (1964–1968) and, later on, on Kyriakos Matsis street in Ayios Dhometios (1968–1984). Thanks to the efforts of Bishop Zareh Aznavorian and with financial aid from the Evangelical Church of Westphalia, the new Prelature building was erected in 1983,

Sony VAIO PCG-7181M Battery next to the Sourp Asdvadzadzin church and the Nareg school in Nicosia; it was officially inaugurated on 4 March 1984, during the pastoral visit of Catholicos Karekin II. By initiative of Archbishop Varoujan Hergelian, in 1998 the basement of the building was renovated and the “Vahram Utidjian” Hall was formed; previously a store room, it became a reality from the proceeds of the auction in 1994 of the art collection that Vahram Utidjian had donated to the Prelature in 1954.

Sony VAIO PCG-7162M BatteryIt was inaugurated on 3 February 1999 by Catholicos Aram I; numerous charity, communal and cultural events take place there. The Prelature’s consistory houses a collection of ecclesiastical relics, some of which were previously in the old Sourp Asdvadzadzin church or the Magaravank.

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The Armenian Ethnarchy of Cyprus with Catholicos Aram I (2008)

The current Charter of the Prelature, first drafted in 1945 and ratified in 1950, consists of 102 articles and, in its present form, applies as of 3 September 2010. The administration is exercised by the Armenian Ethnarchy (Ազգային Իշխանութիւն) through the Diocesan Council (Թեմական Ժողով, consisting of the Prelate, two pastors and twelve elected lay persons) and the Administrative Council (Վարչական Ժողով,

Sony VAIO PCG-7151M Battery consisting of the Prelate and seven appointed lay persons), currently chaired by Sebouh Tavitian (as of 2007) and John Guevherian (as of 2011), respectively. As of 1998, the elected Representative is ex officio a member of the Diocesan Council. Sony VAIO PCG-3C1T Battery

There are also the local parish committees (թաղական հոգաբարձութիւններ, one in Nicosia, one in Larnaca and one in Limassol), the committee for Christian instruction (Քրիստոնէական դաստիարակութեան յանձնախումբ) and the Ladies’ committee (Տիկնանց յանձնախումբ). Under the committee for Christian instruction are the Sunday schools (Կիրակնօրեայ վարժարաններ) and the youth committee (երիտասարդական յանձնախումբ). 
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According to the Decision of the Council of Ministers 66.589/19–12–2007, the Armenian Prelature of Cyprus receives an annual grant of €59.800 by the Republic of Cyprus; the Republic also pays the salaries of the Prelature’s clergy and covers their medical expenses (Decision of the Council of Ministers 48.166/22–07–1998). The same arrangements apply for the Maronite Archbishopric of Cyprus and the Latin Vicariate of Cyprus (the latter, however, receives an annual grant of €51.260).

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[edit]List of Prelates

Below is the list of Prelates of the Armenian Prelature of Cyprus, according to available information. Unfortunately, there are some gaps:

Year Prelate     Year Prelate     Year Prelate     Year Prelate     Year Prelate

The old Nicosia Evangelical (Reformed Presbyterian) church (1950s)

[edit]Armenian Evangelical Church

The first Armenian Evangelicals in Cyprus came after the arrival of the British in July 1878. As they were not committed, and very few, they quickly became associated with the Mother Church (Armenian Apostolic Church), Sony VAIO PCG-3D1M Battery

such as Apisoghom Utidjian, the official state documents translator and the son of Stepan Utidjian, one the original founders of the Armenian Evangelical Church. With the influx of more Protestants, Armenian Evangelicals became affiliated with the Reformed Presbyerian Church as early as 1887. Although the main centres were Nicosia and Larnaca, gatherings were occasionally held in Limassol, Famagusta and Amiandos.

Sony VAIO PCG-7141M Battery In Larnaca, gatherings were held at the Reformed Presbyterian Mission church (built in 1892 and re-built in 1901–1902). In Nicosia, gatherings were initially held at the Reformed Presbyterian Mission church (built in 1906–1907), until Armenian Evangelicals built their own church in 1945–1946; a kitchen was added in 1959. Sony VAIO PCG-3G2M Battery

Armenian Evangelicals were granted provisional autonomy from the Reformed Presbyterian Mission in 1954, which was formalised in 1962. In Larnaca, as Armenian Evangelicals dwindled after the inter-communal troubles of 1963–1964, Sony VAIO PCG-5R1M Battery

services were no longer held; in Nicosia, the Armenian Evangelical church was taken over by Turkish-Cypriot extremists during the 1963–1964 inter-communal troubles and so services were held at the American Academy chapel (built in 1955) until 1973.

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After nearly 30 years of inactivity, by initiative of Nevart Kassouni-Panayiotides and the late Lydia Gulesserian and with the help of Hrayr Jebejian, Executive Secretary of the Bible Society in the Gulf, Armenian Evangelicals were re-organised at the Greek Evangelical church in Larnaca in 2002. Since 2005, when Hrayr Jebejian moved to Cyprus, services are held every few months at the Greek Evangelical church in Nicosia. The following is a list of the Armenian Reverends and preachers in charge of the Armenian Evangelical community of Cyprus.

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Headmaster    Term         Jurisdiction       Headmaster    Term         Jurisdiction       Headmaster

[edit]Places of worship

Cyprus has five Armenian churches, two in the capital Nicosia (one under Turkish occupation since 1974) and from one in Limassol, Larnaca and Famagusta; the latter has been occupied by the Turks since 1974. There are also three Armenian chapels in the vicinity of Nicosia and one within the Magaravank complex, also under Turkish occupation since 1974. 
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Sourp Asdvadzadzin church in Strovolos, Nicosia

[edit]Nicosia

The building of the Armenian Prelature of Cyprus and the cathedral of Sourp Asdvadzadzin (Սուրբ Աստուածածին, Virgin Mary) are located in Strovolos, Nicosia. The Prelature building was built in 1983–1984 and was inaugurated on 4 March 1984 by Catholicos Karekin II of Cilicia. The Prelature’s consistory houses a collection of ecclesiastical relics,Sony VAIO PCG-3F1M Battery

Sony VAIO PCG-31111M Battery some of which were previously kept at the Magaravank or the old Sourp Asdvadzadzin church; the relics are kept at a display case, donated in 1986 by Garabed and Nshan Arakchindjian. The Prelature’s basement is the “Vahram Utidjian” Hall, which was inaugurated on 3 February 1999 by Catholicos Aram I.

Sony VAIO PCG-81112M Battery The hall, previously a store room, became a reality from the proceeds of the auction in 1994 of the art collection that Vahram Utidjian donated to the Prelature in 1954. It is one of the main venues for events of the Armenian-Cypriot community. Together with the Sourp Asdvadzadzin church and the Nareg Armenian School, the land was granted in trust to the community on 16 December 1966 by the government; Sony VAIO PCG-3H1M Battery

on 10 December 1979, Strovolos Improvement Board decided to rename the road in front of the land from “Cyclops street” to “Armenia street”, as a gesture of solidarity to the Armenian people. A freehold title deed on the land was given on 31 March 1983. Sony VAIO PCG-3J1M Battery

Sourp Asdvadzadzin church in Strovolos, Nicosia

Sourp Amenapergitch chapel in Strovolos, Nicosia

The Sourp Asdvadzadzin cathedral was built between 1976–1981,with financial help from the World Council of Churches, the Evangelical Church of Westphalia, the Republic of Cyprus, the Holy Archbishopric of Cyprus and the faithful.

Sony VAIO PCG-7186M Battery Located next to Nareg Elementary School, its foundation stone was laid on 25 September 1976 by Archbishop Makarios III and Bishop Nerses Pakhdigian. On 16 April 1978, the Co-adjutor Catholicos Karekin II blessed the 16 columns of the church, while the inauguration and consecration of the cathedral took place on 22 November 1981 by Catholicos Khoren I and his Co-adjutor Karekin II.

Sony VAIO PCG-7171M Battery It is the only church in Cyprus built in a traditional Armenian style, with a central octagonal dome and a smaller dome for the bell. The church was renovated externally in late 2005 in memory of the Tutundjian family, killed in the Helios air accident, while the belfry was also repaired that year in memory of the late archpriest, der Vazken Sandrouni.[7]

The church was renovated internally in mid–2008. Many of its icons are the work of Lebanese-Armenian painter Zohrab Keshishian.

Sony VAIO PCG-9Z1M BatteryIt is interesting that just below the holy altar, there is a khachkar donated by the Holy See of Etchmiadzin. On top of the church’s entrance there is a marble inscription in Armenian reading:

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“Կառուցաւ սուրբ եկեղեցիս յանուն Սրբուհւոյ Աստուածածնին ի հայրապետութեան Տ. Տ. Խորենայ Ա. Կաթողիկոսի եւ Աթոռակցի Նորին Տ. Տ. Գարեգին Բ. Կաթողիկոսի եւ յառաջնորդութեան Տ. Զարեհայ Եպիսկոպոսի Ազնագորեան սրտադիր ջանիւք ամենայն զաւակայ Թեմիս Հայոց Կիպրոսի, եւ առատապարգեւ օժանդակութեամբ Միացեալ Եկեղեցւոյն Վեսթֆալիոյ եւ ձեռնտուութեամբ բարեխնամ կառավարութեամբ Կիպրոսի ի թուին Հայոց ՌՆԼ. Եւ փրկչական 1981 թուին” (This holy temple by the name of the Holy Mother of God was constructed during the pontificate of Catholicos Mr Mr Khoren I and His Co-adjutor Catholicos Mr Mr Karekin II and during the prelacy of Bishop Mr Zareh Aznavorian with the whole-hearted efforts of all the children of the Armenian Diocese of Cyprus, Sony VAIO PCG-8141M Battery

and the generously donated support of the Westphalia United Church and the assistance of the attentive government of Cyprus in the year 1430 of the Armenians and the year of our Lord 1981)

On the side of the church there is a marble inscription in Greek reading: Sony VAIO PCG-8161M Battery

“Ο ιερός ούτος ναός της Παναγίας των Αρμενίων εθεμελιώθη υπό της Α. Μ. του Προέδρου της Κυπριακής Δημοκρατίας Αρχιεπισκόπου Μακαρίου Γ’ την 25ην Σεπτεμβρίου 1976”” (The foundation of this holy temple of the Mother of God of the Armenians was laid by H. B. the President of the Republic of Cyprus Archbishop Makarios III on 25 September 1976)

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The old Armenian Evangelical church in old Nicosia

In front of the church’s entrance is a white marble khachkar (cross-stone) dedicated to the eternal friendship of Armenians and Greeks in Cyprus; it was unveiled on 21 October 2001 by Presidential Commissioner Manolis Christophides. To the side of the church’s entrance is the bronze bust of Archbishop Zareh Aznavorian;

Sony VAIO PCG-5N2M Batteryit was unveiled on 1 May 2005 by Italian-Armenian donator Aleco Bezigian. Finally, in the coutryard of the church is the white marble Armenian Genocide Monument; it was unveiled on 24 April 1991 by Senior Archimandrite Yeghishe Madjikian. In 2000, two white marble ossuaries were built in front of it, as well as five small sandstone khachkar-like columns. Sony VAIO PCG-3C2M Battery

Sourp Boghos chapel in Nicosia

Sourp Haroutiun chapel in Ayios Dhometios

In the old Armenian cemetery, near the Ledra Palace hotel, there is the Sourp Boghos (Սուրբ Պօղոս, Saint Paul) chapel, built in 1892 by donation of Boghos Odadjian. Left unused since the 1963-1964 intercommunal troubles, Sony VAIO PCG-3C1M Battery

the chapel and the cemetery fell into disuse. It was restored between 2008–2009, together with the rest of the cemetery, by initiative of Representative Vartkes Mahdessian and the Armenian Ethnarchy of Cyprus. On top of the chapel’s entrance there is a marble inscription in Armenian reading:

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“Կառուցաւ ս. տաճարս ‘ի հիմանց յանուն Ս. Առաքելոցն Պօղոսի արդեամբ բարեպաշտ Օտաճեան Պօղոսի Կ. Պօլսեցւոյ. Յամի Ս՟ռն 1892” (This holy temple was constructed from its foundations by the name of the H. Apostle Paul by commission of the pious Constantinopolitan Odadjian Boghos in the Lord’s Year 1892) Sony VAIO PCG-3F1M Battery

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Behind it, from inside the chapel, there is another marble inscription in Armenian reading:

“Կառուցաւ մատուրս արդեամբ Օտաճեան Պօպոսի, մասնակցութեամբ արկեղ Եկեղեցւոյ Հայոց ազգի, Յ’ Առաջնորդութեամբ Տ. Խորենայ Վարդապէտի, Յ’ Ամի Տեառն 1892.ի:” (This chapel was constructed by commission of Odadjian Boghos, with the participation of the fund of the Church of the Armenian nation, during the prelacy of Archimandrite Mr Khoren, in the Lord’s Year 1892.)

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In the Armenian cemetery near Ayios Dhometios there is the Sourp Haroutiun (Սուրբ Յարութիւն, Holy Resurrection) chapel, built in 1938 by donation of Haroutiun Bohdjalian and consecrated in 1949 by Bishop Ghevont Chebeyan. Left unused since the 1974 Turkish invasion, it was renovated in 2010. On top of its entrance,

Sony VAIO PCG-81112M Battery there is a marble inscription in Armenian reading:

“Ս. Յարութիւն: Շինեցաւ Ս. Յարութիւն մատուռս արդեամբ Սիար Յարութիւն Պօհճալեանի ի յիշատակ իւր եւ իւր ննջեցելոց 1938:” (Holy Resurrection. This Holy resurrection chapel was built by commission of Mr Haroutiun Bohdjalian in memory of him and his deceased 1938.)

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Finally, the Sourp Amenapergitch (Սուրբ Ամենափրկիչ, Saviour of All) chapel, was built between 1995–1997, by donation of Aram and Bedros Kalaydjian. Located in Strovolos, Nicosia, within the premises of the Kalaydjian Rest Home for the Elderly, its foundation stone was laid on 15 December 1995 by the Catholicos of the Great House of Cilicia, Aram I, who inaugurated it on 16 February 1997.[6] On top of its entrance, there is a marble inscription in Armenian reading:

“Սուրբ Ամենափրկիչ մատուռ” (Holy Saviour of All chapel) Sony VAIO PCG-3H1M Battery

The old Sourp Asdvadzadzin church in old Nicosia

The old Sourp Asdvadzadzin (Սուրբ Աստուածածին, Virgin Mary) cathedral, today in the Turkish-occupied part of the walled city of Nicosia, also known as Notre Dame de Tyre or Tortosa, was originally a Benedictine Abbey built between 1308–1310, on the site of an older church which was destroyed by an earthquake in 1303,

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where Armenian-Catholic nuns served. Sometime before 1504 it passed into the hands of the Armenian Apostolic Church and it used to be the centre of the Armenian community of Cyprus until it was captured,

Sony VAIO PCG-9Z1M Batteryalong with the rest of the Armenian quarter, by Turkish-Cypriot extremists during the 1963–1964 Turkish-Cypriot mutiny and occupied by Turkey during the 1974 Turkish invasion. After the osmanian occupation of Cyprus in 1570, Sony VAIO PCG-3J1M Battery

it was temporarily used as a salt store, until it was returned to the Armenian community by a firman in May 1571; the Armenian ownership of the church was further confirmed by another firman in May 1614. During the period of the Armenian Genocide, many persecuted Armenian refugees sought shelter on its verandah.

Sony VAIO PCG-5S1M Battery It was located next to the old Prelature building, the Melikian-Ouzounian school, the Armenian Genocide monument and the Melikian family mansion.

After its illegal occupation by the Turkish army in 1974, it was used as a camp, until it suffered further damages by an earhquake in 1998. The site was abandoned and illegal Anatolian settlers inhabited the place until 2007. In 2005,

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the UNDP conducted a feasibility study for its potential restoration. Heavily desecrated, its restoration finally started in October 2009 by the UNDP-USAID, and it is expected to be completed in mid 2012.[13]

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There was also a small Armenian Evangelical church, located in the Turkish-occupied part of the walled city of Nicosia, built in 1945–1946 near the Arab Ahmed mosque and inaugurated on 23 July 1946 by pastor Yohanna Der Megerditchian; it was expanded in 1959, with the addition of a kitchen. Today it is illegally used as a handicrafts centre.[6]Sony VAIO PCG-8141M Battery

[edit]Larnaca

Sourp Stepanos church in Larnaca

The church of Sourp Stepanos (Սուրբ Ստեփանոս, Saint Stephen) was originally built as a chapel by the Armenian refugees who came to Larnaca after the Adana massacre in 1909. It was built as a replica of Adana’s main church and was dedicated to Adana’s patron Saint, Saint Stephen.

Sony VAIO PCG-3C2M Battery However, as most of the refugees returned, the chapel was left unfinished. After a fund-raising which started on 24 October 1912, the small chapel became a church, whose construction finished on 1 April 1913. Sony VAIO PCG-8161M Battery

Dedicated to the memory of the martyrs of the Adana massacre, it is the first monument in the entire Armenian Diaspora in memory of the Armenian massacres in the Ottoman Empire. On top of church’s façade there is a commemorative composition featuring the Armenian ethnarch Haig, the last King of the Armenian Kingdom of Cilicia, Levon V, Sony VAIO VGN-SR11M Battery

 

a scroll held by a hand – representing the Ten Commandments and the four symbols of the Four Evangelists; around King Levon V, there is a commemorative inscription in Armenian:

 

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The commemorative façade of Sourp Stepanos church in Larnaca

“Ի Յիշատակ Կիլիկիոյ Նահատակաց – 1 Ապր. 1909″ (In Memory of the Cilician Martyrs – 1 Apr. 1909)

while under the composition and above the entrance it says:

 

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“Հայկական Մատուռ” (Armenian Chapel)

The church was inaugurated on 20 May 1914 by Senior Archimandrite Serovpe Samvelian and was consecrated on 30 June 1918 by Archbishop Taniel Hagopian. Until the early 1940s, there was a small octagonal dome on top of the church. The church was renovated between 1956–1957 and again in 1998. To the left and the right of the entrance, there are two marble inscriptions in Armenian: to the left, the inscription reads: Sony VAIO VGN-SR11MR Battery

 

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“Կառուցաւ մատուռս Յամի Տեառն 1909″ (This chapel was constructed in the Lord’s Year 1909)

and to the right, the inscription reads:

“Նորոգեցաւ մատուռս յամի Տեառն 1998″ (This chapel was renovated in the Lord’s Year 1998)

Many of the church’s icons are the work of Lebanese-Armenian painter Fr. Hovsep Ashkarian.

[edit]Limassol

 

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Sourp Kevork church in Limassol

The church of Sourp Kevork (Սուրբ Գէորգ, Saint George) is built on land donated circa 1935 by Satenig Soultanian, in memory of her father-in-law, Kevork. As the small Armenian community of Limassol could not afford to build a church, a theatre company was formed under Ardashes Bastadjian, giving performances in Nicosia,

Sony VAIO VGN-SR41M/P BatteryLarnaca and Limassol. Together with a contribution by the Armenian Prelature of Cyprus and Stepan Kavafian, the church was built between 1939–1940, while its consecration took place on 11 April 1948 by Bishop Ghevont Chebeyian. The church was renovated between 1975–1976 and again in 2006, while in 1989 its bell was made electronic by donation of brothers Garabed and Nshan Arakchindjian. Sony VAIO VGN-SR19VN Battery

During the 1975-1976 renovation, the belltower was placed on top of the entrance, while during the 2006 renovation, an Armenian cross was added with the inscription in Armenian reading:

 

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“Սուրբ Գէորգ եկեղեցի” (Saint George’s church)

On the outside of the repository, where the belltower used to be, there is another inscription in Armenian. In front of the church is a dark brown tuff stone khachkar (cross-stone), donated by the Arakelyan family; it was unveiled by Archbishop Varoujan Hergelian on 28 September 2008. Next to the church is the Limassol Armenian school. Sony VAIO VGN-SR19XN Battery

[edit]Famagusta

The Ganchvor church in Famagusta

The church of Sourp Asdvadzadzin Ganchvor (Սուրբ Աստուածածին Կանչուոր, Virgin Mary the Caller) was probably built in 1346 by Armenian refugees who escaped the Mameluke attacks against Ayas of Cilicia. It is located in the Turkish-occupied walled city of Famagusta and it is believed it was a part of an important monastic,

Sony VAIO VGN-SR29VN Batterycultural and theological establishment, at which Saint Nerses of Lambron is said to have studied. Left for more than three and a half centuries unused, because of Ottoman restrictions, it was repaired in 1907 by the Department of Antiquities, which restored it between 1937–1944.

 

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On 7 March 1936, the church was leased to the Armenian Prelature of Cyprus for a period of 99 years. It was officially re-inaugurated on 14 January 1945 by Archimandrite Krikor Bahlavouni (also known as “Topal Vartabed”). On 8 March 1957, the church was partially burnt by Turkish-Cypriots, but continued to be used as an Armenian church until 1962;Sony VAIO VGN-SR21M/S Battery

since then, the Famagusta Armenian community used the church of Ayia Paraskevi, which the Holy Archbishopric of Cyprus granted. In January 1964, it was taken by extremist Turkish-Cypriots during the 1963–1964 Turkish-Cypriot mutiny and was occupied by Turkey in August 1974 during the 1974 Turkish invasion. Until 2005, Sony VAIO VGN-SR21RM/H Batteryit was located in a “military area”. It has been left at the mercy of nature and vandals and it is in need of repairments.[6]

[edit]Halevga

The Magaravank in Halevga

Of great importance is the Sourp Magar (Սուրբ Մակար, Saint Makarios) monastery (Մակարավանք, Magaravank), located within Plataniotissa forest near Turkish-occupied Halevga, on the Pentadhaktylos mountain range. Sony VGP-BPS13/B Battery

The monastery was originally established by Copts circa the year 1000 on a location in which Saint Macarius is said to have been an ascetic; in fact, until the early 20th century, the Armenian residents of the region believed they could hear the Saint galloping with his horse at night. The monastery passed into the hands of the Armenians sometime before 1425. Sony VGP-BPS13B/B Battery

During the Latin Era, its monks were known for their strict diet, while during the Ottoman Era it was known as the “Blue Monastery” (Armenian: Կապոյտ Վանք, Turkish: Կէօք Մանասթըր/Mavi Manastır, Greek: Κυανούν Μοναστήρι), from the colour of its doors and its windown blinds. For centuries, it had been a renowned place of pilgrimage for Armenians and non-Armenians alike,

 

Sony VGP-BPS21/S Batterya way station for pilgrims en route to the Holy Land, as well as a place of recuperation and rest for Armenian Catholicoi and clergymen (it was the favourite holiday resort for Catholicos Sahag II, who used to ride his horse around its vast lands). Amongst its guests was Hovsep Shishmanian (better known by his literary name “Dzerents”), who spent much of his time there; inspired by the visible outline of the distant Taurus Mountains, in 1875 he wrote the historical novel Toros Levoni,

 

Sony VGP-BPS21A/B Batteryset in the times of the Cilician Kingdom of Armenia. One of the most important visitors of the monastery had been Abbot Mekhitar of Sebaste, who spent some time there in 1695 on his way to Rome.

 

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A large number of exquisite and invaluable manuscripts were housed there, as was the miracle-working icon of Saint Makarios and some valuable ecclesiastical vessels; the manuscripts and the vessels were transferred to Nicosia in the early 20th century and are today kept at a display case located at the premises of the Armenian Prelature of Cyprus.Sony VGP-BPS13A/B Battery

The monastery used to be a resort for Armenian scouts, students and families, especially on weekends and during the summer holidays, while after the Hamidian massacres (1894–1896), many of the Armenian refugees who fled to Cyprus found refuge here. Between 1897–1914,

 

Sony VGP-BPS21A Batterya small Armenian school was set up for the children of the families living around the monastery. Until 1974, Magaravank was the centre of attraction for almost the entire Armenian-Cypriot community. Its vast lands (about 8.500 donums) reached up to the seashore and included about 30.000 olive and carob trees, whose exploitation used to be the Prelature’s main source of income before 1974. Sony VGP-BPS13/S Battery

Panoramic view of the Magaravank (1926)

A large-scale renovation took place between 1734–1735 by Archimandrite Haroutiun, while between 1811–1818 Symeon Agha of Crimea financed a complete reparation and built the present chapel of the monastery.

Sony VGP-BPS21 Battery The initial chapel was at the centre of the Magaravank compound, however it was destroyed by earthquakes and natural conditions; the present chapel was built next to the original chapel in 1814. Renovations and restorations took place also in 1866 (by commission of the Armenian Patriarch of Constantinople Boghos Taktalian), in 1926 (by commission of Dikran Ouzounian, Ashod Aslanian and Garo Balian),

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in 1929 (by commission of Boghos and Anna Magarian), between 1947–1949 (by initiative of Hovhannes Shakarian) and again in 1973 (by initiative of the Armenian Ethnarchy of Cyprus. The square, to the east of the monastery, was constructed in 1933 by commission of Catholicos Sahag II.

 

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The chapel of the monastery was a favourite place for Christenings. It was completely defaced and desecrated by the Turkish troops, who occupied the monastery in August 1974. Left at the mercy of nature and vandals, today it is in a pitiful state. Between 1998–1999, the occupying regime intended to turn it into a hotel;

Sony VGP-BPS13/Q Batteryafter co-ordinated reactions, this unholy plan was averted. By initiative of Representative Vartkes Mahdessian and the Armenian Ethnarchy, on 6 May 2007 the first visit-pilgrimage took place there after 33 years; this visit-pilgrimage was repeated on 10 May 2009, 9 May 2010 and 8 May 2011, with the participation of a large number of Armenian-Cypriots, some of whom came from abroad[13] Sony VGP-BPS13 Batterty

Armenians have always placed particular emphasis on education, which – in conjunction with the Church – is the foundation of their national and cultural heritage. The first Armenian school in Cyprus, established by Archimandrite Vartan Mamigonian, Sony Vaio VGN-SR49VN/H Battery

 

opened its doors in Nicosia in 1870. More Armenian schools followed in Nicosia, Larnaca, Limassol, Famagusta, Amiandos, Magaravank and elsewhere, some public others private. Of the private ones, the most significant ones were the Melkonian Educational Institute in Nicosia (1926–2005) and the “National Educational Orphanage” in Nicosia and Magaravank (1897–1904.

 

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The individual public Armenian schools in Cyprus were placed under common administration in 1961, with a Headmaster in Nicosia, a senior teacher in Larnaca and a senior teacher in Limassol; the Famagusta Armenian school had only one teacher. As of 1972, Armenian Elementary Schools in Cyprus were called “Nareg National Schools” (Նարեկ Ազգային Վարժարաններ), in memory of monk, poet,

 

Sony Vaio VGN-FW56SR Batterymystical philosopher and theologian Krikor Naregatsi (951–1003), whose sandstone statue was placed in 1991 in front of the Nicosia Nareg school, sculpted by the famous Armenian sculptor Levon Tokmadjian.

Sony Vaio VGN-FW56ZR Battery Also in 1991, they assumed their current name “Nareg Armenian Schools” (Նարեկ Հայկական Վարժարաններ). Today, there is one Nareg school in Nicosia, one in Larnaca and one in Limassol, all under the auspices of the Armenian Schools’ Committee (Կիպրահայ Վարժարաններու Հոգաբարձութիւն).

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The Committee was initially appointed by the Armenian Ethnarchy of Cyprus until 1921, when its members were appointed by the High Commissioner/Governor (Colonial Law XXIV/1920); currently, its members are appointed for a 5–year term by the Council of Ministers, after the suggestion of the Minister of Education and Culture, who consults with the elected Representative [Law 103(I)/1999].

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In Nicosia, the Nareg School also operates as a Gymnasium (Junior High School), as of September 2005. As of September 2009, the schools’ Headmistress is Vera Tahmazian, while as of November 2009 the 11–member Schools’ Committee is headed by Vartan Tashdjian. All three schools are adjacent to the local churches and have about 185 students in total. Sony Vaio VGN-FW56Z Battery

 

The education they provide is tri-lingual (Armenian, Greek, English) and their curriculum is equivalent to that provided by the Cypriot public schools, in addition to lessons of Armenian language, history and religion, as well as activities that cultivate Armenianism and Armenology. Their budget is covered fully by the Ministry of Education and Culture of the Republic of Cyprus.[14]

 

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Below is a list of the Headmasters for the National/Armenian Schools in Cyprus, from 1921 until today (there is no complete information before 1921):

Headmaster    Term         Jurisdiction

The renowned Melkonian Educational Institute (Մելգոնեան Կրթական Միութիւն) was built after the generous and benevolent donation of tobacco-trading brothers Krikor and Garabed Melkonian,

 

Sony Vaio VGN-SR57X Batterywho were not left apathetic by the horrific Armenian Genocide. Adana Prelate, Bishop Moushegh Seropian, had encouraged the Melkonian brothers [commonly referred to as parerarner (բարերարներ=benefactors)] to undertake such a project, in order to give shelter and education to about 500 Armenian orphans of the Armenian Genocide who had fled to Syria, Lebanon and Mesopotamia.

Sony Vaio VGN-SR57V Battery According to tradition, the location, at the time 3 km outside Nicosia, is said to have been chosen in 1923 by Garabed Melkonian himself, because no minaterts could be seen from there. Its foundation stone was laid on 15 February 1924 by High Commissioner Sir Malcolm Stevenson and it was inaugurated on 13 February 1926 by Archbishop Zaven der Yeghiayian. Sony Vaio VGN-SR57S Battery

The grove in front of the school was planted by the first orphans, in memory of their relatives who perished during the Armenian Genocide. The Melkonian evolved from an orphanage (1926–1940) to a renowned secondary school (1934–2005). Sony VPCF11C4E/B Battery

 

A unique and unparalleled achievement, it was a beacon of hope and culture for Armenianism and Armenophony across the world, boasting an international membership of Armenian students from over 30 countries. From 1930 until its unjust closure in 2005, 1.828 students graduates from here. Rightly, it was called an ambassador of Cyprus to all over the world. It had a boarding section, a rich library and well-equipped laboratories.Sony VPCF11C5E Battery

Garabed Melkonian assigned the administration of the school to the AGBU on 28 December 1925. Upon becoming a secondary school, the Melkonian Educational Institute offered various branches of education. Between 1935-1967 there was a pedagogigal/teachers’ section, Sony VPCF11D4E Battery

between 1936-1942 there was a technical school (according to the reports of the Director of the Department of Education, Sony VPCF11M1E/H Battery

the first true technical school of the island), between 1937–1964 and 1974-2005 there was a commercial section, between 1950-2005 there was a science section, between 1964-1973 there was a general education section, while between 1966-1975 there was a social sciences section.

 

Sony VPCY21S1E BatteryOther than English, French and Armenian (both Western Armenian and Classical Armenian), at times and depending on the countries of origin of the student population, the students were also taught Greek, Arabic, Persian, Bulgarian and Russian. Sony VPCF11S1E/B Battery

Also known as “an island within an island”, it had a great educational and cultural impact on the Armenian-Cypriot community. It had a theatre group, a dance group, a choir, a band, a football team, a basketball team, a boys’ volleyball team and a girls’ volleyball team, as well as the historical 7th Cyprus Scout Group (1932–2006) and the 9th Cyprus Guide Team (1950–2005).

 

Sony VPCF23QIE Battery The Melkonian Educational Institute published the famous Ayk magazine [Այգ (Dawn), 1937–1940, 1948–1956, 1959–1964, 1970–1982, 1993–2006], the oldest Armenian secondary school magazine, as well as the Tsolk newspaper [Ցոլք (Gleam), 1968–1991] and Hayatsk newspaper [Հայեագք (Glance), 1998–2000], which later on became the Hayatsk magazine (2000–2004).

 

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The Melkonian Educational Institute had been the largest and longest-living Western Armenian boarding school. The new boarding section was built between 1987–1989 to the east of the twin buildings; its foundation stone was laid on 24 May 1987 by President Spyros Kyprianou, while its inauguration took place on 21 October 1989 by Acting President Vassos Lyssarides.

 

Sony VPCF21Z1E/BI Battery The school was administered by the New York-based AGBU, according to the contract signed by the benefactor Garabed Melkonian on 28 December 1925. Unfortunately, it was closed down in 2005 because of AGBU’s greed masked behind the façade that the school was no longer operating efficiently. Sony VPCF115FG/B Battery

Although the litigation was won by AGBU’s legal team, there is a permanent ministerial decree (02/03/2007) that characterises 60% of its total area as being of “special architectural, historical and social character and natural beauty”.[15] Sony VPCF21Z1E Battery

Between the two historical buildings of the Melkonian Educational Institute, there is the white marble Mausoleum of the immortal benefactors, Krikor Melkonian and Garabed Melkonian; its foundation stone was laid on 24 April 1954 by Bishop Ghevont Chebeyan, who unveiled it on 15 January 1956.

 

Sony VPCF13M1E/H BatteryOn the buildings’ sides facing the Benefactors’ Mausoleum are the twin sandstone monuments for the Armenian Alphabet and Mother Armenia; they were unveiled by AGBU President Alec Manougian. Sony VPCF22J1E Battery

Between the old and the new buildings, there is a series of sandstone statues depicting important pillars of Armenian history and letters: (great Armenian marine painter Hovhannes Aivazovsky, first Armenian printer Hagop Meghabard, great Armenian musician, composer and conductor Gomidas Vartabed Soghomonian, Sony VPCF22L1E Battery

inventor of the Armenian alphabet Saint Mesrob Mashdots, Armenian national hero, freedom fighter and military commander General Antranik Ozanian, great Armenian poet and Melkonian teacher Vahan Tekeyan and great Armenian historian of the “Golden Century” Movses Khorenatsi), all placed between 1990–1991. Sony VPCF22M1E Battery

Finally, in front of the new boarding section there is the white marble bust of then AGBU President Alec Manougian, placed there in 1990; the sandstone statues and the marble bust are the work of Armenian sculptor Levon Tokmadjian, who chiselled them on site, at the request of Headmaster Vahe Gabouchian. Sony VPCF22S1E Battery

Originally, the Melkonian Educational Institute was administered only by the Headmaster. As of 1940, it was supervised by the Melkonian Educational Institute School Committee (Մելգոնեան Կրթական Հաստատութեան Հոգաբարձութիւն), appointed by the AGBU Central Board; usually, the school committee had 5 members. Below is a list of Headmasters and Headmistresses of the Institute: Sony VPCF22S8E Battery

Nicosia’s first Armenian school was established in 1870 by newly-arrived Archimandrite Vartan Mamigonian and was called National Armenian School (Հայ Ազգային Վարժարան). In 1886 it was repaired by priest Hovhannes Shahinian, who called it Vartanants Boys’ School (Վարդանանց Մանչերու Վարժարան), Sony VPCF23M1E Battery

while in 1902 Archimandrite Bedros Saradjian founded the Shoushanian Girls’ School (Շուշանեան Աղջկանց Վարժարան). In 1921, by the will and testament of wealthy local landowner Artin Bey Melikian, the Melikian National School (Մելիքեան Ազգային Վարժարան) was founded, thus replacing the previous two schools into a co-educational one. Sony VPCF23Q1E Battery

In 1938 the Ouzounian National School (Ուզունեան Ազգային Վարժարան) was built, after the donation of successful businessman Dickran Ouzounian; subsequently, the school operated under the name Melikian-Ouzounian National School (Մելիգեան-Ուզունեան Ազգային Վարժարան).

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Both of them were taken over by Turkish-Cypriot extremists during the 1963–1964 Turkish-Cypriot mutiny. From February–June 1964, the Armenian National School (Հայ Ազգային Վարժարան) was housed at the Mitsis’ School for Girls on Makarios Avenue,Sony VPCF23S1E Battery

 

Sony VPCF12Z1E/BI Battery while from September 1964–June 1972 it was housed in two pre-fabricated buildings on the grounds of the Melkonian, until it moved to its current premises, built between 1971–1972. The new building was inaugurated on 12 November 1972 by Archbishop Makarios III and Catholicos Khoren I. Currently, it has about 125 students.

 

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Just before the entrance of the school, there is a marble commemorative plaque in Greek reading:

“Το Δημοτικόν Σχολείον Ναρέκ εκτίσθη επί χώρου δωρηθέντος υπό της κυπριακής κυβερνήσεως και ενεκαινιάσθη υπό της Α. Μ. του Προέδρου της Κυπριακής Δημοκρατίας Αρχιεπισκόπου Μακαρίου Γ’ την 12ην Νοεμβρίου 1972 παρουσία του Καθόλικου Χορέν Α’ της Κιλικίας. Η ανέγερσις του σχολείου έγινε με την φροντίδα του Αντιπροσώπου της αρμενικής κοινότητος εις την Βουλήν Δρος Αντρανίκ Αστζιάν”Sony VPCF24M1E Battery

  (The Nareg Elementary School was built on ground donated by the government of Cyprus and was inaugurated by H. B. the President of the Republic of Cyprus Archbishop Makarios III on the 12th November 1972 in the presence of Catholicos Khoren I of Cilicia. The erection of the school was made under the care of the Representative of the Armenian community in the House Dr Antranik Ashdjian)

 

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In front of the school’s entrance is the sandstone statue of Saint Gregory of Nareg, the work of Armenian sculptor Levon Tokmadjian; it was unveiled by School Committee member Takouhi Ashdjian on 28 March 1991. Between 2008–2010, a new auditorium was built by the Technical Services of the Ministry of Education and Culture;

Sony VPCF13Z8E Battery the auditorium was inaugurated on 17 May 2011 by Minister of Education and Culture, Dr. Andreas Demetriou. On the side of the entrance, there is a marble commemorative plaque in Greek and Armenian reading: Sony VPCF11S1E Battery

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“Η αίθουσα αυτή εγκαινιάσθηκε από τον έντιμο Υπουργό Παιδείας και Πολιτισμού Δρ. Ανδρέα Δημητρίου την 17η Μαΐου 2011 επί θητείας του Εκπροσώπου της αρμενικής κοινότητας στη Βουλή των Αντιπροσώπων κ. Βαρτκές Μαχτεσιάν – Սրահի բացումը կատարուեցաւ ձեռամբ Կիպրոսի Կրթութեան եւ Մշակոյթի Նախարար Դոկտ. Անտրէաս Տիմիթրիույի Հայ համայնքի Պետական Ներկայացուցիչ Պրն. Վարդգէս Մահտեսեանի պաշտօնավարութեան շրջանին” (This hall was inaugurated by the honourable Minister of Education and Culture Dr. Andreas Demetriou on the 17th May 2011 during the term of the Representative of the Armenian community in the House of Representatives Mr Vartkes Mahdessian)

 

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[edit]Larnaca

Larnaca’s Armenian school (1923)

Nareg Armenian school in Larnaca

Larnaca’s Armenian school was originally established in 1909 by Miss Rebecca Gomidassian. Within the same year and after funds acquired by Adana Bishop, Moushegh Seropian, a proper building was built next to Saint Stephen’s church; in 1917 a second room was added to the Mousheghian National School (Մուշեղեան Ազգային Վարժարան),Sony VPCF11Z1E/BI Battery

 

Sony VPCF13M1E/B Battery by donation of Miss Hanemie Eramian. By donation of the Adana Educational Association, a larger school building was constructed in 1923 and called National Armenian School (Հայ Ազգային Վարժարան); a second floor was added in 1926, by donation of Garabed Melkonian.

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The school’s yard hosted a number of Lebanese-Armenian refugees during the Lebanese civil war (1975–1990). However, over time, it exhibited structural weaknesses. By initiative of Representative Aram Kalaydjian and with funding from the Republic of Cyprus, a new school was built between 1993–1995 behind the old school and was inaugurated on 18 May 1996 by President Glafcos Clerides. Currently, it has about 25 students. Sony VPCF12E1E/H Battery

 

[edit]Limassol

Limassol’s school was originally established in 1928 as Armenian National School (Հայ Ազգային Վարժարան), operating at a rented house. After 1940, when the Saint George church was build, lessons were held at the church’s repository. A proper school building was built initially in 1951, Sony VPCF12F4E/H Battery

with donations from the Armenian Prelature of Cyprus, and was expanded in 1954 with contributions from the local community. It was completely re-built between 2006–2007 was inaugurated on 5 November 2008 by President Demetris Christofias. Currently, it has about 35 students.[6]

 

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[edit]Famagusta

Famagusta’s Armenian school was originally established in late 1927 as “Armenian National School” (Հայ Ազգային Վարժարան) and retained this name until 1972, when it was called “Nareg National School” (Նարեկ Ազգային Վարժարան), just like the other three Armenian schools of the island. It operated in various rented houses until 1974, when the city was occupied by the Turks, as it never had its own building. Sony VPCF12M1E/H Battery

[edit]Others

Students of Pagouran’s Orphanage

Students of Pagouran’s Orphanage

In the past, an Armenian school also operated in Pano Amiandos (1928–1939 and 1942–1948), under the auspices of Tunnel Asbestos Co., with Garabed Dzaghigian as its teacher; Garabed Dzaghigian was the teacher of the short-lived Armenian schools in Mavrovouni (1939–1942) and Prodhromos (1938–1942);

Sony VPCF13E8E Battery the Mavrovouni Armenian School operated under the auspices of the Cyprus Mines Corporation. During the World War II evacuation (1941–1942), Armenian schools operated in the villages of Agros, Anaphotia, Lefkara, Ormidhia, Pedhoulas, Pervolia, Prodhromos and Skouriotissa. The Pedhoulas school was the largest one, with Haigazoun Hagopian as its teacher. Sony VPCF13E4E Battery

There was also a small Armenian school at the Armenian Monastery in Pentadhaktylos (1897–1914) and a small Armenian school at Attalou settlement (near Kharcha village, 1910–1922); during its last years, the latter had Archimandrite Krikor Bahlavouni as its teacher,

 

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also known as “Topal Vartabed”. In Nicosia, there was small Armenian kindergarten in (1900–1905), run by the Armenian Evangelical sisters Rachel and Hosanna Sarkissian.

The majority of the old Armenian schools were in Larnaca: chronologically, a small Armenian school for refugee children of the Hamidian massacres, under the auspices of Reformed Presbyerian missionary Susan Fluhart (1896–1899),

 

Sony VAIO VPCS11V9E Battery a small Armenian school under the auspices of the American Academy of Larnaca (1916–1918, with Hagop Davidian as its teacher, and again between 1923–1936 as a 4–class Elementary School, with various teachers), a small Armenian Catholic school in Larnaca (1921–1923), run by Abbot Jean Kouyoumdjian and a small Armenian kindergarten under the auspices of the Reformed Presbyerian Mission (1923–1929),

 

Sony VAIO VPCS11H7E Battery with Josephine Gulesserian as its teacher. There were also three short-lived Armenian schools in Larnaca in 1922–1923, as a result of the huge influx of refugees from the Armenian Genocide; these were run by Haroutiun Kalaydjian, Verkin Abadjian and the Protestant Satenig Derderian.

Of particular importance was the National Educational Orphanage (Ազգային Կրթարան-Որբանոց),

 

Sony VAIO VPCS13V9E/B Batterywhich was founded by Vahan Kurkjian (also known as Pagouran), in order to educate orphaned Armenian children from the Hamidian massacres. It operated in Nicosia and, during the summer months, the Sourp Magar monastery between 1897–1904. Its students later became successful and influential, some in Cyprus, others in the Armenian Diaspora.[16]

 

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[edit]Monuments

Despite its small size, the Armenian-Cypriot community has plenty of monuments to show:

[edit]Nicosia

Genocide monument in Strovolos, Nicosia

The present white marble Armenian Genocide Monument was constructed between 1990–1991 by architect and painter John Guevherian and it is located in the courtyard of the new Sourp Asdvadzadzin church in Strovolos, Nicosia; its black granite cross is the work of Armenian sculptor Levon Tokmadjian. It was unveiled on 24 April 1991. It features three arches, representing Armenia and the two Diasporas, the one within the USSR and the one outside it. The monument bears three inscriptions:

 

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Στη μνήμη 1.500.000 Αρμενίων σφαγιασθέντων από τους Τούρκους το 1915 (in Greek), Ի յիշատակ 1,500,000 ապրիլեան նահատակաց 1915 (in Armenian) and In memory of 1.500.000 Armenians massacred by the Turks in 1915 (in English)

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In 1996 some martyrs’ remains, brought by members of an Armenian Relief Society mission from the Der Zor desert in Syria, were interred within the monument, while more bone remains are kept in the two marble ossuaries, built in 2000 in front of the monument by the Eghoyian and Tembekidjian families. Around the monument and the ossuaries are five khachkar-like columns, built with the donation of Anahid der Movsessian in 2000.

 

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The old Genocide monument in Nicosia

In front of the Sourp Asdvadzadzin church, there is a white marble khachkar, the work of Lebanese-Armenian sculptor Boghos Taslakian (also known as Aghassi), which stands as a symbol of friendship between Armenians and Greeks of Cyprus. 
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The khachkar was unveiled on 21 October 2001 by Presidential Commissioner Manolis Christophides and it bears the following inscription:

Յուշակոթող Հայ-Յոյն ժողովուրդներու բարեկամութեան Կիպրոս 1700ամեակ 301–2001 (in Armenian) and Σύμβολο φιλίας των Αρμενίων και Ελλήνων της Κύπρου 1700ετηρίδα 301–2001 (in Greek) (A symbol of friendship of Armenians and Greeks of Cyprus 1700th anniversary 301-2001)

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Also in front of the Sourp Asdvadzadzin church, there is a bronze bust of Archbishop Zareh Aznavorian (1947–2004), the work of Lebanese-Armenian sculptor Mgrdich Mazmanian. The bust was unveiled on 1 May 2005 by the benefactor, Italian-Armenian Aleco Bezigian. Sony VAIO VPCS11C5E Battery

 

In front of the Nareg School there is the sandstone statue of monk, poet, mystical philosopher and theologian Saint Krikor Naregatsi (951–1003), the work of Armenian sculptor Levon Tokmadjian. It was unveiled on 28 March 1991 by School Committee member Takouhi Ashdjian.

Also in 1991, the sandstone bust of AGBU’s founder and first Chairman Boghos Noubar Pasha (1851–1930) was placed to the side of Nicosia AGBU’s entrance, also the work of Armenian sculptor Levon Tokmadjian.

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It is worth mentioning the fact that the road in front of the Armenian compound in Strovolos, Nicosia was renamed on 10 December 1979 from Cyclops street to Armenia street, after a decision by Strovolos Improvement Board, as a gesture of solidarity to the brotherly Armenian people.

 

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The decision was taken after Bishop Zareh Aznavorian and community members made this suggestion. Today, Armenia street is one of the busiest roads of the greater Nicosia area and it is the centre of the traditional march for the commemoration of the Armenian Genocide on 24 April every year.

 

Sony VAIO VPCS12A7R BatteryAlso worth mentioning is the fact that the road to the side of the Melkonian Educational Institute was renamed on 23 March 2001 from Ephesus street to Melkonian street, after a decision by Aglandjia Municipality. The decision was taken after a request by the Melkonian Educational Institute, on the occasion of the 75th anniversary of the school’s operation.

 

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On 28 April 2002, a white marble tomb-ossuary containing some martyrs’ remains, brought by an Armenian Youth Federation mission from the Der Zor desert in Syria in 2001, was unveiled by Archbishop Varoujan Hergelian in front of the AYMA premises in Strovolos, Nicosia. The monument bears an inscription in Armenian: Sony VAIO VPCS11D7E Battery

Թող աճիւններն այս անթաղ մեր պապերուն նահատակ դառնան մեզ խիղճ, սթափեցնող ռումբ, ուժանակ, մեզ օրօրող օտարութեան ախտերէն… (Let these ashes of our unburied forefathers turn our consciousness into a martyr, an awaking bomb, a dynamite, which lulls us from the maladies of the foreign lands…) Sony VAIO VPCS11E7E Battery

Next to the monument, there is an inscription in Greek reading:

(The bones of the Armenian martyrs of the 1915 Genocide which lay in this place may they remind humanity about the crime that was left without conviction, may they remind to the powerful of the Earth about the millions who were lost and are thirsty for justice, Sony VAIO VPCS11F7E Battery

may they remind the younger generations that the debt they inherit is heavy and may this monument be a requiem, an inextinguishable candle, which will keep eternal the memory of the 1.500.000 innocent victims of the Armenian Genocide)

 

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Commemorative plate at the old Armenian cemetery of Nicosia

There is also a commemorative aluminium plate, located on top of a cenotaph in the Ayp cemetery (near Ledra Palace), which was placed 2010 and contains the names of the 419 people buried there between 1877 and 1931. This plate, probably the only one of its kind in a cemetery in Cyprus, is shown below:

 

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The inscription on top of the cenotaph at the old Armenian cemetery in Nicosia

Finally, in the old Armenian complex on Victoria street (nowadays in the Turkish-occupied Nicosia sector) was located the first Armenian Genocide monument in Cyprus,

 

Sony VAIO VPCS11M1E/W Battery constructed in 1932 by architect Garo Balian and considered to be the second oldest of its kind in the world. It was inaugurated on 24 April 1932 by Archbishop Bedros Saradjian. It bore the inscription in Armenian: Sony VAIO VPCS11G7E Battery

Յիշատակարան մէլ միլիոն Հայ նահատակաց 24 Ապրիլ 1915ի կանգնեցաւ կոթողս 24 Ապրիլ 1932 ի Կիպրոս (Memorial of one million Armenian martyrs of 24 April 1915 this obelisk was erected on 24 April 1932 in Cyprus)  Sony VAIO VPCS11J7E Battery

Unfortunately, it became itself a victim of the Turks during the 1963–1964 Turkish-Cypriot mutiny. All that survives of it today is its base, as the obelisk was taken down by the Turkish soldiers and its base was defaced by them. Until 2011, it bore a stencilled quote of Mustafa Kemal Atatürk, which was removed during the restoration of the Armenian compound. Sony VAIO VPCF112FX/H Battery

[edit]Melkonian

The Melkonian Brothers’ Mausoleum

The white marble Benefactors’ Mausoleum, with the bronze busts of Garabed Melkonian (1849–1934) and Krikor Melkonian (1843–1920),

Sony VAIO VPCY216FX/G Battery is located between the twin buildings, the work of French-Armenian sculptor Leon Mouradoff and French-Armenian architect Mardiros Altounian. It replaced an older, wooden trellis monument. Its foundation stone was laid on 24 April 1954 by Bishop Ghevont Chebeyian, who also inaugurated the Mausoleum on 15 January 1956.

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Between 1979–1980, artist Sebouh Abcarian constructed the twin sandstone monuments of the Armenian Alphabet and a synthesis resembling Mayr Hayastan; they were initially placed at the crossroads to the hospital and were inaugurated on 8 May 1981 by AGBU’s President Alec Manougian. In 1987 they were placed in their current position,

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on the twin buildings’ sides that face the Benefactors’ Mausoleum. The Mother Armenia synthesis bears an inscription in Armenian, from Solomon’s Book of Proverbs 1:2, said to be the first sentence written in Armenian by Saint Mesrob Mashdots after he devised the Armenian alphabet:

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Ճանաչել զիմաստութիւն եւ զխրատ,իմանալ զբանս հանճարոյ (To know wisdom and instruction, to perceive the words of understanding)

Between 1990–1991, at the request of Melkonian’s Headmaster Vahe Gabouchian, Armenian sculptor Levon Tokmadjian sculpted a series of 7 sandstone statues depicting important pillars of Armenian history and letters [great Armenian marine painter Hovhannes Aivazovsky (1817–1900), first Armenian printer Hagop

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Meghabard (15th–16th century), great Armenian musician, composer and conductor Gomidas Vartabed Soghomonian (1869–1935), inventor of the Armenian alphabet Saint Mesrob Mashdots (362–440), Armenian national hero,

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freedom fighter and military commander General Antranik Ozanian (1865–1927), great Armenian poet and Melkonian teacher Vahan Tekeyan (1878–1948) and great Armenian historian of the “Golden Century” Movses Khorenatsi (410–490)]. The bust of Saint Mesrob Mashdots is placed on a small circular garden behind the Benefactors’ Mausoleum, while the other busts are placed further back, Sony VAIO VPCF13M0E Battery

closer to the new boarding section. Levon Tokmadjian also sculpted the marble bust of philanthropist and AGBU Chairman Alec Manougian (1901–1996), placed in front of the new boarding section. Sony VAIO VPCF12AFM Battery

[edit]Larnaca

The khachkar in Larnaca

The church of Sourp Stepanos (Saint Stephen) is considered itself to be the oldest monument of the Armenian massacres, built between 1909–1913 with a commemorative façade on its entrance. It was inaugurated on 20 May 1914 by Senior Archimandrite Serovpe Samvelian and was consecrated on 30 June 1918 by Archbishop Taniel Hagopian. Sony VAIO PCG-5G2M Battery

 

Sony VAIO PCG-8113M Battery The commemorative façade features the Armenian ethnarch Haig, the last King of the Armenian Kingdom of Cilicia, Levon V, a scroll held by a hand – representing the Ten Commandments and the four symbols of the Four Evangelists; around King Levon V, there is a commemorative inscription in Armenian:Sony VAIO PCG-5J1M Battery

Ի Յիշատակ Կիլիկիոյ Նահատակաց – 1 Ապր. 1909 (In Memory of the Cilician Martyrs – 1 Apr. 1909)

while under the façade and above the entrance it says:

Հայկական Մատուռ (Armenian Chapel)

In the courtyard of Sourp Stepanos (Saint Stephen) is the reddish brown tuff stone khachkar dedicated to the 100th anniversary of the Adana massacre and the myriads of Armenian martyrs. It was carved in Sisian province, Armenia by Grishia Avedissian and was donated by Mihran and Jacqueline Boyadjian. It was consecrated by Archbishop Varoujan Hergelian on 25 December 2011. It bears the Armenian inscription Sony VAIO PCG-5J4M Battery

 

Ատանայի կոտորածի 100ամեակ 1909–2009 յուշարձան բիւրաւոր նահատակացնազգիս Հայոց (Centennial of Adana massacre 1909–2009 monument of the myriads of Armenian martyrs)

The Genocide memorial in Larnaca

The Armenian Genocide Memorial is adjacent to the Larnaca marina, marking the spot where thousands of Armenian Genocide refugees first set foot in Cyprus. A joint project by the governments of Cyprus and Armenia, Sony VAIO PCG-5K1M Battery

it was designed by architect and town planner Angelos Demetriou with the help of the architect Michael Thrassou and sculpted by Greek artist Georgios Kalakallas. Its foundation stone was laid on 24 November 2006 by Armenian President Robert Kocharyan and it was unveiled on 28 May 2008 by Cypriot President Demetris Christofias. It features a bronze eagle-like monument, surrounded by rows of pomegranate and cypress trees.Sony VAIO PCG-5K2M Battery

The four granite plaques at the base of the sculpture describing the monument were made by the government of Armenia. They read:

Το μνημείο αυτό υποδεικνύει το σημείο όπου Αρμένιοι πρόσφυγες, διαφεύγοντας τις διώξεις της Γενοκτονίας του 1915, πρωτοπάτησαν στην Κύπρο. Το μνημείο αποτελεί έκφραση ευγνωμοσύνης στο λαό της Κύπρου για τη συμπαράσταση και βοήθειά του προς τους πρόσφυγες αυτούς και είναι αφιερωμένο στη μνήμη των αμέτρητων θυμάτων της Αρμενικής Γενοκτονίας (in Greek), Sony VAIO PCG-5J5M Battery

This monument marks the spot where Armenian refugees feeling persecution during the Genocide of 1915 first landed in Cyprus. It represents the gratitude of the Armenian nation towards the people of Cyprus for their assistance and generosity to those refugees and stands in memory of the countless victims of the Armenian Genocide (in English), Այս հուշարձանը կեր է խոյանում այն վայրում, ուր 1915 թվականի ցեղասպանության կոտորածներից մազապուրծ հազարավոր Հայեր առաջին անգամ ոտք դրեցին Կիպրոս։ Այն արտահայտում է Հայ ազգի երախտագիտությունը Կիպրոսի ժողովրդին՝ իր բարեսրտության եվ օգնության համար։ Այս հուշարձանը հավերժացնում է Մեծ Եղեռնի անթիվ նահատակների հիշատակը (in Armenian) and Bu anit 1915 soykırımının katliamlarindan zor kurtarilmis binlerce Ermeninin Kıbrıs’ta ilk defa ayak bastiklari yeri gösterir. O Kıbrıs halkina kendi yi kalplin ve yardimi için Ermeni halkinin minnet duygularini ifade eder ve burada Ermeni soykiriminin sayis kurbanlarinin anisina dikilir (in Turkish) Sony VAIO PCG-5L2M Battery

 

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The square in front of the Memorial was funded by the Kalaydjian Foundation and links the Armenian Genocide Monument with Larnaca’s main promenade.

The monument for Abbot Mekhitar at the Magaravank

[edit]Limassol

A dark brown tuff stone khachkar was placed outside the Sourp Kevork (Saint George) church in 2008, as a donation from the Arakelyan family. It was carved in Gyumri and was unveiled on 28 September 2008 by Archbishop Varoujan Hergelian. On its base, there is the inscription in English:

 

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From Arakelyans family

[edit]Magaravank

There are two monuments at Sourp Magar. The first one is a mortar obelisk dedicated to Abbot Mekhitar, his visit there in 1695 and the 200th anniversary of the formation of the Mekhitarist Order. It was originally erected in 1901, as a pile of stones, by the students of the National Educational Orphanage, ran by Vahan Kurkjian (Pagouran); Sony VAIO PCG-6S4M Battery

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the inaugural ceremony was performed on 8 September 1901. Thirty years after this, the monument was re-constructed by 4 former students of the Orphanage (Movses Soultanian, Simon Vanian, Armen Bedevian, Rapael Pilibbossian), with the help of architect Garo Balian, and was unveiled on 21 August 1931 by Catholicos Sahag Khabayan and Archbishop Bedros Saradjian.[16]

 

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There are two inscriptions in Armenian on the monument; the Armenian inscription on the eastern side of the monument is a poem by Vahan Kurkjian and it reads:

ՄԽԻԹԱՐԱՅ ԲԼՈՒՐ – Ողջո՜յն քեզ բլուր, բնութեան տաճար, յիշատակ թողումք կոթողդ կարկառ նորընծայ անունդ պահէ՛ դարէ դար, կեցցէ՛ լուսաշող մեծն Մխիթար։ Վ.Քիւրքճեան (MEKHITAR’S HILL – Hail to you hill, temple of nature, may this stone monument be a memorial that preserves your holy name from century to century, long live the radiant great Mehhitar. V. Kurkjian)

 

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The western side of the monument has the following inscription in Armenian:

8 Սեպտ.1901 – Ի յիշատակ երկհարիւրամեակի Մխիթար Աբբահօր. Աշակերտք Ազգ.Կրթ.-Որբանոցի Նիկոսիոյ. Վերականգնեցաւ նախկին 4 աշակերտաց կողմէ – Մ.Ս.,Ս.Վ.,Ա.Պ.,Ռ.,Փ. 1931 (8 Sept. 1901 – In memory of the two hundredth anniversary of Abbot Mekhitar. The students of the Nat. Educ. Orphanage of Nicosia. Restored by 4 former students M. S., S. V., A. B., R. Ph. 1931)

 

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The other monument is a stone column, located at the monastery’s square and dedicated to the visit of Catholicos Sahag II there and the opening of the square in 1933; it was unveiled by himself on 8 September 1933. The inscription on the column, in Armenian reads: Sony VAIO PCG-6W2M Battery

Բացաւ հրապարակս այս արդեամբ եւ ըղձիւք Մեծին Բ. Սահակայ Վեհին Կիլիկիոյ ի յիշատակ այցելութեան ի Վանս, 8 Սեպ. 1933 (This square was opened by commission and desire of the Great Catholicos of Cilicia Sahag II in memory of his visit to this Monastery, 8 Sep. 1933)

 

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[edit]No longer existing

The oldest known Armenian inscription in Cyprus

The oldest known Armenian tombstone in Cyprus

In the past, there were also other Armenian monuments in Cyprus: a) a marble plaque at the Acropolis Park in Strovolos, Nicosia (1982–1988), in memory of the 1.500.000 martyrs of the Armenian Genocide, b) a cement eagle in front of the boys’ building of the Melkonian Educational Institute (1981–1997),

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c) a cement monument in memory of the 40th anniversary of Melkonian’s 7th Scout Group (1972–1989) and d) a stone monument in memory of the 45th anniversary of the 7th Scout Group (1977–1987). As noted earlier, from 1901 until 1931 there was a stone monument dedicated to Abbot Mekhitar on top of the hill overlooking the Magaravank, Sony VAIO PCG-8Y2M Battery

while from 1935 until 1955 there was a wooden octagonal mausoleum in memory of the Melkonian brothers. Finally, the Melkonian’s water tower (in Armenian: ջրամբար, chrampar), although not a monument per se, was a landmark of the school from the time it was built until the mid–1980s, when it was pulled down due to structural and safety concerns.

 

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The inscription on the left is the oldest known Armenian inscription in Cyprus. Located in Turkish-occupied Nicosia, it marks the entrance of the old Sinanian house, owned by Yevnige Sinanian, who lived there with her sister Eojenie.

Sony VAIO PCG-8Z3M BatteryThey inherited it from their parents, Apraham and Sima Sinanian; Apraham (1844–1894) was from Yozgat, whereas Sima (1859–1929) was an Armenian-Cypriot of unknown surname; there is mention that some of her ancestors perhaps came from Caesarea at an uncertain period. What the dates mean is uncertain, but perhaps 1791 is the year that Sima’s family first came to Cyprus.[17]

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The tombstone on the right is the oldest known Armenian tombstone in Cyprus. Located in the Ayp cemetery, it is a poem dedicated to the young Sdepan Papazian (1867–1875), the only son (and second of three children) of Negdarine Eramian (1842–1909) and Ohannes Papazian (1832–1896); while Ohannes was born in Yerzinga, Sony VAIO PCG-8Z1M Battery

Negdarine was the daughter of Boghos Eramian, an Armenian-Cypriot landowner and once the Head Treasurer from Dheftera.

In both inscriptions, even though the letters used are Armenian, the language is Turkish; the use of the Armenian script to write Turkish was common amongst Ottoman Armenians, called հայատառ թրքերէն (hayadar trkeren, Turkish in Armenian letters). In fact, the first Turkish novel to be published in the Ottoman Empire was Akabi Hikâyesi (Akabi’s story), written in 1851 with the Armenian script by Vartan Pasha. Sony VAIO PCG-8Y3M Battery

[edit]Cemeteries

Armenian-Cypriots have their own cemeteries:

[edit]Nicosia

The old Armenian cemetery in Nicosia

There are three Armenian cemeteries in Nicosia. The Ayp cemetery (near Ledra Palace hotel) was established probably around 1810, if not earlier. The records of burials kept at the Armenian Prelature of Cyprus start from late 1877. Sony VAIO VGN-NS10E/S Battery

 

They Ayp cemetery was used as a burial ground until 1931, when the Pen cemetery was established. The overwhelming influx of refugees from the Armenian Genocide made this cemetery too small for the increased number of burials; this, coupled with health concerns over cemeteries near the Nicosia city centre, Sony VAIO VGN-NS10J/S Battery

were the reasons why it became no longer operation. Within the cemetery there is the Sourp Boghos (Saint Paul) chapel, built in 1892 by the will and testament of government translator Boghos Odadjian.

 

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Until 1963, from time to time memorial services were performed at the chapel in memory of the ones buried there. After the 1963–1964 inter-communal troubles and due to its proximity to the UN Buffer Zone, the cemetery was somehow neglected and no Liturgies were held there. After decades of neglect and the incidents that transpired in 2005, Sony VAIO VGN-NS10L/S Battery

 

Sony VAIO VGN-SR51MF/W Battery the cemetery and its chapel was restored between 2008–2009 thanks to the initiative and efforts of the Armenian Ethnarchy and Armenian MP Vartkes Mahdessian, who secured a substantial amount of money for its restoration from the Ministry of Interior. There is also a commemorative aluminium plate, which was placed 2010 and contains the names of the 419 people buried there.[18] Sony VAIO VGN-NS11E/S Battery

 

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Shelter at the Kim cemetery in Nicosia

The Pen cemetery was established in 1931 on the west of Ayios Dhometios, near the Nicosia Commonwealth War cemetery, and it was the only Armenian cemetery in use in Nicosia until 1998. In 1938 the Sourp Haroutiun chapel was built within the cemetery, by the donation of Haroutiun Bohdjalian; Sony VAIO VGN-NS11ER/S Battery

 

Sony VAIO VGN-SR41M/S Battery it was consecrated in 1949. In 1963 the remains of about 100 people buried in the Ayp cemetery were transferred there, because of the demolition of a small part of the Ayp cemetery. Since the Turkish invasion of 1974, the Pen cemetery is very near the Turkish-occupied areas; as it is located within the UN Buffer Zone, visits there are allowed only on Sunday noons. A special permit by the UNFICYP is required for burials there. There are 1615 people buried in this cemetery.

 

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In 1998, the Kim cemetery was established to the south of the road between Lakatamia and Ayii Trimithias. The cemetery has no chapel and administratively belongs in Kato Dheftera. There are 130 people buried in this cemetery. Sony VAIO VGN-NS11J/S Battery

The tombstone of the Armenian Legionnaires in Larnaca

[edit]Larnaca

The Armenian cemetery in Larnaca was established in 1897, as a temporary place of repose on land given by the Prelature of Citium. It was officially granted to the community in 1923 and was expanded southwards in the early 1930s. Sony VAIO VGN-NS11L/S Battery

 

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It is located next to the Latin cemetery. Amongst the tombs and graves of that cemetery is a common grave for 9 gamavorner (volunteers) of the Armenian Legion, which was formed and trained in Monarga, Cyprus, between December 1916 and May 1918. Their names are: Movses Aprahamian, Hagop Bozayian, Hovhannes Hovhannessian, Kaloust Hovhannessian, Parsegh Klendjian, Levon Saradjian, Sony VAIO VGN-NS11S/S Battery

Hovhannes Silahlian, Artin Soghomonian and Khatchig Tchoukourian. Their grave and tombstone were commissioned by the French consulate in Cyprus. There are 630 people buried in this cemetery.

 

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[edit]Limassol

The Armenian cemetery in Limassol was granted to the community in 1946, but it was not untl 1960 that it started its operation, when the Mayor of Limassol Costas Partasides constructed its wall.[19] It is located to the west of the Limassol-Platres road and it is the beginning of the Garyllis river linear park. Administratively, it belongs in Kato Polemidhia. There are 145 people buried in this cemetery.

 

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[edit]Famagusta

There was also a small Armenian cemetery in the Turkish-occupied city of Famagusta, in the Ayios Memnon area. It was established in 1967, but unfortunately it is inaccessible since 1974, as it is located in the fenced area of Varosha. Between 1951–1966, the community in Famagusta used a different place of repose, near Stavros cemetery, which was however given to the Greek community to expand its own cemetery area; that too is located in the fenced area of Varosha. There were 8 people buried in this cemetery.[6]Sony VAIO VGN-NS11SR/S Battery

[edit]The Armenian Legion

See also: French Armenian Legion

Liturgy held at the camp of the Armenian Legion

After negotiations in September 1916, between Boghos Noubar Pasha and French political and military authorities, the Eastern Legion (Légion d’Orient/Արեւելեան Լէգէոն) was officially established in Cairo in November 1916. Sony VAIO VGN-NS11Z/S Battery

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It was to be an auxiliary unit of the French Military, which would be composed of Armenian volunteers from the Middle East, Europe and North America, whose aim was to liberate Cilicia from the Ottoman Empire, for the purpose of creating an independent Armenian state in that region. Several Armenian organisations pledged contributions to form battalions of the Legion. After negotiations with the British, Sony VAIO VGN-NS12M/S Battery

it was decided that the training of the volunteers (կամաւորներ=gamavorner) would take place at Monarga, in the Carpass peninsula of Cyprus.

The camp was built in December 1916 by Armenian refugees and in January 1917 the arrival of the volunteers started, which continued throughout 1917 and 1918. The selection and training were rather strict. The camp consisted of the headquarters, the barracks, various auxiliary installations (including a basin) and a small church. Sony VAIO VGN-NS12M/W Battery

In total, there were 4.124 volunteers, who formed 3 battalions. The commander of the camp was Infantry Lieutenant Colonel Louis Romieu and the spiritual shepherd was Archbishop Taniel Hagopian, assisted by Archbishop Krikor Bahlavouni, later known as “Topal Vartabed” (Թոփալ Վարդապետ=Lame Archimandrite). Both clergymen came to Cyprus from the Armenian Patriarchate of Jerusalem, even though at the time the Armenian Prelature of Cyprus was under the Armenian Patriarchate of Constantinople.Sony VAIO VGN-NS12S/S Battery

Training was completed by May 1918 and then the Legion was deployed in Palestine, marking the famous Battle of Arara on 19 September 1918. In December 1918 the Legion settled in the Cilicia region, where it remained until it was dissolved in October 1921, with its headquarters located in Adana.[20] In February 1919 it was officially called Armenian Legion (Légion Arménienne/Հայկական Լէգէոն). Sony VAIO VGN-NS21M/P Battery

After the dissolution of the Legion, a small number of Legionnaires returned to Cyprus. It is worth mentioning the fact that in the Armenian cemetery of Larnaca there is a group grave of 9 volunteers of the Armenian Legion, commissioned by the French consulate in the late 1940s. Today, very little remains in what used to be the camp of the Legion, currently located in the Turkish-occupied area of Cyprus. Sony VAIO VGN-NS21M/W Battery

[edit]Nerkaght

One of nerkaght’s ships (1947)

The nerkaght (ներգաղթ=repatriation) was a Pan-Armenian migration movement of Diasporan Armenians to Soviet Armenia, in the framework of a co-ordinated attempt of the Armenian SSR and the Church of Armenia to strengthen their claims on historical Armenia’s territory, appealing to the patriotic sentiments of Armenians in the Diaspora; especially after World War II, Sony VAIO VGN-NS21S/S Battery

it was also a way to partially replace the large number of Armenians who perished during the War. Massive propaganda took place, in co-operation with the AGBU and the Ramgavar party, arousing a storm of enthusiasm in the Armenian communities of the Diaspora and creating high expectations for their settling in the “homeland”,

 

Sony VAIO VGN-SR21RM/H Battery what they perceived as their ultimate destination. Nerkaght’s waves took place between 1921–1924, 1926–1929, 1932–1933, 1936, 1946-1949 (the greatest wave) and 1962–1973, when 170.703 Armenians in total migrated to Soviet Armenia from Iraq, Iran, Lebanon, the United States, Syria, Greece, Bulgaria, Romania, Palestine, Egypt, France, Turkey, Cyprus, Great Britain and Jordan.[21] Sony VAIO VGN-NS21S/W Battery

With the exception of 4-5 families who emigrated to Soviet Armenia in 1947, 576 Armenian-Cypriots in total were repatriated to Soviet Armenia between 1962-1964 (amounting to about 15% of the community at the time). From Famagusta’s harbour 20 left on 19 September 1962 (with the “Felix Dzerzhinsky” steamship), Sony VAIO VGN-NS21Z/S Battery

373 on 3 October 1962 (with the “Gruzia” steamship), 168 on 19 October 1963 (with the “Litva” steamship) and 15 on 4 September 1964 (with the “Odessa” steamship). Most of them settled in Girovagan (Vanatsor) or Leninagan (Guymri). Disappointed by what they saw and lived, almost all of them wanted to return to Cyprus from the start, Sony VAIO VGN-NS31M/P Battery

as they were not accustomed to that kind of life. The return started in 1967 and continued until 2005, although most of them came during the late 1980s (after the Spitak earthquake) and the early 1990s (after the dissolution of the Soviet Union). In fact, the first wave of Armenians from Armenia who came to Cyprus after 1991 were mostly Armenian-Cypriots who had migrated to Soviet Armenia in the 1960s and their spouses/descendants.[9] Sony VAIO VGN-NS31M/S Battery

[edit]Media

Despite its small size, the Armenian-Cypriot community has a long list of newspapers and magazines to show.

[edit]Current situation

Currently, the Armenian-Cypriot community has the following printed, electronic and online media:

 

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Armenian-Cypriot press 1960–2011

The Armenian radio programme has been broadcasted since 1953 on CyBC’s second programme (CyBC2). For many years, it was the only Middle Eastern broadcast in Armenian, with audiences from around the Middle East. Initially broadcasted on Sundays only, today it airs every day, between 17:00–18:00.

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Artsakank (Արձագանգ, Echo) was established in March 1995 (Artsakank website). It is a monthly newspaper, published by the Azadamard Armenian Youth Centre, with Arto Tavitian as its Editor-in-Chief.

 

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Azad Tsayn (Ազատ Ձայն, Free Voice) was established in April 2003. It is a monthly newspaper, published by Kevork Zeitountsian, who as of this year is also its Editor-in-Chief; previously, that was Yeran Kouyoumdjian.

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Keghart (Գեղարդ, Lance), a bimonthly newsletter, was established in October 1997 and it is published by the Armenian Prelature in Cyprus thanks to the initiative of Archbishop Varoujan Hergelian.

 

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Lradou (Լրատու, Newsletter), a tri-monthly newsletter, was established in October 2006 and it is published by the Office of the Armenian Representative. Its contents are compiled by the Armenian MP’s assistant, Nayiri Mouradian (Lradou website).

Sony VAIO VGN-NS38M/W BatteryGibrahayer (Armenian-Cypriots), established in September 1999, is a weekly online newsletter circulating every Thursday (Gibrahayer website). The news site has most contents in English, but also carries some Armenian language articles. Its Editor-in-Chief and owner is Simon Aynedjian. In October 2010, the e-magazine won an International Media Award from the Ministry of Diaspora at the All-Armenian Media conference in Stepanakert, the capital of Nagorno-Karabakh.

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Azad Khosk (Ազատ Խօսք, Free Speech), established in April 2011, is a monthly online magazine in Armenian (Azad Khosk website). Its Editor-in-Chief is Yeran Kouyoumdjian.

[edit]Media of the past

The following is a comprehensive list of Armenian-Cypriot newspapers and magazines printed in the past:[2

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Armenian-Cypriot press 1922–1960

Printed in Nicosia were the newspapers Kharazan [Խարազան (Whip), 1900], Azad Gibrahay [Ազատ Կիպրահայ (Free Armenian-Cypriot), 1922–1923], Nshouil [Նշոյլ (Ray), 1936–1938], Henaran [Յենարան (Support), 1959–1962], Gibrahay Deghegadou [Կիպրահայ Տեղեկատու (Armenian-Cypriot Informant), 1978–1993], Haytoug [Հայդուկ (Guerilla), 1979–1982), Artsakank [Արձագանգ (Echo), 1981–1982] and Paros [Փարոս (Pharos), 1997–2003], as well as the magazines Ovasis [Ովասիս (Oasis), 1928–1930] and Artsakank [Արձագանգ (Echo), 1983–1987]. 0] Sony VAIO VGN-NS31M/W Battery

Printed in Larnaca were the newspapers Kraser [Գրասէր (Bibliophile), 1923–1925], Arax [Արաքս (Arax), 1924–1929] and Lousarpi [Լուսարփի (Sunlight), 1925–1929], as well as the magazines Artsakank [Արձագանգ (Echo), 1952–1959] and Deghegadou [Տեղեկատու (Informant), 1973–1995].

 

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The Nor Arax [Նոր Արաքս (New Arax)] newspaper was initially printed in Larnaca (1945–1946) and later on in Nicosia (1946–1948).

The Melkonian Educational Institute published the following media:

Ayk magazine [Այգ (Dawn), 1937–1940, 1948–1956, 1959–1964, 1970–1982, 1993–2006], the oldest Armenian secondary school magazine.

 

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Tsolk newspaper [Ցոլք (Gleam), 1968–1991].

Hayatsk newspaper [Հայեագք (Glance), 1998–2000], which later on became the Hayatsk magazine (2000–2004).

 

Criticism of Facebook and Twitter— social networking service

Criticism of Facebook and Twitter—  social networking service

 

Facebook’s growth as an Internet social networking site has met criticism on a range of issues, including online privacy, child safety, and the inability to terminate accounts without first manually deleting the content. In 2008, Sony VAIO VGN-SR11M Battery

many companies removed their advertising from the site because it was being displayed on the pages of controversial individuals and groups. The content of user pages, groups, and forums has been criticized for promoting controversial topics. There have been several issues with censorship, both on and off the site. Sony VAIO VGN-SR11MR Battery

 

The changes[clarification needed] made by Facebook have been criticized, in particular the new format launched in 2008 and the changes in Facebook’s Terms of Use, which removed the clause detailing automatic expiry of deleted content. Facebook has also been sued several times.[1]

 

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In August 2007, the code used to generate Facebook’s home and search page as visitors browse the site was accidentally made public, according to leading internet news sites.[2][3] A configuration problem on a Facebook server caused the PHP code to be displayed instead of the web page the code should have created, Sony VAIO VGN-SR19VN Battery

raising concerns about how secure private data on the site was. A visitor to the site copied, published and later removed the code from his web forum, claiming he had been served legal notice by Facebook.[4] Facebook’s response was quoted by the site that broke the story:[5]

 

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“     A small fraction of the code that displays Facebook web pages was exposed to a small number of users due to a single misconfigured web server that was fixed immediately. It was not a security breach and did not compromise user data in any way. Because the code that was released powers only Facebook user interface, Sony VAIO VGN-SR19XN Battery

it offers no useful insight into the inner workings of Facebook. The reprinting of this code violates several laws and we ask that people not distribute it further.       ”

 

In November, Facebook launched Beacon, a system (discontinued in September 2009[6]) where third-party websites could include a script by Facebook on their sites, and use it to send information about the actions of Facebook users on their site to Facebook, prompting serious privacy concerns. Sony VAIO VGN-SR21M/S Battery

Information such as purchases made and games played were published in the user’s news feed. An informative notice about this action appeared on the third party site and gave the user the opportunity to cancel it, and the user could also cancel it on Facebook. Originally if no action was taken, the information was automatically published. Sony VAIO VGN-SR21RM/H Battery

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On November 29 this was changed to require confirmation from the user before publishing each story gathered by Beacon.

On December 1, Facebook’s credibility in regard to the Beacon program was further tested when it was reported that the New York Times “essentially accuses” Mark Zuckerberg of lying to the paper and leaving Coca-Cola, which is reversing course on the program, Sony VAIO VGN-SR31M Battery

a similar impression.[7] A security engineer at CA, Inc. also claimed in a November 29, 2007 blog post that Facebook collected data from affiliate sites even when the consumer opted out and even when not logged into the Facebook site.[8] Sony VAIO VGN-SR41M/P Battery

On November 30, 2007, the CA security blog posted a Facebook clarification statement [9] addressing the use of data collected in the Beacon program:

“     When a Facebook user takes a Beacon-enabled action on a participating site, information is sent to Facebook in order for Facebook to operate Beacon technologically. If a Facebook user clicks ‘No, thanks’ on the partner site notification, Sony VAIO VGN-SR41M/S Battery

Facebook does not use the data and deletes it from its servers. Separately, before Facebook can determine whether the user is logged in, some data may be transferred from the participating site to Facebook. In those cases, Facebook does not associate the information with any individual user account, and deletes the data as well.          ” Sony VAIO VGN-SR41M/W Battery

 

The Beacon service ended in September 2009 along with the settlement of a class-action lawsuit resulting from the service.[6]

[edit]News Feed and Mini-Feed

On September 5, 2006, Facebook introduced two new features called “News Feed” and “Mini-Feed”. The first of the new features, News Feed, appears on every Facebook member’s home page, displaying recent Facebook activities of the member’s friends. The second feature, Mini-Feed, keeps a log of similar events on each member’s profile page.[10] Sony Vaio VGN-CS11S/P Battery

Members can manually delete items from their Mini-Feeds if they wish to do so, and through privacy settings can control what is actually published in their respective Mini-Feeds.

Some Facebook members still feel that the ability to opt out of the entire News Feed and Mini-Feed system is necessary, as evidenced by a statement from the Students Against Facebook News Feed group, which peaked at over 740,000 members in 2006.[11] Sony Vaio VGN-CS11S/W Battery

Reacting to users’ concerns, Facebook developed new privacy features to give users some control over information about them that was broadcast by the News Feed.[12] According to subsequent news articles, members have widely regarded the additional privacy options as an acceptable compromise.[13]

 

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In December 2009, Facebook removed the privacy controls for the News Feed and Mini Feed.[14] This change made it impossible for users to control what activities are published on their walls (and consequently the public news feed).[15] Since users can post anything they want, this allowed people to post things that could target certain groups of people or abuse other users through other means. Sony Vaio VGN-CS11Z/R Battery

 

In May 2010, Facebook added privacy controls and streamlined its privacy settings, giving users more ways to manage status updates and other information that is broadcast to the public News Feed.[16] Among the new privacy settings is the ability to control who sees each new status update a user posts: Everyone, Friends of Friends, Sony Vaio VGN-CS11Z/T Battery

or Friends Only. Users can now hide each status update from specific people as well.[17]

[edit]Cooperation with government search requests

Government authorities rely on Facebook to investigate crimes and obtain evidence to help establish a crime, provide location information, establish motives, prove and disprove alibis, and reveal communications.[18] Federal, state, Sony Vaio VGN-CS21S/P Battery

and local investigations have not been restricted to profiles that are publicly available or willingly provided to the government; Facebook has willingly provided information in response to government subpoenas or requests, except with regard to private, unopened inbox messages less than 181 days old, which require a warrant and a finding of probable cause under federal law.[19]

 

Sony Vaio VGN-AW31ZS/B BatteryAn article by Junichi Semitsu published in the Pace Law Review, reports that “even when the government lacks reasonable suspicion of criminal activity and the user opts for the strictest privacy controls, Facebook users still cannot expect federal law to stop their ‘private’ content and communications from being used against them. “[19] Facebook’s privacy policy states that “We may also share information when we have a good faith belief it is necessary to prevent fraud or other illegal activity, Sony Vaio VGN-CS21S/R Battery

to prevent imminent bodily harm, or to protect ourselves and you from people violating our Statement of Rights and Responsibilities. This may include sharing information with other companies, lawyers, courts or other government entities.”[19] Sony Vaio VGN-CS21Z/Q Battery

Since Congress has failed to meaningfully amend the Electronic Communications Privacy Act to protect most communications on social networking sites such as Facebook and since the Supreme Court has largely refused to recognize a Fourth Amendment privacy right to information shared with a third party, Sony Vaio VGN-CS31S/R Battery

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there is no federal statutory or constitutional right that prevents the government from issuing requests that amount to fishing expeditions and there is no Facebook privacy policy that forbids the company from handing over private user information that suggests any illegal activity.[19]

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In July 2011, aided by Facebook, Israeli authorities prevented several pro-Palestinian activists, who “announced on their Internet sites that they planned to come [t]here and cause disruptions, and told their friends”, from boarding Tel Aviv-bound flights in Europe by “contact[ing] other foreign ministries and simply giv[ing] them links”.[20] Sony Vaio VGN-AW21S/B Battery

 

[edit]Complaint from CIPPIC

The Canadian Internet Policy and Public Interest Clinic (CIPPIC), per Director Phillipa Lawson, filed a 35-page complaint with the Office of the Privacy Commissioner against Facebook on May 31, 2008, based on 22 breaches of the Canadian Personal Information Protection and Electronic Documents Act (PIPEDA). University of Ottawa law students Lisa Feinberg, Harley Finkelstein, and Jordan Eric Plener, Sony Vaio VGN-CS31S/W Battery

initiated the “minefield of privacy invasion” suit. Facebook’s Chris Kelly contradicted the claims, saying that: “We’ve reviewed the complaint and found it has serious factual errors — most notably its neglect of the fact that almost all Facebook data is willingly shared by users.”[21] Assistant Privacy Commissioner Elizabeth Denham released a report of her findings on July 16, Sony Vaio VGN-CS31S/T Battery

2009.[22] In it, she found that several of CIPPIC’s complaints were well-founded. Facebook agreed to comply with some, but not all, of her recommendations.[22] The Assistant Commissioner found that Facebook did not do enough to ensure users granted meaningful consent for the disclosure of personal information to third parties and did not place adequate safeguards to ensure unauthorized access by third party developers to personal information.[22] Sony Vaio VGN-CS31S/P Battery

 

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[edit]Data mining

There have been some concerns expressed regarding the use of Facebook as a means of surveillance and data mining. The Facebook privacy policy once stated, “We may use information about you that we collect from other sources, including but not limited to newspapers and Internet sources such as blogs, instant messaging services and other users of Facebook, to supplement your profile.”[23] Sony Vaio VGN-CS31S/V Battery

However, the policy was later updated and now states: “We may use information about you that we collect from other Facebook users to supplement your profile (such as when you are tagged in a photo or mentioned in a status update). In such cases we generally give you the ability to remove the content (such as allowing you to remove a photo tag of you) Sony Vaio VGN-CS31Z/Q Battery

  or limit its visibility on your profile.”[23] The terminology regarding the use of collecting information from other sources, such as newspapers, blogs, and instant messaging services, has been removed. Sony Vaio VGN-CS21S/W Battery

 

The possibility of data mining by private individuals unaffiliated with Facebook has been a concern, as evidenced by the fact that two Massachusetts Institute of Technology (MIT) students were able to download, using an automated script, over 70,000 Facebook profiles from four schools (MIT, NYU, the University of Oklahoma, Sony Vaio VGN-CS21S/T Battery

and Harvard University) as part of a research project on Facebook privacy published on December 14, 2005.[24] Since then, Facebook has bolstered security protection for users, responding: “We’ve built numerous defenses to combat phishing and malware, Sony Vaio VGN-NW21MF Battery

 

Sony Vaio VGN-CS11S/T Batteryincluding complex automated systems that work behind the scenes to detect and flag Facebook accounts that are likely to be compromised (based on anomalous activity like lots of messages sent in a short period of time, or messages with links that are known to be bad).”[25] Sony Vaio VGN-NW21EF Battery

 

A second clause that brought criticism from some users allowed Facebook the right to sell users’ data to private companies, stating “We may share your information with third parties, including responsible companies with which we have a relationship.” This concern was addressed by spokesman Chris Hughes, who said “Simply put, we have never provided our users’ information to third party companies, nor do we intend to.”[26] Facebook eventually removed this clause from its privacy policy.[27] Sony Vaio VGN-NW21JF Battery

 

Previously, third party applications had access to almost all user information. Facebook’s privacy policy previously stated: “Facebook does not screen or approve Platform Developers and cannot control how such Platform Developers use any personal information.”[28] However, that language has since been removed. Sony Vaio VGN-NW21ZF Battery

Regarding use of user data by third party applications, the ‘Pre-Approved Third-Party Websites and Applications’ section of the Facebook privacy policy now states:

“     In order to provide you with useful social experiences off of Facebook, we occasionally need to provide General Information about you to pre-approved third party websites and applications that use Platform at the time you visit them (if you are still logged in to Facebook). Sony Vaio VGN-NW31EF BatterySimilarly, when one of your friends visits a pre-approved website or application, it will receive General Information about you so you and your friend can be connected on that website as well (if you also have an account with that website). In these cases we require these websites and applications to go through an approval process, Sony Vaio VGN-NS38E/S Battery

 

and to enter into separate agreements designed to protect your privacy…You can disable instant personalization on all pre-approved websites and applications using your Applications and Websites privacy setting. You can also block a particular pre-approved website or application by clicking “No Thanks” in the blue bar when you visit that application or website. Sony Vaio VGN-NS38M/W Battery

In addition, if you log out of Facebook before visiting a pre-approved application or website, it will not be able to access your information.[23]       ”

 

In the United Kingdom, the Trades Union Congress (TUC) has encouraged employers to allow their staff to access Facebook and other social networking sites from work, provided they proceed with caution.[29]

 

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In September 2007, Facebook drew a fresh round of criticism after it began allowing non-members to search for users, with the intent of opening limited “public profiles” up to search engines such as Google in the following months.[30] Facebook’s privacy settings, however, allow users to block their profiles from search engines. Sony Vaio VGN-AW21M/H Battery

 

Concerns were also raised on the BBC’s Watchdog programme in October 2007 when Facebook was shown to be an easy way in which to collect an individual’s personal information in order to facilitate identity theft.[31] However, there is barely any personal information presented to non-friends – Sony Vaio VGN-AW21S/B Battery

if users leave the privacy controls on their default settings, the only personal information visible to a non-friend is the user’s name, gender, profile picture, networks, and user name.[32]

In addition, a New York Times article in February 2008 pointed out that Facebook does not actually provide a mechanism for users to close their accounts, and thus raised the concern that private user data would remain indefinitely on Facebook’s servers.[33Sony Vaio VGN-AW21Z/B Battery

] However, Facebook now gives users the options to deactivate or delete their accounts, according to the Facebook Privacy Policy. “When you deactivate an account, no user will be able to see it, but it will not be deleted. We save your profile information (connections, photos, etc.) in case you later decide to reactivate your account.” The policy further states: “When you delete an account, it is permanently deleted from Facebook.”[23] Sony Vaio VGN-AW31ZS/B Battery

 

A third party site, USocial, was involved in a controversy surrounding the sale of fans and friends. USocial received a cease-and-desist letter from Facebook and has stopped selling friends.[34]

 

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[edit]Inability to voluntarily terminate accounts

Facebook had allowed users to deactivate their accounts but not actually remove account content from its servers. A Facebook representative explained to a student from the University of British Columbia that users had to clear their own accounts by manually deleting all of the content including wall posts, friends, Sony Vaio VGN-AW41ZF/H Battery

and groups. A New York Times article noted the issue, and also raised a concern that emails and other private user data remain indefinitely on Facebook’s servers.[35] Facebook subsequently began allowing users to permanently delete their accounts in 2010. Facebook’s Privacy Policy now states: “When you delete an account, it is permanently deleted from Facebook.”[23]

 

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[edit]Memorials

A notable ancillary effect of social networking websites, particularly Facebook, is the ability for participants to mourn publicly for a deceased individual. On Facebook, students often leave messages of sadness, grief, or hope on the individual’s page, transforming it into a sort of public book of condolences. This particular phenomenon has been documented at a number of schools.

 

Sony Vaio VGN-AW11Z/B Battery] Previously, Facebook had stated that its official policy on the matter was to remove the profile of the deceased one month after he or she has died,[45] preventing the profile from being used for communal mourning, citing privacy concerns. Due to user response, Facebook amended its policy. Its new policy is to place deceased members’ profiles in a “memorialization state”.[46] Sony Vaio VGN-AW41XH/Q Battery

Facebook’s Privacy Policy regarding memorialization says, “If we are notified that a user is deceased, we may memorialize the user’s account. In such cases we restrict profile access to confirmed friends, and allow friends and family to write on the user’s Wall in remembrance. We may close an account if we receive a formal request from the user’s next of kin or other proper legal request to do so.”[23] Sony Vaio VGN-AW41MF/H Battery

 

Such memorial groups have also raised legal issues. Notably, on January 1, 2008, one such memorial group posted the identity of murdered Toronto teenager Stefanie Rengel, whose family had not yet given the Toronto Police Service their consent to release her name to the media, and the identities of her accused killers, Sony Vaio VGN-AW41JF/H Battery

in defiance of Canada’s Youth Criminal Justice Act which prohibits publishing the names of under-age criminals.[47] While police and Facebook staff attempted to comply with the privacy regulations by deleting such posts, they noted that it was difficult to effectively police the individual users who repeatedly republished the deleted information.[48] Sony Vaio VGN-AW31M/H Battery

 

[edit]Customization and security

Facebook is often compared to MySpace but one significant difference between the two sites is the level of customization. MySpace allows users to decorate their profiles using HTML and CSS while Facebook allows only plain text.

 

Sony Vaio VGN-AW11ZR/B Battery However, a number of users have tweaked their profiles by using “hacks.” On February 24, 2006, a pair of users exploited a cross-site scripting (XSS) hole on the profile page and created a fast-spreading worm, loading a custom CSS file on infected profiles that made them look like MySpace profiles.[49] Sony Vaio VGN-AW21S Battery

 

On April 19, 2006, a user was able to embed an iframe into his profile and load a custom off-site page featuring a streaming video and a flash game from Drawball. He has since been banned from Facebook.[50] Sony Vaio VGN-AW21M Battery

On March 26, 2006, a user was able to embed JavaScript in the “Hometown” field of his profile which imported his custom CSS.[51]

In each case, Facebook quickly patched the holes, typically within hours of their discovery. However, in July 2007, Adrienne Felt, an undergraduate student at the University of Virginia, discovered a cross-site scripting (XSS) hole in the Facebook Platform that could inject JavaScript into profiles.

 

Sony  VGP-BPS21A/b Battery She used the hole to import custom CSS and demonstrate how the platform could be used to violate privacy rules or create a worm.[52] This hole took Facebook two and a half weeks to fix.[53] Sony Vaio VGN-NS20EF/W Battery

 

[edit]Quit Facebook Day

Quit Facebook Day was an online event which took place on May 31, 2010 (coinciding with Memorial Day), in which Facebook users stated that they would quit the social network, due to privacy concerns.[54] It was estimated that 2% of Facebook users coming from the United States would delete their accounts.[55] However, only 33,000 users quit the site.[56] Sony  VGP-BPS13 Battery

 

[edit]Photo recognition and face tagging

Facebook enabled an automatic facial recognition feature in June 2011, called “Tag Suggestions”. The feature compares newly uploaded photographs to those of the uploader’s Facebook friends, in order to suggest photo tags. Facebook has defended the feature, saying users can disable it.[57]

Sony  VGP-BPS21/S BatteryFacebook introduced the feature in an opt-out basis.[58] European Union data-protection regulators said they would investigate the feature to see if it violated privacy rules.[57][59]

[edit]Investigation by the Irish Data Protection Commissioner 2011. Sony  VAIO VGP-BPS13A/B Battery

 

 

In August 2011 the Irish Data Protection Commissioner (DPC) started an investigation after receiving 16 complaints by europe-v-facebook.org which was founded by a group of Austrian students.[60] The DPC stated in first reactions that the Irish DPC is legally responsible for privacy on Facebook for all users within the European Union [61] and that he will “investigate the complaints using his full legal powers if necessary”.[62] Sony  VAIO VGP-BPS13B/B Battery

The complaints were filed in Ireland because all users who are not residents of the United States or Canada have a contract with “Facebook Ireland Ltd”, located in Dublin, Ireland. Under European law Facebook Ireland is the “data controller” for facebook.com, and therefore, facebook.com is governed by European data protection laws.[61Sony  VAIO VGP-BPS13/S Battery

] Facebook Ireland Ltd. was established by Facebook Inc. to avoid US taxes (see Double Irish arrangement).

The group europe-v-facebook.org made access requests at Facebook Ireland and received up to 1.200 pages of data per person in 57 data categories that Facebook was holding about them,[63] including data that was previously removed by the users.[64] Sony  VAIO VGP-BPS13A/S Battery

Despite the amount of information given, the group claimed that Facebook did not give them all of its data. Some of the information not included was “likes”, data about the new face recognition function, data about third party websites that use “social plugins” visited by users and information about uploaded videos. Sony  VAIO VGP-BPS13B/S Battery

 

The 16 complaints target different problems, from undeleted old “pokes” all the way to the question if sharing and new functions on Facebook should be opt-in or opt-out.[65] The most severe could be a complaint that claims that the privacy policy and the consent to the privacy policy is void under European laws. It is reported that the group is planning to file more complaints, including one against the “Like” button.[66] Sony  VAIO VGP-BPS13/Q Battery

 

In an Interview with the Irish Independent a spokesperson said, that the DPC will “go and audit Facebook, go into the premises and go through in great detail every aspect of security”. He continued by saying: “It’s a very significant, detailed and intense undertaking that will stretch over four or five days. Sony  VAIO VGP-BPS13A/Q Battery

Then we’ll publish a detailed report and Facebook will respond”.[67] This means that the investigation by the DPC might become one of the most severe investigations into Facebook’s privacy practice in the past years. Sony  VAIO VGP-BPS13B/Q Battery

 

[edit]Breach of privacy extends to non-members of Facebook

An article published by USA today claimed that Facebook has created a web log of pages visited both by its members and by others. Facebook relies on tracking cookies to keep track of pages visited by more than 800 million individuals. Sony  VGP-BPS21 Battery

 

According to the article, the United States congress and the world wide web consortium are attempting to set new guidelines to deal with privacy concerns. It is not clear whether the information collected in this manner is provided only to advertisers and no others. [68] Sony  VGP-BPS21A Battery

[edit]Divorce

Social networks, like Facebook, can have a detrimental effect on marriages with users becoming worried about their spouse’s contacts and relations with other people online, leading to marital breakdown and divorce.[69] In the UK, between 20 to 33 percent of divorce petitions cite Facebook as a cause Sony  VGP-BPS21B Battery

 

[edit]Psychological effects

 

[edit]Envy

Facebook has been criticized for making people envious and unhappy due to the constant exposure to positive yet unrepresentative highlights of their peers. Sites such as Facebook Detox state that this kind of envy has profound effects on other aspects of life and can lead to depression.

 

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[edit]Stress

Research performed by psychologists from Edinburgh Napier University indicated that Facebook adds stress to users’ lives. Causes of stress included fear of missing important social information, fear of offending contacts, discomfort or guilt from rejecting user requests or deleting unwanted contacts, the pressure to be entertaining, Sony Vaio VGN-NW21MF Battery

and having to use appropriate etiquette for different types of friends.[80] Many people who started using Facebook for positive purposes[vague] have found that the website has negatively impacted their actual lives.[81] Sony Vaio VGN-NW21EF Battery

 

[edit]Misleading campaigns

 

In May 2011 emails were sent to journalists and bloggers making critical allegations about Google’s privacy policies; however it was later discovered that the anti-Google campaign, conducted by PR giant Burson-Marsteller, was paid for by Facebook in what CNN referred to as “a new level skullduggery” and which Daily Beast called a “clumsy smear.” While taking responsibility for the campaign, Sony Vaio VGN-NW21JF Battery

Burson-Marsteller said it should not have agreed to keep its client’s (Facebook’s) identity a secret. “Whatever the rationale, this was not at all standard operating procedure and is against our policies, and the assignment on those terms should have been declined,” it said in a statement.[82] Sony Vaio VGN-NW21ZF Battery

 

[edit]Inappropriate content controversies

 

[edit]Identity theft

One can easily create an account and impersonate another person, often for malicious or mischievous reasons and to harass others.[83][84][85][86][87][88] This criticism is not unique to Facebook, since any site with user accounts has the potential for users to create false accounts but due to its popularity and wide use Facebook is cited as the main cause of this on internet.

 

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[edit]Defamation

On July 24, 2008, the High Court in London ordered a British cameraman to pay £22,000 (then about US$43,700) for breach of privacy and libel. He had posted a fake Facebook page purporting to be that of a former schoolfriend and business colleague, Mathew Firsht, with whom he had fallen out in 2000. Sony Vaio VGN-NW31JF Battery

The fake page claimed that Firsht was homosexual and untrustworthy. The case is believed to be the first successful invasion of privacy and defamation verdict against someone over an entry on a social networking site. Sony Vaio VGN-NW31ZF/S Battery

 

[edit]Anorexia and bulimia

Facebook has received criticism from users and from people outside the Facebook community about hosting pro-anorexia and pro-bulimia information.[95] British eating disorder charity B-EAT called on all social networking sites to curb “pro-ana” (anorexia) and “pro-mia” (bulimia) pages and groups, naming MySpace and Facebook specifically.[96] Sony Vaio VGN-NW31EF Battery

 

[edit]Advertiser concerns

On August 3, 2007, British companies including First Direct, Vodafone, Virgin Media, The Automobile Association, Halifax and the Prudential removed their advertisements from Facebook. A Virgin Media spokeswoman said “We want to advertise on social networks but we have to protect our brand”. Sony Vaio VGN-NW20EF/P Battery

The companies found that their services were being advertised on pages of the British National Party, a far-right political party in the UK. New Media Age magazine was first to alert the companies that their ads were coming up on BNP’s Facebook page.[97] Sony Vaio VGN-NW20EF/S Battery

 

[edit]Holocaust denial

In 2009, Facebook received criticism for including Holocaust denial groups.[98] Barry Schnitt, a spokesman for Facebook, said, “We want Facebook to be a place where ideas, even controversial ideas, can be discussed.” While Facebook’s terms of use include the warning that users may “be banned if they post ‘any content that we deem to be harmful, threatening, unlawful, defamatory, infringing, abusive, inflammatory, harassing, vulgar,

 

Sony Vaio VGN-NW26M Batteryobscene, fraudulent, invasive of privacy or publicity rights, hateful, or racially, ethnically or otherwise objectionable’”, Schnitt said, “We can’t guarantee that there isn’t any content that violates our policies.” Sony Vaio VGN-NW20EF/W Battery

 

[edit]Pro-mafia groups’ case

In Italy, the discovery of pro-mafia groups[99] caused an alert in the country[100][101][102] and brought the government, after a short debate,[103] to rapidly issue a law which will force ISPs to deny access to entire sites in case of refused removal of illegal contents; Sony Vaio VGN-NW11Z/T Battery

the removal can be requested by a prosecutor in any case in which there is a suspicion that criminal speech (a defence of or incitement to crime) is published on a website. The amendment was passed by the Italian Senate and now needs to be passed unchanged[104] by the Chamber of Deputies to become immediately effective. Sony Vaio VGN-NW11Z/S Battery

 

Facebook and other websites, Google included,[105] criticized the amendment emphasizing the eventual effects on the freedom of speech of those users who do not violate any law. Sony Vaio VGN-NW11S/T Battery

 

[edit]Trolling

On March 31, 2010, the Today Show ran a segment detailing the deaths of three separate adolescent girls and trolls’ subsequent reactions to their deaths. Shortly after the suicide of high school student Alexis Pilkington, anonymous posters began trolling for reactions across various message boards, referring to Pilkington as a “suicidal slut”, and posting graphic images on her Facebook memorial page. Sony Vaio VGN-NW11S/S Battery

The segment also included an exposé of a 2006 accident, in which an eighteen-year-old student out for a drive fatally crashed her father’s car into a highway pylon; trolls e-mailed her grieving family the leaked pictures of her mutilated corpse.[106] Sony Vaio VGN-NW31EF Battery

 

There have been cases where Facebook “trolls” were jailed for their communications on Facebook, particularly memorial pages. In Fall 2010, Colm Coss of Ardick, Britain, was sentenced to 26 weeks in jail under s127 of the Communications Act 2003 of Great Britain,[107] for “malicious communications” for leaving messages deemed obscene and hurtful on Facebook memorial pages.[108][109] Sony Vaio VGN-NW20ZF Battery

In April 2011, Bradley Paul Hampson was sentenced to three years in jail after pleading guilty to two counts of using a carriage service, the Internet, to cause offense, for posts on Facebook memorial pages, and one count each of distributing and possessing child pornography when he posted images on the memorial pages of the deceased with phalluses superimposed alongside phrases such as “Woot I’m dead”.Sony Vaio VGN-NW24S Battery

 

[edit]Technical

 

[edit]Disabling of user accounts

There have been complaints of user accounts easily being mistakenly disabled for violating Facebook’s Statement of Rights and Responsibilities. The disabling is often automated and can be easily triggered by a user filing a report on an account, regardless of whether or not the report is legitimate.[112][113] Sony  VAIO VGN-FW21E Battery

Once Facebook disables an account, whether it does so for unconfirmed reasons or a suspicion that something may be awry, it is impossible to reinstate the account, partly due to lack of in-person support and partly because any attempt to do so sends the account holder into a closed loop.[citation needed] Sony  VAIO VGN-FW21I Battery

 

Facebook’s Statement of Rights and Responsibilities is often misleading. For example, it states that joining a school network is not a requirement, even though users are often disabled for not joining a school network.[114] Facebook has disabled user accounts for having names deemed to be fake despite being real.[115] Once an account is disabled, it can no longer be logged into and all public traces of it disappear.[116] Sony  VAIO VGN-FW21L Battery

 

There have also been instances of user accounts being memorialized, even though the person listed on the profile was not deceased.[117][118]

[edit]Enabling of Harassment

 

Sony VAIO VGN-FW46M Battery

This section includes a list of references, related reading or external links, but its sources remain unclear because it lacks inline citations. Please improve this article by introducing more precise citations. (January 2012). Sony  VAIO VGN-FW21Z Battery

 

Facebook instituted a policy by which it is now self-policed by the community of Facebook users. Some users have complained that this policy allows Facebook to empower abusive users to harass them by allowing them to submit reports on even benign comments and photos as being “offensive” or “in violation of Facebook Rights Sony  VAIO VGN-FW21M Battery

  and Responsibilities” and that enough of these reports result in the user who is being harassed in this way getting their account blocked for a predetermined number of days or weeks, or even deactivated entirely.[119][120] Sony  VAIO VGN-FW31M Battery

In addition, Facebook does not ban the IPs of users who have proven to create multiple accounts for the purposes of trolling or stalking others, thereby enabling the harasser, even if they do have one of the offending accounts deactivated, to simply create another one and continue the harassment with no lasting consequences.[121] Sony VAIO VGN-FW11J Battery

port

Facebook lacks live support, making it difficult to resolve issues that require the services of an administrator or are not covered in the FAQs, such as the enabling of a disabled account.[122] The automated emailing system used when filling out a support form often refers users back to the help center or to pages that are outdated and cannot be accessed, leaving users at a dead end with no further support available.[123] Sony VAIO VGN-FW11Z Battery

 

[edit]Lack of customer sup

[edit]Downtime and outages

Facebook has had a number of outages and downtime large enough to draw some media attention. A 2007 outage resulted in a security hole that enabled some users to read other users’ personal mail.[124] In 2008, the site was inaccessible for about a day, from many locations in many countries.[125] In spite of these occurrences, Sony VAIO VGN-FW11ZRU Battery

a report issued by Pingdom found that Facebook had less downtime in 2008 than most social networking websites.[126] On September 16, 2009, Facebook started having major problems with loading when people signed in. On September 18, 2009, Facebook went down for the second time in 2009, Sony VAIO VGN-FW11ZU Battery

  the first time being when a group of hackers were deliberately trying to drown out a political speaker who had social networking problems from continuously speaking against the Iranian election results.[127] On August 10, 2011 Facebook was in-accessible.[citation needed] On March 5, 2012 again, the website was in-accessible for about half an hour. Sony VAIO VGN-FW21J Battery

 

In October 2009, an unspecified number of Facebook users were unable to access their accounts for over three weeks.[128][129][130][131][132] On September 23, 2010, nobody within the UK, US, and Latin America could log in to Facebook. Facebook quoted a DNS failure.[citation needed]

[edit]Upgrades 

 

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[edit]September 2008

In September 2008, Facebook permanently moved its users to what they termed the “New Facebook” or Facebook 3.0.[133] This version contained several different features and a complete layout redesign. Between July and September, users had been given the option to use the new Facebook in place of the original design,[134] or to return to the old design. Sony VAIO VGN-FW21ZR Battery

 

Facebook’s decision to migrate their users was met with some controversy in their community. Several groups started opposing the decision, some with over a million users.[135]

[edit]October 2009

In October 2009, Facebook redesigned the news feed so that the user could view all types of things that their friends were involved with. In a statement, they said, Sony VAIO VGN-FW3ZJ Battery

 

Sony VAIO VGN-FW41M/H Battery

Stores your applications generate can show up in both views. The best way for your stories to appear in the News Feed filter is to create stories that are highly engaging, as high quality, interesting stories are most likely to garner likes and comments by the user’s friends.[136]

 

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This redesign was explained as:

News Feed will focus on popular content, determined by an algorithm based on interest in that story, including the number of times an item is liked or commented on. Live Feed will display all recent stories from a large number of a user’s friends.[136] Sony VAIO VGN-FW41E/H Battery

 

The redesign was met immediately with criticism with users, many who did not like the amount of information that was coming at them. This was also compounded by the fact that people couldn’t select what they saw. Immediately, groups formed, one getting over 1,600,000 within the first two weeks of the update.[137] Sony VAIO VGN-FW41J/H Battery

 

[edit]November/December 2009

In November 2009, Facebook issued a proposed new privacy policy, and adopted it unaltered in December 2009. They combined this with a rollout of new privacy settings. This new policy declared certain information, including “lists of friends”, to be “publicly available”, with no privacy settings; it was previously possible to keep access to this information restricted. Sony VAIO VGN-FW41M/H Battery

Due to this change, the users who had set their “list of friends” as private were forced to make it public without even being informed, and the option to make it private again was removed.[138] This was protested by many people and privacy organizations such as the EFF.[139]

 

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The change was described by Gawker as Facebook’s Great Betrayal,[140] forcing user profile photos and friends lists to be visible in users’ public listing, even for users who had explicitly chosen to hide this information previously,[139] and making photos and personal information public unless users were proactive about limiting access.[141] Sony VAIO VGN-FW41ZJ/H Battery

For example, a user whose “Family and Relationships” information was set to be viewable by “Friends Only” would default to being viewable by “Everyone” (publicly viewable). That is, information such as the gender of partner you are interested in, relationship status, and family relations became viewable to those even without a Facebook account. Facebook was heavily criticized[142] Sony VAIO VGN-FW46M Battery

for both reducing its users’ privacy and pushing users to remove privacy protections. Groups criticizing the changes include the Electronic Frontier Foundation[139] and American Civil Liberties Union.[143] Mark Zuckerberg, CEO, had hundreds of personal photos and his events calendar exposed in the transition.[144] Sony VAIO VGN-FW4ZTJ/H Battery

Facebook has since re-included an option to hide friends lists from being viewable; however, this preference is no longer listed with other privacy settings, and the former ability to hide the friends list from selected people among one’s own friends is no longer possible.[145] Sony VAIO VGN-FW51 Battery

Journalist Dan Gillmor deleted his Facebook account over the changes, stating he “can’t entirely trust Facebook”[146] and Heidi Moore at Slate’s Big Money temporarily deactivated her account as a “conscientious objection”.[147] Other journalists have been similarly disappointed and outraged by the changes.[140] Sony VAIO VGN-FW51ZF/H Battery Defending the changes, founder Mark Zuckerberg said “we decided that these would be the social norms now and we just went for it”.[148] The Office of the Privacy Commissioner of Canada launched another investigation into Facebook’s privacy policies after complaints following the change.[149] Sony VAIO VGN-FW46M Battery

Sony VAIO VGN-FW4ZTJ/H Battery

 

[edit]Tracking cookies

Facebook has been criticised heavily for ‘tracking’ users, even when logged out of the site. Australian technologist Nik Cubrilovic discovered that when a user logs out of Facebook, the cookies from that login are still kept in the browser, allowing Facebook to track users on websites that include “social widgets” distributed by the social network. Facebook has denied the claims, saying they have ‘no interest’ in tracking users or their activity. Sony VAIO VGN-FW51 Battery

 

Sony VAIO VGN-FW54M BatteryThey also promised after the discovery of the cookies that they would remove them, saying they will no longer have them on the site. A group of users in the United States have sued Facebook for breaching privacy laws.[citation needed]

[edit]Censorship controversies

 

 

 

The warning box that appears when Internet users try to view censored or blocked content on Facebook

[edit]Search function

Facebook’s search function has been accused of preventing users from searching for certain terms. Michael Arrington of TechCrunch has written about Facebook’s possible censorship of “Ron Paul” as a search term. MoveOn.org’s Facebook group for organizing protests against privacy violations could for a time not be found by searching. Sony VAIO VGN-FW51ZF/H Battery

 

Sony VAIO VGN-FW56 BatteryThe very word privacy was also restricted.[150] Facebook claimed that the problem was a bug.

[edit]Breastfeeding photos

Facebook has been repeatedly criticized for removing photos uploaded by mothers of themselves breastfeeding their babies and also canceling their Facebook accounts.[151] Although photos that show an exposed breast violate Facebook’s decency code, even when the baby covered the nipple, Facebook took several days to respond to criticism and deactivate a paid advertisement for a dating service that used a photo of a topless model.[152] Sony VAIO VGN-FW51MF/H Battery

 

Sony VAIO VGN-FW54S Battery

The breastfeeding photos controversy continued following public protests and the growth in the online membership in the Facebook group titled “Hey, Facebook, breastfeeding is not obscene! (Official petition to Facebook).”[153] In December 2011, Facebook removed photos of mothers breastfeeding and after public criticism, restored the photos. The company said it removed the photos they believed violated the pornographic rules in the company’s terms and conditions.[154]

 

Sony VAIO VGN-FW54J BatteryDuring February, 2012, the company renewed its policy of removing photos of mothers breastfeeding. Founders of a Facebook group “Respect the Breast” reported that “women say they are tired of people lashing out at what is natural and what they believe is healthy for their children.”[155] Sony VAIO VGN-FW56M Battery

 

[edit]Censorship of editorial content

On February 4, 2010, a number of Facebook groups against the Democratic Alliance for the Betterment and Progress of Hong Kong (DAB) were removed without any reason given.[156] The DAB is one of the largest pro-Beijing political parties in Hong Kong. The affected groups have since been restored. Sony VAIO VGN-FW35F Battery

Sony VAIO VGN-NW24S Battery

 

On May 21, 2010, Facebook disabled the account of Sulphur Springs, Texas radio station KNOI after it posted editorial comments critical of Facebook’s privacy policies and shared links to articles about Leo Laporte’s decision to delete his own Facebook account.[157] Sony VAIO VGN-NW26M Battery

 

[edit]Accusation of politically biased granting of group upgrades

In May 2011, Facebook announced that in the coming months it will be “archiving” all groups in the old format, part of the consequence of which is losing all the existing members of a group, which would effectively destroy many groups, forcing them to re-acquire members from scratch. A few groups have been given an option to “upgrade” to the new groups format,

 

Sony VAIO VGN-FW54E Batterywhich keeps the members, but the criteria for determining whether a group is offered this “upgrade” are unknown. Some groups have had success in getting this upgrade by having activity in their group, while others have not. One article has claimed an empirical observation that disproportionately more “liberal” groups have been able to upgrade than “conservative” groups, leading to accusations of potential political bias, or of politically motivated censorship of conservative groups.[158] Sony VAIO VGN-FW56E Battery

 

[edit]Student-related issues

 

[edit]Student privacy concerns

Students who post illegal or otherwise inappropriate material have faced disciplinary action from their universities, including expulsion.[further explanation needed] [159] Others posting libelous content relating to faculty have also faced disciplinary action.[160] Sony VAIO VGN-FW56J Battery

 

[edit]Effect on higher education

On January 23, 2006, The Chronicle of Higher Education continued an ongoing national debate on social networks with an opinion piece written by Michael Bugeja, director of the Journalism School at Iowa State University, entitled “Facing the Facebook”.[161] Bugeja, author of the Oxford University Press text Interpersonal Divide (2005), Sony VAIO VGN-NW24EG Battery

 

Sony VAIO VGN-FW46Z Battery quoted representatives of the American Association of University Professors and colleagues in higher education to document the distraction of students using Facebook and other social networks during class and at other venues in the wireless campus. Bugeja followed up on January 26, 2007 in The Chronicle with an article titled “Distractions in the Wireless Classroom”,[162] Sony VAIO VGN-NW24JG Battery

quoting several educators across the country who were banning laptops in the classroom. Similarly, organisations such as the National Association for Campus Activities,[163] the Association for Education in Journalism and Mass Communication,[164] and others have hosted seminars and presentations to discuss ramifications of students’ use of Facebook and other social networking systems. Sony VAIO VGN-NW24MG Battery

 

The EDUCAUSE Learning Initiative has also released a brief pamphlet entitled “7 Things You Should Know About Facebook” aimed at higher education professionals that “describes what [Facebook] is, where it is going, and why it matters to teaching and learning”.[165] Sony VAIO VGN-NW24MR Battery

 

Some research[citation needed] on Facebook in higher education suggests that there may be some small educational benefits associated with student Facebook use, including improving engagement which is related to student retention.[166] More recent research [167

 

Sony VAIO VGN-FW46S Battery] has found that time spent on Facebook is related to involvement in campus activities. This same study found that certain Facebook activities like commenting and creating or RSVPing to events were positively related to student engagement while playing games and checking up on friends was negatively related. Sony VAIO VGN-NW26EG Battery

Sony VAIO VGN-NW26JG BatteryFurthermore, using technologies such as Facebook to connect with others can help college students be less depressed and cope with feelings of loneliness and homesickness.[168]

[edit]Effect on college student grades

As of February 2012, only four published peer-reviewed studies have examined the relationship between Facebook use and grades [169] [170] [171] [172]. There is considerable variance in the findings. Pasek et al. (2009)[173] found there was no relationship between Facebook use and grades. Kolek and Saunders (2008) [174] Sony VAIO VGN-FW46S Battery

found that there were no differences in overall grade point average (GPA) between users and non-users of Facebook. Kirschner and Karpinski (2010)[175] found that Facebook users reported a lower mean GPA than non-users. Junco’s (2012) [1Sony VAIO VGN-FW46Z Battery

76] study clarifies the discrepancies in these findings. While Junco (2012)[177] found a negative relationship between time spent on Facebook and student GPA in his large sample of college students, the real-world impact of the relationship was negligible. Furthermore, Junco (2012)[1

 

Sony VAIO VGN-FW54M Battery78] found that sharing links and checking up on friends was positively related to GPA while posting status updates was negatively related. In addition to noting the differences in how Facebook use was measured among the four studies, Junco (2012)[179] concludes that the ways in which students use Facebook are more important in predicting academic outcomes.

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[edit]Third-party responses to Facebook

 

[edit]Government censorship

Main article: Censorship of Facebook

Several countries have banned access to it including Syria,[180] China,[181] Iran,[182] and Vietnam.[183]

In 2010, Facebook reportedly allowed an objectionable page, deemed by the Islamic Lawyers Forum (ILF), to be anti-Muslim. The ILF filed a petition with Pakistan’s Lahore High Court. On May 18, 2010, Justice Ijaz Ahmad Chaudhry ordered Pakistan’s Telecommunication Authority to block access to Facebook until May 31. Sony VAIO VGN-FW54E Battery

 

The offensive page had provoked street demonstrations in Muslim countries due to visual depictions of Prophet Mohammed, which are regarded as blasphemous by Muslims.[184][185] A spokesman said Pakistan Telecommunication Authority would move to implement the ban once the order has been issued by the Ministry of Information and Technology. Sony VAIO VGN-FW54J Battery

“We will implement the order as soon as we get the instructions”, Khurram Mehran told AFP. “We have already blocked the URL link and issued instruction to Internet service providers yesterday”, he added. Rai Bashir told AFP that “We moved the petition in the wake of widespread resentment in the Muslim community against the Facebook contents”.Sony VAIO VGN-FW54S Battery The petition called on the government of Pakistan to lodge a strong protest with the owners of Facebook, he added. Bashir said a PTA official told the judge his organisation had blocked the page, but the court ordered a total ban on the site. People demonstrated outside court in the eastern city of Lahore, Pakistan, carrying banners condemning FacebookSony Vaio VGN-SR49VN/H Battery

. Protests in Pakistan on a larger scale took place after the ban and widespread news of that objectionable page. The ban was lifted on May 31 after Facebook reportedly assured the Lahore High Court that it would remedy the issues in dispute.[186][187][188] Sony Vaio VGN-FW56Z Battery

 

In 2011, a court in Pakistan was petitioned to place a permanent ban on Facebook for hosting a page called “2nd Annual Draw Muhammad Day May 20th 2011.”[189][190]

[edit]Organizations blocking access

Ontario government employees, Federal public servants, MPPs, and cabinet ministers were blocked from access to Facebook on government computers in May 2007.[191Sony Vaio VGN-SR57S Battery

] When the employees tried to access Facebook, a warning message “The Internet website that you have requested has been deemed unacceptable for use for government business purposes”. This warning also appears when employees try to access YouTube, MySpace, gambling or pornographic websites.[192] Sony Vaio VGN-SR57V Battery

However, innovative employees have found ways around such protocols, and many claim to use the site for political or work-related purposes.[193]

A number of local governments including those in the UK[194] and Finland [195] imposed restrictions on the use of Facebook in the workplace due to the technical strain incurred. Other government-related agencies, such as the US Marine Corps have imposed similar restrictions.[196]

 

Sony Vaio VGN-SR49VT/H BatteryA number of hospitals in Finland have also restricted Facebook use citing privacy concerns.[197][198]

Employees of Broward County, Florida have been blocked from accessing Facebook and most social networking and blog sites since 2009. Sony Vaio VGN-SR57X Battery

 

[edit]Schools blocking access

The University of New Mexico (UNM) in October 2005 blocked access to Facebook from UNM campus computers and networks, citing unsolicited e-mails and a similar site called UNM Facebook.[199] After a UNM user signed into Facebook from off campus, a message from Facebook said, “We are working with the UNM administration to lift the block and have explained that it was instituted based on erroneous information, Sony Vaio VGN-SR59TH/H Battery

but they have not yet committed to restore your access.” UNM, in a message to students who tried to access the site from the UNM network, wrote, “This site is temporarily unavailable while UNM and the site owners work out procedural issues. The site is in violation of UNM’s Acceptable Computer Use Policy for abusing computing resources (e.g. Sony Vaio VGN-SR59VG/H Battery

, spamming, trademark infringement, etc). The site forces use of UNM credentials (e.g., NetID or email address) for non-UNM business.” However, after Facebook created an encrypted login and displayed a precautionary message not to use university passwords for access, UNM unblocked access the following spring semester.[200] Sony Vaio VGN-SR59XG/H Battery

 

The Columbus Dispatch reported on June 22, 2006, that Kent State University’s athletic director had planned to ban the use of Facebook by athletes and gave them until August 1 to delete their accounts.[201] On July 5, 2006, the Daily Kent Stater reported that the director reversed the decision after reviewing the privacy settings of Facebook.[citation needed] Sony Vaio VGN-FW56ZR Battery

[edit]Closed social networks

Several web sites concerned with social networking, such as Plugtodo.com and salesforce have criticized the lack of information that users get when they share data. Advanced users cannot limit the amount of information anyone can access in their profiles, but Facebook promotes the sharing of personal information for marketing purposes,

Sony Vaio VGN-FW56SR Battery leading to the promotion of the service using personal data from users who are not fully aware of this. Facebook exposes personal data, without supporting open standards for data interchange.[202] According to several communities [203]

 

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and authors [204] closed social networking, on the other hand, promotes data retrieval from other people while not exposing one’s personal information.

Openbook was established in early 2010 both as a parody of Facebook and a critique of its changing privacy management protocols.[205] Sony  VAIO VGN-FW21E Battery

 

[edit]Class action lawsuit

On November 17, 2009, Rebecca Swift, on behalf of herself and all others similarly situated, filed a class action lawsuit against Zynga Game Network Inc. and Facebook, Inc. in the United States District Court for the Northern District of California for violation of the Unfair competition law and the Consumers Legal Remedies Act, and for unjust enrichment.[206][207] Sony  VAIO VGN-FW21I Battery

 

[edit]Litigation

 

[edit]ConnectU.com lawsuit

Main article: ConnectU

Divya Narendra, Cameron Winklevoss, and Tyler Winklevoss, founders of the social networking website ConnectU, filed a lawsuit against Facebook in September 2004. The lawsuit alleged that Zuckerberg had broken an oral contract to build the social networking site, copied the idea,[208][209] and used source code that they provided to Zuckerberg to create competing site Facebook.

 

Sony VAIO VGN-FW51ZF/H Battery Facebook countersued in regards to Social Butterfly, a project put out by The Winklevoss Chang Group, an alleged partnership between ConnectU and i2hub. It named among the defendants ConnectU, Cameron Winklevoss, Tyler Winklevoss, Divya Narendra, and Wayne Chang, founder of i2hub.[214] The parties reached a settlement agreement in February, 2008, for $20 million in cash and 1,253,326 Facebook shares. On August 26, 2010, The New York Times reported that Facebook shares were trading at $76 per share in the secondary market, putting the total settlement value now at close to $120 million.[215][216]

 

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ConnectU filed another lawsuit against Facebook on March 11, 2008,[217] attempting to rescind the settlement, claiming that Facebook, in settlement negotiations, had overstated the value of stock it was granting the ConnectU founders as part of the settlement. ConnectU argued that Facebook represented itself as being worth $15 billion at the time, due to the post-money valuation arising from Microsoft’s purchase in 2007 of a 1.6% stake in Facebook for US $246 million. Facebook announced that valuation in a press release.[21Sony  VAIO VGN-FW21L Battery

 

Sony VAIO VGN-FW51 Battery 8] However, Facebook subsequently performed an internal valuation that estimated a company value of $3.75 billion.[219] ConnectU then fired the law firm Quinn Emanuel that had represented it in settlement discussions. Quinn Emanuel filed a $13 million lien against the settlement proceeds and ConnectU sued for malpractice.[220] On August 25, 2010, an arbitration panel ruled that Quinn Emanuel had “earned its full contingency fee”. Sony  VAIO VGN-FW21Z Battery

 

It also found that Quinn Emanuel committed no malpractice.[221] ConnectU’s lawsuit against Facebook to quadruple its settlement remains ongoing.

In January 2010, it was reported that i2hub founder Wayne Chang and The i2hub Organization launched a lawsuit against ConnectU and its founders, Cameron Winklevoss, Tyler Winklevoss, and Divya Narendra, seeking 50% of the settlement. The complaint states Sony  VAIO VGN-FW21M Battery

 

“Through this litigation, Chang asserts his ownership interest in The Winklevoss Chang Group and ConnectU, including the settlement proceeds.”[222] Lee Gesmer (of Gesmer Updegrove, LLP) posted the detailed 33-page complaint online.[223][224] On April 12, 2011, a three-judge panel of a federal appeals court in San Francisco ruled that the Winklevoss brothers, Sony  VAIO VGN-FW31M Battery

whose fight over Facebook’s origins was a major narrative arc of the film The Social Network, cannot back out of a settlement they signed with the company in 2008.

[edit]Aaron Greenspan and houseSYSTEM

As the President of the Harvard College Student Entrepreneurship Council (a now-defunct student group) and the CEO of Think Computer Corporation,[225] Aaron Greenspan created a web portal as a Harvard undergraduate called houseSYSTEM that launched on August 1, 2003.

 

Sony VAIO VGN-FW4ZTJ/HDesigned to centralize student life in a more user-friendly manner than Harvard’s official student portal, my.harvard, houseSYSTEM had a variety of features, including an event calendar with digital RSVP, a photo album, user-uploadable “posters”, a teaching feedback system called CriticalMass,[226] an on-line trading post called Student Exchange, and, as of September 19, 2003, a “Universal Face Book”,Sony  VAIO VGN-FW31J Battery

 

Sony VAIO VGN-FW46M Battery which was also referred to at times as “The Facebook.” Greenspan began communicating with fellow classmate Mark Zuckerberg via e-mail shortly after launching the houseSYSTEM Facebook in September after reading a profile of Zuckerberg in The Harvard Crimson news magazine. They met in person in early January 2004, at which point Zuckerberg, as well as future Facebook, Inc. co-founders Dustin Moskovitz, Sony VAIO VGN-FW11ZRU Battery

Eduardo Saverin, and Chris Hughes were already houseSYSTEM members. (Cameron Winklevoss and Victor Gao of the ConnectU team were also houseSYSTEM members.) Though Greenspan and Zuckerberg decided to work on their respective projects independently, they frequently discussed technological aspects of houseSYSTEM related to the Facebook, Sony VAIO VGN-FW11ZU Battery

as well as Zuckerberg’s unspecified latest project, about which he was secretive, using AOL Instant Messenger.[227] Throughout the spring semester of 2004, Greenspan and Zuckerberg were both enrolled in CS91r (also called Applied Math 91r), a ten-person computer science seminar that focused on using the PHP programming language with voice recognition technology.[228] Sony VAIO VGN-FW21ER Battery

 

On January 11, 2004, a few days after meeting Greenspan and concurrent with using the Universal Face Book on houseSYSTEM, Zuckerberg registered the domain name “thefacebook.com” independently.[229] Sony VAIO VGN-FW21J Battery

On February 4, 2004, when thefacebook.com launched, Greenspan recognized aspects of his own work in the site, and later came to believe that Zuckerberg was copying his work one feature at a time—a claim that Zuckerberg denied. Many of the features Greenspan created for houseSYSTEM, such as the digital event posters, electronic RSVPs, Sony VAIO VGN-FW21ZR

Sony VAIO VGN-FW3ZJ Battery organizational pages, photo album, and marketplace, did eventually appear on thefacebook.com under similar names. Zuckerberg was aware of these features, eventually telling Greenspan at one point, “your facenet thing is hot”.[230] Social networking functionality was added to houseSYSTEM in March 2004, and the name “FaceNet” replaced the “Universal Face Book”. Regarding Greenspan’s allegations, Sony VGN-CS21S/P Battery

 

Sony VAIO VGN-NW21JF/S BatteryZuckerberg was described in The New York Times as “saying through a spokeswoman that he was not sure how to respond.”[231]

In 2008, when Greenspan published a book entitled Authoritas: One Student’s Harvard Admissions and the Founding of the Facebook Era describing his side of the story of Facebook’s birth as well as events leading up to it (including aggressive actions on behalf of the Harvard University administration),[232] Sony VGN-CS21S/R Battery

 

Sony VAIO VGN-NW21MF/P Battery he was prohibited from advertising the book using Google AdWords because of the inclusion of the word “Facebook” in the book’s subtitle, and the existence of Facebook, Inc.’s registered trademark on the term “Facebook”.[233] The trademark had come into existence two years before in 2006, partially as a defensive measure during a battle over the “facebook.com” domain name in the ConnectU lawsuit.[234]

Greenspan’s company filed a Petition to Cancel the “Facebook” trademark, which included claims of prior use and fraud by Facebook, Inc. against the USPTO.[235] Greenspan represented himself for the majority of the proceedings, and the USPTO TTAB found his claims to be adequate. Facebook, Inc. agreed to a formal settlement with Greenspan in late May, 2009 and issued a press release, but the terms were not disclosed.[236] Sony VGN-CS21S/T Battery

 

Sony VAIO VGN-NW21MF/W Battery

Greenspan is incorrectly referred to repeatedly as “Aaron Grossman” in Ben Mezrich’s book, The Accidental Billionaires.[237] Greenspan declined to cooperate with Mezrich on the book due to Mezrich’s reputation for character distortion and consequently was not included in the resulting screenplay for The Social Network, even though Mezrich cited Authoritas as a source. Sony VGN-CS21S/V Battery

 

Greenspan has written a number of articles critical of Facebook on The Huffington Post.[238]

[edit]Paul Ceglia

On June 30, 2010, Paul Ceglia, the owner of a wood pellet fuel company in Allegany County, New York, filed a lawsuit against Zuckerberg, claiming 84% ownership of Facebook as well as additional monetary damages. According to Ceglia, he and Zuckerberg signed a contract on April 28, 2003, that for an initial fee of $1,000, Sony VGN-CS21S/W Battery

 

Sony VAIO VGN-NW21ZF/S Batteryentitles Ceglia to 50% of the website’s revenue, as well as additional 1% interest per each day after January 1, 2004, until website completion. Zuckerberg was developing other projects at the time, among which was Facemash, the predecessor of Facebook, but did not register the domain name thefacebook.com until January 1, 2004. Facebook management has dismissed the lawsuit as “completely frivolous”.Sony VGN-CS21Z/Q Battery

Facebook spokesman Barry Schnitt issued a statement indicating that the counsel for Ceglia had unsuccessfully attempted to seek an out-of-court settlement. In an interview to ABC World News, Zuckerberg stated he is confident of never signing such an agreement. At the time, Zuckerberg worked for Ceglia as a code developer on a project named “StreetFax”. Sony VGN-CS11S/P Battery

Judge Thomas Brown of Allegany Court issued a restraining order on all financial transfers concerning ownership of Facebook until further notice; in response, Facebook management successfully filed for the case to be moved to federal court. According to Facebook, the order does not affect their business but lacks legal basis. Sony VGN-CS11S/Q Battery

 

[edit]Young v. Facebook, Inc.

In Young v. Facebook, Inc., plaintiff Karen Beth Young alleged violations of the Americans with Disabilities Act and related state laws on disability as well as breach of contract and negligence. A District Court judge dismissed the complaint, ruling that Facebook is a website, not a physical place, so the Americans with Disabilities Act does not apply.[245] Sony VGN-CS11S/W Battery

 

[edit]Terms of Use controversy

 

While Facebook originally made changes to its terms of use [246] or, terms of service, on February 4, 2009, the changes went unnoticed until Chris Walters, a blogger for the consumer-oriented blog, The Consumerist, noticed the change on February 15, 2009.[247] Walters complained the change gave Facebook the right to “Do anything they want with your content. Forever.”[248] The section under the most controversy is the “User Content Posted on the Site” clause. Before the changes, the clause read: Sony VGN-CS11Z/R Battery

 

“You may remove your User Content from the Site at any time. If you choose to remove your User Content, the license granted above will automatically expire, however you acknowledge that the Company may retain archived copies of your User Content.”[246] Sony VGN-CS11Z/T Battery

 

The “license granted” refers to the license that Facebook has to your “name, likeness, and image” to use in promotions and external advertising.[246] The new terms of use deleted the phrase that states the license would “automatically expire” if a user chose to remove content. By omitting this line, Facebook license extends to adopt users’ content perpetually and irrevocably years after the content has been deleted.[247] Sony VGN-CS31S/P Battery

 

Many users of Facebook voiced opinions against the changes to the Facebook Terms of Use, leading to an Internet-wide debate over the ownership of content. The Electronic Privacy Information Center (EPIC) prepared a formal complaint with the Federal Trade Commission. Many individuals were frustrated with the removal of the controversial clause. Facebook users, Sony VGN-CS31S/R Battery

numbering more than 38,000, joined a user group against the changes, and a number of blogs and news sites have written about this issue.[247]

After the change was brought to light in Walters’s blog entry, in his blog on February 16, 2009, Zuckerberg addressed the issues concerning the recently made changes to Facebook’s terms of use. Zuckerberg wrote “Our philosophy is that people own their information and control who they share it with.”[249] Sony VGN-CS31S/T Battery

In addition to this statement Zuckerberg explained the paradox created when people want to share their information (phone number, pictures, email address, etc.) with the public, but at the same time desire to remain in complete control of who has access to this info.[136]

 

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In order to calm criticism, Facebook returned to its original terms of use. However, on February 17, 2009, Zuckerberg wrote in his blog, that although Facebook reverted to its original terms of use, it is in the process of developing new terms in order to address the paradox. Zuckerberg stated that these new terms will allow Facebook users to “share and control their information, and it will be written clearly in language everyone can understand.” Sony VGN-CS31S/V Battery

Zuckerberg invited users to join a group entitled “Facebook Bill of Rights and Responsibilities”[250] to give their input and help shape the new terms.

On February 26, 2009, Zuckerberg posted a blog, updating users on the progress of the new Terms of Use. He wrote, “We decided we needed to do things differently and so we’re going to develop new policies that will govern our system from the ground up in an open and transparent way.” Zuckerberg introduces the two new additions to Facebook: the Facebook Principles[251] Sony VGN-CS31S/W Battery

and the Statement of Rights and Responsibilities[252] Both additions allow users to vote on changes to the terms of use before they are officially released. Because “Facebook is still in the business of introducing new and therefore potentially disruptive technologies”, Zuckerberg explains, users need to adjust and familiarize themselves with the products before they can adequately show their support.[253] Sony VGN-CS31Z/Q Battery

 

This new voting system was initially applauded as Facebook’s step to a more democratized social network system.[254] However, the new terms were harshly criticized in a report by computer scientists from the University of Cambridge, SONY VGN-FW41E/H BATTERY

who stated that the democratic process surrounding the new terms is disingenuous and significant problems remain in the new terms.[255] The report was endorsed by the Open Rights Group.[256]

 

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In December 2009, EPIC and a number of other US privacy organizations filed another complaint with the Federal Trade Commission regarding Facebook’s Terms of Service. In January 2011 EPIC filed a subsequent complaint claiming that Facebook’s new policy of sharing users’ home address and mobile phone information with third-party developers were “misleading and fail[ed] to provide users clear and privacy protections”, SONY VGN-FW41J/H BATTERY

particularly for children under age 18.[257] Facebook temporarily suspended implementation of its policy in February 2011, but the following month announced it was “actively considering” reinstating the 3rd party policy. SONY VGN-FW41M/H BATTERY

[edit]Interoperability and data portability

 

Facebook has been criticized for failing to offer users a feature to export their friends’ information, such as contact information, for use with other services or software.[258][259][260][261] The inability of users to export their social graph in an open standard format contributes to vendor lock-in and contravenes the principles of data portability.[262SONY VGN-FW41ZJ/H BATTERY

Automated collection of user information without Facebook's consent violates its Statement of Rights and Responsibilities,[263] and third-party attempts to do so (e.g., Web scraping) have resulted in suspension of accounts,[264] cease and desist letters,[265] and litigation with one of the third parties, Power.com.

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Facebook Connect has been criticized for its lack of interoperability with OpenID.[266]

[edit]Better Business Bureau review

 

As of December 2010, the Better Business Bureau gave Facebook an “A” rating”[267][268]

As of December 2010, the 36-month running count of complaints about Facebook logged with the Better Business Bureau is 1136, including 101 (“Making a full refund, as the consumer requested”), 868 (“Agreeing to perform according to their contract”), Sony VAIO VGN-NW11S/T Battery

 

Sony Vaio VGN-AW11M/H Battery1 (“Refuse [sic] to adjust, relying on terms of agreement”), 20 (“Unassigned”), 0 (“Unanswered”) and 136 (“Refusing to make an adjustment”).[267] Facebook reportedly claimed to the BBB that some customers had received warnings for violations when none were actually sent.[269] Sony VAIO VGN-NW11Z/T Battery

[edit]Security

 

Facebook’s software has proven vulnerable to likejacking. On July 28, 2010 the BBC reported that security consultant Ron Bowes used a piece of code to scan Facebook profiles to collect data of 100 million profiles. The data collected was not hidden by the user’s privacy settings. Bowes then published the list online. Sony VAIO VGN-NW11Z/S Battery

 

Sony Vaio VGN-AW11S/B Battery

This list, which has been shared as a downloadable file, contains the URL of every searchable Facebook user’s profile, their name and unique ID. Bowes said he published the data to highlight privacy issues, but Facebook claimed it was already public information.[270] Sony VAIO VGN-NW31JF/S Battery

 

[edit]Environment

 

See also: Green computing

In 2010, Prineville, Oregon was chosen as the site for a new Facebook data center.[271] However the center has been met with criticism from environmental groups such as Greenpeace because the power utility company contracted for the center, PacifiCorp, generates 60% of its electricity from coal.[272][273][274] In September 2010, Sony VAIO VGN-NW21ZF/T Battery

 

Sony Vaio VGN-AW11SR/B BatteryFacebook received a letter from Greenpeace containing half a million signatures asking the company to cut its ties to coal based electricity.[275]

Twitter is an online social networking service and microblogging service that enables its users to send and read text-based posts of up to 140 characters, known as “tweets”. It was created in March 2006 by Jack Dorsey and launched that July. The service rapidly gained worldwide popularity, with over 140 million active users as of 2012[5Sony VAIO VGN-NW21ZF/S Battery

 

Sony Vaio VGN-AW11XU/Q Battery ], generating over 340 millions tweets daily[5] and handling over 1.6 billion search queries per day.[7][8] It has been described as “the SMS of the Internet.”[9]

Twitter Inc. is based in San Francisco, with additional servers and offices in New York City.

Twitter’s origins lie in a “daylong brainstorming session” held by board members of the podcasting company Odeo. Dorsey introduced the idea of an individual using an SMS service to communicate with a small group.[10] Sony VAIO VGN-NW21MF/W Battery

 

Sony Vaio VGN-AW11Z/B Battery The original project code name for the service was twttr, an idea that Williams later ascribed to Noah Glass,[11] inspired by Flickr and the five-character length of American SMS short codes. The developers initially considered “10958″ as a short code, but later changed it to “40404″ for “ease of use and memorability.”[12] Sony VAIO VGN-NW21MF/P Battery

Sony Vaio VGN-AW11ZR/B Battery Work on the project started on March 21, 2006, when Dorsey published the first Twitter message at 9:50 PM Pacific Standard Time (PST): “just setting up my twttr”.[13]

“…we came across the word ‘twitter’, and it was just perfect. The definition was ‘a short burst of inconsequential information,’ and ‘chirps from birds’. And that’s exactly what the product was.” – Jack Dorsey[14]

 

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The first Twitter prototype was used as an internal service for Odeo employees and the full version was introduced publicly on July 15, 2006.[6] In October 2006, Biz Stone, Evan Williams, Dorsey, and other members of Odeo formed Obvious Corporation and acquired Odeo and all of its assets – including Odeo.com and Twitter.com – from the investors and shareholders.[15] Williams fired Glass who was silent about his part in Twitter’s startup until 2011.[16] Twitter spun off into its own company in April 2007.[17] Sony VAIO VGN-NW20EF/P Battery

Sony Vaio VGN-AW21M Battery

Reaction

The tipping point for Twitter’s popularity was the 2007 South by Southwest Interactive (SXSWi) conference. During the event, Twitter usage increased from 20,000 tweets per day to 60,000.[18] “The Twitter people cleverly placed two 60-inch plasma screens in the conference hallways, exclusively streaming Twitter messages,” remarked Newsweek’s Steven Levy.

 

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“Hundreds of conference-goers kept tabs on each other via constant twitters. Panelists and speakers mentioned the service, and the bloggers in attendance touted it.”[19]

Reaction at the conference was highly positive. Blogger Scott Beale said that Twitter “absolutely rul[ed]” SXSWi. Social software researcher danah boyd said Twitter “own[ed]” the conference.[20]

 

Sony Vaio VGN-AW21XY/Q BatteryTwitter staff received the festival’s Web Award prize with the remark “we’d like to thank you in 140 characters or less. And we just did!”[21]

 

 

Previous Twitter logo, used until September 14, 2010.

The first unassisted off-Earth Twitter message was posted from the International Space Station by NASA astronaut T. J. Creamer on January 22, 2010.[22] By late November 2010, an average of a dozen updates per day were posted on the astronauts’ communal account, @NASA_Astronauts. NASA has also hosted over 25 “tweetups”, Sony VAIO VGN-NW20EF/w Battery

events that provide guests with VIP access to NASA facilities and speakers with the goal of leveraging participants’ social networks to further the outreach goals of NASA.

In August 2010, the company appointed Adam Bain as President of Revenue from News Corp.’s Fox Audience Network.[23] Sony VAIO VGN-NW20EF/S Battery

 

On September 14, 2010, Twitter launched a redesigned site[24] including a new logo.[citation needed]

Leadership

As chief executive officer, Dorsey saw the startup through two rounds of capital funding by the venture capitalists who backed the company.[25]

On October 16, 2008,[26] Williams took over the role of CEO, and Dorsey became chairman of the board.[27]

 

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On October 4, 2010, Williams announced that he was stepping down as CEO. Dick Costolo, formerly Twitter’s chief operating officer, became CEO. According to a Twitter blog, dated October 4, 2010, Williams was to stay[dated info] with the company and “be completely focused on product strategy.”[dated info][28] Sony VAIO VGN-NW31EF Battery

 

According to The New York Times, “Mr. Dorsey and Mr. Costolo forged a close relationship” when Williams was away.[29] According to PC Magazine, Williams was “no longer involved in the day-to-day goings on at the company”. He is focused on developing a new startup, but he became a member of Twitter’s board of directors, and promised to “help in any way I can”. Sony VAIO VGN-NW31ZF/S Battery

Stone is still with Twitter but is working with AOL as an “advisor on volunteer efforts and philanthropy”.[30]

Dorsey rejoined Twitter in March 2011, as executive chairman focusing on product development. His time is split with Square (where he is CEO), whose offices are within walking distance of Twitter’s in San Francisco.[29]

 

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In September 2011, board members and investors Fred Wilson and Bijan Sabet resigned from Twitter’s Board of Directors.[31]

Growth

The company experienced rapid growth. It had 400,000 tweets posted per quarter in 2007. This grew to 100 million tweets posted per quarter in 2008. In February 2010, Twitter users were sending 50 million tweets per day.[32Sony VAIO VGN-NW21JF/S Battery 

Sony Vaio VGN-AW41ZF/B Battery

] By March 2010, the company recorded over 70,000 registered applications.[33] As of June 2010, about 65 million tweets were posted each day, equaling about 750 tweets sent each second, according to Twitter.[34] Sony Vaio VGN-AW41MF/H Battery

As of March 2011, that was about 140 million tweets posted daily.[35] As noted on Compete.com, Twitter moved up to the third-highest-ranking social networking site in January 2009 from its previous rank of twenty-second.[36] Sony Vaio VGN-AW41XH/Q Battery

 

Twitter’s usage spikes during prominent events. For example, a record was set during the 2010 FIFA World Cup when fans wrote 2,940 tweets per second in the thirty-second period after Japan scored against Cameroon on June 14, 2010. The record was broken again when 3,085 tweets per second were posted after the Los Angeles Lakers’ victory in the 2010 NBA Finals on June 17,

 

Sony Vaio VGN-AW31M/H Battery2010,[37] and then again at the close of Japan’s victory over Denmark in the World Cup when users published 3,283 tweets per second.[38] The current record was set during the 2011 FIFA Women’s World Cup Final between Japan and the United States, when 7,196 tweets per second were published.[39] Sony Vaio VGN-AW41JF/H Battery

Sony Vaio VGN-AW31ZJ/B Battery

Sony Vaio VGN-AW31S/B Battery When American singer Michael Jackson died on June 25, 2009, Twitter servers crashed after users were updating their status to include the words “Michael Jackson” at a rate of 100,000 tweets per hour.[40]

Twitter acquired application developer Atebits on April 11, 2010. Atebits had developed the Apple Design Award-winning Twitter client Tweetie for the Mac and iPhone. The application, now called “Twitter” and distributed free of charge, is the official Twitter client for the iPhone, iPad and Mac.[41] Sony VAIO VGN-NW21MF/W Battery

Sony VAIO VGN-NW20EF Battery

 

From September through October 2010, the company began rolling out “New Twitter”, an entirely revamped edition of twitter.com. Changes included the ability to see pictures and videos without leaving Twitter itself by clicking on individual tweets which contain links to images and clips from a variety of supported websites including YouTube and Flickr, Sony VAIO VGN-NW24S Battery

and a complete overhaul of the interface, which shifted links such as ‘@mentions’ and ‘Retweets’ above the Twitter stream, while ‘Messages’ and ‘Log Out’ became accessible via a black bar at the very top of twitter.com. As of November 1, 2010, the company confirmed that the “New Twitter experience” had been rolled out to all users. Sony VAIO VGN-NW26M Battery

 

On April 5, 2011, Twitter tested a new homepage and phased out the “Old Twitter.”[42] However, a glitch came about after the page was launched, so the previous “retro” homepage was still in use until the issues were resolved; the new homepage was reintroduced on April 20.[43][44] Sony VAIO VGN-NW20ZF Battery

 

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Sony VAIO VGN-NW21JF/S 

On December 8, 2011, Twitter overhauled its website once more to feature the “Fly” design, which the service says is easier for new users to follow and promotes advertising. In addition to the Home button, the Connect and Discover buttons were introduced along with a redesigned profile and timeline of Tweets. The site’s layout has been compared to that of Facebook.[45][46]

On February 21, 2012, Sony VAIO VGN-NW20SF Battery

it was announced that twitter and Yandex agreed to a partnership. Yandex, a Russian search engine, finds value within the partnership due to Twitter’s real time news feeds. Twitter’s director of business development explained that it is important to have Twitter content where Twitter users go. [47] Sony VAIO VGN-NW21MF/P Battery

 

On March 21, 2012, Twitter celebrated it’s sixth birthday while also announcing that it has 140 million users and sees 340 million tweets per day. The number of users is up 40% from their September 2011 number, which was said to have been at 100 million at the time. [48]

In April 2012, Twitter announced that it was opening an office in Detroit, with the aim of working with automotive brands and advertising agencies.[49] Sony VAIO VGN-NW20EF/P Battery

 

Sony VAIO VGN-FW56 Battery Twitter also expanded its office in Dublin.[50]

“Larry the Bird” Logo

On Monday, February 27, 2012, a tweet from an employee that works on the company’s platform and API discussed the evolution of the “Larry the Bird” logo with Twitter’s creative director and it was revealed that it was named after Larry Bird of the NBA’s Boston Celtics fame.

 

Sony VAIO VGN-FW54S BatteryThis detail had previously been confirmed when the Boston Celtic’s director of interactive media asked Twitter co-founder Biz Stone about it in August 2011.[51]

Features

 

Tweets are publicly visible by default; however, senders can restrict message delivery to just their followers. Users can tweet via the Twitter website, compatible external applications (such as for smartphones), or by Short Message Service (SMS) available in certain countries.[52] Sony VAIO VGN-NW20EF/w Battery

While the service is free, accessing it through SMS may incur phone service provider fees.

Users may subscribe to other users’ tweets – this is known as following and subscribers are known as followers[53] or tweeps (Twitter + peeps).[54] The users can also check the people who are un-subscribing them on Twitter better known as unfollowing via various services.[55]

 

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Twitter allows users the ability to update their profile by using their mobile phone either by text messaging or by apps released for certain smartphones / tablets.[56]

Twitter has been compared to a web-based Internet Relay Chat (IRC) client.[57] In a 2009 Time essay, technology author Steven Johnson described the basic mechanics of Twitter as “remarkably simple”:[58] Sony VAIO VGN-NW20EF/S Battery

 

As a social network, Twitter revolves around the principle of followers. When you choose to follow another Twitter user, that user’s tweets appear in reverse chronological order on your main Twitter page. If you follow 20 people, you’ll see a mix of tweets scrolling down the page: breakfast-cereal updates, interesting new links, music recommendations, even musings on the future of education. Sony VAIO VGN-NW31EF Battery

 

In June 2008, Twitter launched a verification program, allowing celebrities to get their accounts verified.[59] Originally intended to help users verify which celebrity accounts were created by the celebrities themselves (and therefore are not fake), they have since been used to verify accounts of businesses and accounts for public figures who may not actually tweet but still wish to maintain control over the account that bears their name – for example, the Dalai Lama. Sony VAIO VGN-NW31ZF/S Battery

Verified accounts can be identified by a white tick on a blue background, known as a verified badge, next to the user’s full name, on the profile itself or next to the name in search results.

Messages

Users can group posts together by topic or type by use of hashtags – words or phrases prefixed with a “#” sign. Similarly, the “@” sign followed by a username is used for mentioning or replying to other users.[60] To repost a message from another Twitter user, and share it with one’s own followers, the retweet function is symbolized by “RT” in the message. Sony VAIO VGN-FW56E Battery

 

In late 2009, the “Twitter Lists” feature was added, making it possible for users to follow (as well as mention and reply to) ad-hoc lists of authors instead of individual authors.[53][61]

Through SMS, users can communicate with Twitter through five gateway numbers: short codes for the United States, Canada, India, New Zealand, and an Isle of Man-based number for international use. Sony VAIO VGN-FW56J Battery

There is also a short code in the United Kingdom which is only accessible to those on the Vodafone, O2[62] and Orange[63] networks. In India, since Twitter only supports tweets from Bharti Airtel,[64] an alternative platform called smsTweet[6Sony VAIO VGN-NW24EG Battery

5] was set up by a user to work on all networks.[66] A similar platform called GladlyCast[67] exists for mobile phone users in Singapore, Malaysia and the Philippines.

The messages were initially set to a 140-character limit for compatibility with SMS messaging, introducing the shorthand notation and slang commonly used in SMS messages. The 140-character limit has also increased the usage of URL shortening services such as bit.ly, goo.gl, and tr.im, and content-hosting services, such as Twitpic, Sony VAIO VGN-NW24JG Battery

memozu.com and NotePub to accommodate multimedia content and text longer than 140 characters. Twitter uses its own t.co domain for automatic shortening of all URLs posted on its website.[68]

 

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Tweet contents

San Antonio-based market-research firm Pear Analytics analyzed 2,000 tweets (originating from the US and in English) over a two-week period in August 2009 from 11:00 AM to 5:00 PM (CST) and separated them into six categories:[69] Sony VAIO VGN-NW24MG Battery

 

Social networking researcher danah boyd responded to the Pear Analytics survey by arguing that what the Pear researchers labelled “pointless babble” is better characterized as “social grooming” and/or “peripheral awareness” (which she explains as persons “want[ing] to know what the people around them are thinking and doing and feeling, even when co-presence isn’t viable”).[70]

 

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Rankings

Twitter is ranked as one of the ten-most-visited websites worldwide by Alexa’s web traffic analysis.[71] Daily user estimates vary as the company does not publish statistics on active accounts. A February 2009 Compete.com blog entry ranked Twitter as the third most used social network based on their count of 6 million unique monthly visitors and 55 million monthly visits.[72] In March 2009, Sony VAIO VGN-NW24MR Battery

a Nielsen.com blog ranked Twitter as the fastest-growing website in the Member Communities category for February 2009. Twitter had annual growth of 1,382 percent, increasing from 475,000 unique visitors in February 2008 to 7 million in February 2009. It was followed by Zimbio with a 240 percent increase, and Facebook with a 228 percent increase.[73] Twitter has a user retention rate of forty percent.[74] Sony VAIO VGN-NW26EG Battery

 

Adding and following content

There are numerous tools for adding content, monitoring content and conversations including Twitvid (video sharing),[75] TweetDeck, Salesforce.com, HootSuite, and Twitterfeed. Fewer than half of tweets are posted using the web user interface with most users using third-party applications (based on analysis of 500 million tweets by Sysomos).[76] Sony VAIO VGN-NW26JG Battery

Trends

A word, phrase or topic that is tagged at a greater rate than other tags is said to be a trending topic. Trending topics become popular either through a concerted effort by users or because of an event that prompts people to talk about one specific topic.[77] These topics help Twitter and their users to understand what is happening in the world.[78]

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Trending topics are sometimes the result of concerted efforts by fans of certain celebrities or cultural phenomena, particularly Lady Gaga (known as Monsters), Justin Bieber (Beliebers) and the Twilight and Harry Potter novels. Twitter have altered the trend algorithm in the past to prevent manipulation of this type.[79] Sony VAIO VGN-SR11M Battery

Twitter’s March 30, 2010 blog post announced that the hottest Twitter trending topics will scroll across the Twitter homepage.[80] Users will also be able to find out how a specific topic became a trending topic. Sony VAIO VGN-SR11MR Battery

 

 

 

There have been controversy surrounding the Twitter trending topics: Twitter censored hashtags that their users found offensive. Twitter censored the #Thatsafrican[81] and the #thingsdarkiessay[82] hashtags after users complained that they found the hashtags offensive.

Authentication. Sony VAIO VGN-SR19VN Battery

 

As of August 31, 2010, third-party Twitter applications are required to use OAuth, an authentication method that does not require users to enter their password into the authenticating application. Previously, Sony VAIO VGN-SR19XN Battery

the OAuth authentication method was optional, it is now compulsory and the user-name/password authentication method has been made redundant and is no longer functional. Twitter stated that the move to OAuth will mean “increased security and a better experience.”[83] Sony VAIO VGN-SR21M/S Battery

 

Demographics

Note: Visitor age 15+, home and work locations. Excludes visitation from public computers such as Internet cafes or access from mobile phones or PDAs.

Twitter is mainly used by older adults who might not have used other social sites before Twitter, said Jeremiah Owyang, an industry analyst studying social media. “Adults are just catching up to what teens have been doing for years,” he said.[86] According to comScore only eleven percent of Twitter’s users are aged twelve to seventeen.[86] comScore attributes this to Twitter’s “early adopter period” when the social network first gained popularity in business settings and news outlets attracting primarily older users. However, comScore as of late, has stated that Twitter has begun to “filter more into the mainstream”, and “along with it came a culture of celebrity as Shaq, Britney Spears and Ashton Kutcher joined the ranks of the Twitterati.”[87]

According to a study by Sysomos in June 2009, women make up a slightly larger Twitter demographic than men — fifty-three percent over forty-seven percent. It also stated that five percent of users accounted for seventy-five percent of all activity, and that New York has the most Twitter users.[8

 

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According to Quancast, twenty-seven million people in the US used Twitter as of September 3, 2009. Sixty-three percent of Twitter users are under thirty-five years old; sixty percent of Twitter users are Caucasian, but a higher than average (compared to other Internet properties) are African American (sixteen percent) and Hispanic (eleven percent); fifty-eight percent of Twitter users have a total household income of at least $60,000.[89] 8] Sony VAIO VGN-SR21RM/H Battery

 

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On September 7, 2011, Twitter announced that it has 100 million active users logging in at least once a month and 50 million active users every day.[90]

In an article published on January 6th, 2012, Twitter was confirmed to be the biggest social media network in Japan, with Facebook following closely in second. comScore confirmed this, stating that Japan is the only country in the world where Twitter leads Facebook.[91]

 

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Finances

 

Funding

 

 

Twitter’s San Francisco headquarters located at 795 Folsom St.

Twitter raised over US$57 million from venture capitalist growth funding, although exact numbers are not publicly disclosed. Twitter’s first A round of funding was for an undisclosed amount that is rumored to have been between $1 million and $5 million.[92] Its second B round of funding in 2008 was for $22 million[93] Sony VAIO VGN-SR21M/S Battery

and its third C round of funding in 2009 was for $35 million from Institutional Venture Partners and Benchmark Capital along with an undisclosed amount from other investors including Union Square Ventures, Spark Capital and Insight Venture Partners.[92] Twitter is backed by Union Square Ventures, Digital Garage, Spark Capital, and Bezos Expeditions.[94] Sony VAIO VGN-SR29VN Battery

 

In May 2008, The Industry Standard remarked that Twitter’s long-term viability is limited by a lack of revenue.[95] Twitter board member Todd Chaffee forecast that the company could profit from e-commerce, noting that users may want to buy items directly from Twitter since it already provides product recommendations and promotions.[96]

The company raised $200 million in new venture capital in December 2010, at a valuation of approximately $3.7 billion.[97] In March 2011, 35,000 Twitter shares sold for $34.50 each on Sharespost, an implied valuation of $7.8 billion.[98] In August, 2010 Twitter announced a “significant” investment lead by Digital Sky Technologies that, at $800 million, was reported to be the largest venture round in history.[99]

Twitter has been identified as a possible candidate for an initial public offering by 2013.[100]

In December 2011, the Saudi prince Alwaleed bin Talal invested $300 million in Twitter. The company was valued at $8.4 billion at the time.[101] Sony VAIO VGN-SR31M Battery

 

Revenue sources

In July 2009, some of Twitter’s revenue and user growth documents were published on TechCrunch after being illegally obtained by Hacker Croll. The documents projected 2009 revenues of $400,000 in the third quarter and $4 million in the fourth quarter along with 25 million users by the end of the year. The projections for the end of 2013 were $1.54 billion in revenue, $111 million in net earnings, and 1 billion users.[2Sony VAIO VGN-SR41M/P Battery

 

Sony VGP-BPS21A Battery] No information about how Twitter planned to achieve those numbers was published. In response, Twitter co-founder Biz Stone published a blog post suggesting the possibility of legal action against the hacker.[102] Sony VAIO VGN-SR41M/S Battery

 

On April 13, 2010, Twitter announced plans to offer paid advertising for companies that would be able to purchase “promoted tweets” to appear in selective search results on the Twitter website, similar to Google Adwords’ advertising model. As of April 13, Twitter announced it had already signed up a number of companies wishing to advertise including Sony Pictures, Red Bull, Best Buy, and Starbucks.[103][104] Sony VAIO VGN-SR51MF/P Battery

 

To continue their advertising campaign, Twitter announced on March 20th, 2012, that it would be bringing its promoted tweets to mobile devices. Twitter generated $139.5 million in advertising sales during 2011 and expects this number to grow 86.3% to $259.9 million in 2012. [105]

The company generated $45 million in annual revenue in 2010, Sony VAIO VGN-SR51MF/W Battery

after beginning sales midway through that year. The company operated at a loss through most of 2010. Revenues were forecast for $100 million to $110 million in 2011.[97] Users’ photos can generate royalty-free revenue for Twitter, with an agreement with WENN being announced in May 2011.[106] In June 2011, Twitter announced that it would offer small businesses a self serve advertising system.[107] Sony VAIO VGN-SR51MR Battery

 

Technology

 

Implementation

The Twitter Web interface uses the Ruby on Rails framework,[108] deployed on a performance enhanced Ruby Enterprise Edition implementation of Ruby.[109]

As of April 6, 2011, Twitter engineers confirmed they had switched away from their Ruby on Rails search-stack, to a Java server they call Blender.[110] Sony VGP-BPS13/B Battery

 

From spring 2007 to 2008 the messages were handled by a Ruby persistent queue server called Starling,[111] but since 2009 implementation has been gradually replaced with software written in Scala.[112] The service’s application programming interface (API) allows other web services and applications to integrate with Twitter.[113][114] Sony VGP-BPS13B/B Battery

 

Interface

On April 30, 2009, Twitter adjusted its web interface, adding a search bar and a sidebar of “trending topics” — the most common phrases appearing in messages. Biz Stone explains that all messages are instantly indexed and that “with this newly launched feature, Twitter has become something unexpectedly important – a discovery engine for finding out what is happening right now.”[115]

 

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In March 2012, Twitter became available in Arabic, Farsi, Hebrew and Urdu, the first right-to-left language versions of the site. About 13,000 volunteers helped with translating the menu options.[116]

 

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Outages

 

 

The Twitter fail whale error message.

When Twitter experiences an outage, users see the “fail whale” error message image created by Yiying Lu,[117] illustrating eight orange birds using a net to hoist a whale from the ocean captioned “Too many tweets! Please wait a moment and try again.”[118]

 

 

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Twitter had approximately ninety-eight percent uptime in 2007 (or about six full days of downtime).[119] The downtime was particularly noticeable during events popular with the technology industry such as the 2008 Macworld Conference & Expo keynote address.[120][121]

May 2008 – Twitter’s new engineering team made architectural changes to deal with the scale of growth. Stability issues resulted in down time or temporary feature removal. Sony VGP-BPS13A/B Battery

 

August 2008 – Twitter withdrew free SMS services from users in the United Kingdom[122] and for approximately five months instant messaging support via a XMPP bot was listed as being “temporarily unavailable”.[123]

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October 10, 2008 – Twitter’s status blog announced that instant messaging (IM) service was no longer a temporary outage and needed to be revamped. It was announced that Twitter aims to return its IM service pending necessary major work.[124] Sony VGP-BPS13 Batterty

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June 12, 2009 – In what was called a potential “Twitpocalypse”, the unique numerical identifier associated with each tweet exceeded the limit of 32-bit signed integers (2,147,483,647 total messages).[125] While Twitter itself was not affected, some third-party clients could no longer access recent tweets. Patches were quickly released, though some iPhone applications had to wait for approval from the App Store.[126] Akku Sony VAIO VGN-SR19VN

 

June 25, 2009 – Twitter crashed at least once and ran very slowly for some time after It recorded over 50,000 tweets about Michael Jackson’s death in just one hour.[127] Michael Jackson was ranked on seven of the top ten trending topics. Akku Sony VAIO VGN-SR21M/S

 

August 6, 2009 – Twitter and Facebook suffered from a denial-of-service attack, causing the Twitter website to go offline for several hours.[128] It was later confirmed that the attacks were directed at one pro-Georgian user around the anniversary of the 2008 South Ossetia War, rather than the sites themselves.[129] Akku Sony VAIO VGN-SR29VN/S

 

September 22, 2009 – The identifier exceeded the limit for 32-bit unsigned integers (4,294,967,296 total messages) again breaking some third-party clients.[130]

December 17, 2009 – A hacking attack replaced the website’s welcoming screen with an image of a green flag and the caption “This site has been hacked by Iranian Cyber Army” for nearly an hour. No connection between the hackers and Iran has been established.[131] Akku Sony VAIO VGN-SR31M/S

 

June–July 2010 – Twitter had a very high service rejection rate (10–20%) during the 2010 FIFA World Cup period, also, the response latency increased substantially.[132]

November 2010 – A number of accounts encountered a fault that resulted in them seeing the “fail whale” when they tried to login to their accounts. The accounts themselves were not locked out as account holders could still see their “mentions” page, and post from there, but the timeline and a number of other features were unavailable during this outage.

 

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Privacy and security

Twitter messages are public but users can also send private messages.[133] Twitter collects personally identifiable information about its users and shares it with third parties. The service reserves the right to sell this information as an asset if the company changes hands.[134]

 

Akku Sony VAIO VGN-SR51MR While Twitter displays no advertising, advertisers can target users based on their history of tweets and may quote tweets in ads[135] directed specifically to the user.

A security vulnerability was reported on April 7, 2007, by Nitesh Dhanjani and Rujith. Since Twitter used the phone number of the sender of an SMS message as authentication, malicious users could update someone else’s status page by using SMS spoofing.[136] Akku Sony VAIO VGN-SR41M/P

The vulnerability could be used if the spoofer knew the phone number registered to their victim’s account. Within a few weeks of this discovery Twitter introduced an optional personal identification number (PIN) that its users could use to authenticate their SMS-originating messages.[137] Akku Sony VAIO VGN-SR41M/S

 

On January 5, 2009, 33 high-profile Twitter accounts were compromised after a Twitter administrator’s password was guessed by a dictionary attack.[138] Falsified tweets — including sexually explicit and drug-related messages — were sent from these accounts.[139] Akku Sony VAIO VGN-SR51MF/P

Twitter launched the beta version of their “Verified Accounts” service on June 11, 2009, allowing famous or notable people to announce their Twitter account name. The home pages of these accounts display a badge indicating their status.[140] Akku Sony VAIO VGN-SR51MF/P

 

In May 2010, a bug was discovered by İnci Sözlük, involving users that allowed Twitter users to force others to follow them without the other users’ consent or knowledge. For example, comedian Conan O’Brien’s account, which had been set to follow only one person, was changed to receive nearly 200 malicious subscriptions.[141] Akku Sony VAIO VGN-FW11L

 

In response to Twitter’s security breaches, the Federal Trade Commission brought charges against the service which were settled on June 24, 2010. This was the first time the FTC had taken action against a social network for security lapses. The settlement requires Twitter to take a number of steps to secure users’ private information, including maintenance of a “comprehensive information security program” to be independently audited biannually.[142] Akku Sony VAIO VGN-FW11S

 

On December 14, 2010, the United States Department of Justice issued a subpoena directing Twitter to provide information for accounts registered to or associated with WikiLeaks.[143] Twitter decided to notify its users and said in a statement, “…it’s our policy to notify users about law enforcement and governmental requests for their information, unless we are prevented by law from doing so”.[133]

 

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A “MouseOver” exploit occurred on September 21, 2010, when an XSS Worm became active on Twitter. When an account user held the mouse cursor over blacked out parts of a tweet, the worm within the script would automatically open links and re-post itself on the reader’s account.[144] The exploit was then re-used to post pop-up ads and links to pornographic sites.

 

Akku Sony VAIO VGN-FW54MThe origin is unclear but Pearce H. Delphin (known on Twitter as @zzap) and a Scandinavian developer, Magnus Holm, both claim to have modified the exploit of a user, possibly Masato Kinugawa, who was using it to create coloured Tweets.[145] Kinugawa, a Japanese developer, reported the XSS vulnerability to Twitter on August 14. Later, when he found it was exploitable again, he created the account ‘RainbowTwtr’ Akku Sony VAIO VGN-FW11ZRU

 

Akku Sony VAIO VGN-FW51ZF/Hand used it to post coloured messages.[145] Delphin says he exposed the security flaw by tweeting a JavaScript function for “onMouseOver”,[145] and Holm later created and posted the XSS Worm that automatically re-tweeted itself.[144] Security firm Sophos reported that the virus was spread by people doing it for “fun and games”, but noted it could be exploited by cybercriminals.[144] Akku Sony VAIO VGN-FW11ZU

Twitter issued a statement on their status blog at 13:50 UTC that “The exploit is fully patched”.[144][146] Twitter representative Carolyn Penner said no charges would be pressed.[147

 

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In May 2011, a claimant known as "CTB" (subsequently identified as Ryan Giggs) in the case of CTB v Twitter Inc., Persons Unknown took legal action at the High Court of Justice in London against Twitter.,[148] requesting that Twitter release details of account holders. This followed gossip posted on Twitter about Giggs’ private life, causing conflict relating to privacy injunctions.[149][150] ] Akku Sony VAIO VGN-FW21J

Tony Wang, the head of Twitter in Europe, said that people who do “bad things” on the site would need to defend themselves under the laws of their own jurisdiction in the event of controversy, and that the site would hand over information about users to the authorities when it was legally required to do so.[151] Akku Sony VAIO VGN-FW3ZJ

He also suggested that Twitter would accede to a UK court order to divulge names of users responsible for “illegal activity” on the site.[152] Akku Sony VAIO VGN-FW41E/H

 

On May 29, 2011, it was reported that South Tyneside council in England had successfully taken legal action against Twitter in a court in California, which forced Twitter to reveal the details of five user accounts. The council was trying to discover the identity of a blogger called “Mr Monkey”[153] who allegedly posted libellous statements about three local councillors.[154]

 

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On January 23, 2012, it was reported that Twitter will be acquiring Dasient, a startup that offers malware protection for businesses. Twitter hopes that Dasient will help remove hateful advertisers on the website. [155] Akku Sony VAIO VGN-FW41J/H

 

On January 26, 2012, Twitter began offering a feature which would allow tweets to be removed selectively by country. Twitter cited France and Germany as examples, where pro-Nazi content is illegal. Previously, deleted tweets were removed in all countries.[156][157] Akku Sony VAIO VGN-FW41M/H

On February 20, 2012, a third-party public-key encryption app (written in Python and partially funded by a grant from the Shuttleworth Foundation[158]) for direct messaging in Twitter, CrypTweet, was released.[159] Akku Sony VAIO VGN-FWZTJ/H

 

Open source

Twitter released several open source projects developed while overcoming technical challenges of their service.[160] Notable projects are the Gizzard Scala framework for creating distributed datastores and the distributed graph database FlockDB. Sony VGP-BPS13 Battery

URL shortener

t.co is a URL shortening service created by Twitter.[68] It is only available for links posted to Twitter and not available for general use.[68] All links posted to Twitter use a t.co wrapper.[161] Twitter hopes that the service will be able to protect users from malicious sites,[68] and will use it to track clicks on links within tweets.[68][162] Sony VGP-BPS13A/B Battery

 

Having previously used the services of third parties TinyURL and bit.ly,[163] Twitter began experimenting with its own URL shortening service for direct messages in March 2010 using the twt.tl domain,[161] before it purchased the t.co domain. The service was tested on the main site using the accounts @TwitterAPI, @rsarver and @raffi.[161] Sony VGP-BPS13A/S Battery

 

On September 2, 2010, an email from Twitter to users said they would be expanding the roll-out of the service to users. On June 7, 2011, Twitter announced that it was rolling out the feature.[164] Sony VGP-BPS13B/B Battery

 

Integrated photo-sharing service

On June 1, 2011, Twitter announced its own integrated photo-sharing service that enables users to upload a photo and attach it to a Tweet right from Twitter.com.[165] Users now also have the ability to add pictures to Twitter’s search by adding hashtags to the tweet.[166] Twitter also plans to provide photo galleries designed to gather and syndicate all photos that a user has uploaded on Twitter and third-party services such as TwitPic.[166] Sony VGP-BPS13/S Battery

Use and social impact

 

 

 

Dorsey (left) said after a Twitter Town Hall held in July 2011, that Twitter received over 110,000 #AskObama tweets.[167]

Main article: Twitter usage

See also: Censorship of Twitter

Twitter has been used for a variety of purposes in many industries and scenarios. For example, it has been used to organize protests, sometimes referred to as “Twitter Revolutions”, which include the 2011 Egyptian revolution, 2010–2011 Tunisian protests, 2009–2010 Iranian election protests, and 2009 Moldova civil unrest.[168] Sony VGP-BPS13B/Q Battery

 

The governments of Iran and Egypt blocked the service in retaliation.[169][170] The service is also used as a form of civil disobedience: in 2010, users expressed outrage over the Twitter Joke Trial by making obvious jokes about terrorism;[171] and in the British privacy injunction debate in the same country a year later, Sony VGP-BPS13/Q Battery

where several celebrities who had taken out anonymised injunctions, most notably the Manchester United player Ryan Giggs, were identified by thousands of users in protest to traditional journalism being censored.[172]

Twitter is also increasingly used for making TV more interactive and social.[173] This effect is sometimes referred to as the “virtual watercooler” or social television — the practice has been called “chatterboxing”.[174] Twitter has been successfully used to encourage people to watch live TV events, such as the Oscars, the Super Bowl[175] and the MTV Video Music Awards; however this strategy has proven less effective with regularly scheduled TV shows.[176] Such direct cross-promotions have been banned from French television due to regulations against secret advertising.[177]

In May 2008, The Wall Street Journal wrote that social networking services such as Twitter “elicit mixed feelings in the technology-savvy people who have been their early adopters. Fans say they are a good way to keep in touch with busy friends. But some users are starting to feel ‘too’ connected, as they grapple with check-in messages at odd hours, higher cellphone bills and the need to tell acquaintances to stop announcing what they’re having for dinner.”[178]

 

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Tech writer Bruce Sterling opined in 2007 that using Twitter for “literate communication” is “about as likely as firing up a CB radio and hearing some guy recite the Iliad”.[179] In September 2008, the journalist Clive Thompson mused in a The New York Times Magazine editorial that the service had expanded narcissism into “a new, supermetabolic extreme—the ultimate expression of a generation of celebrity-addled youths who believe their every utterance is fascinating and ought to be shared with the world.”[180] Conversely, Sony VGP-BPS13/B Battery

 

Sony VGN-SR45H/N Battery Vancouver Sun columnist Steve Dotto opined that part of Twitter’s appeal is the challenge of trying to publish such messages in tight constraints,[181] and Jonathan Zittrain, professor of Internet law at Harvard Law School, said that “the qualities that make Twitter seem inane and half-baked are what makes it so powerful”.[182] Sony VGP-BPS13B/S Battery

 

In 2009, Nielsen Online reported that Twitter has a user retention rate of forty percent. Many people stop using the service after a month, therefore the site may potentially reach only about ten percent of all Internet users.[183] In 2009, Twitter won the “Breakout of the Year” Webby Award.[184][185] During a February 2009 discussion on National Public Radio’s Weekend Edition, the journalist Daniel Schorr stated that Twitter accounts of events lacked rigorous fact-checking and other editorial improvements. In response, Sony VGP-BPS13A Battery

Andy Carvin gave Schorr two examples of breaking news stories that played out on Twitter and said users wanted first-hand accounts and sometimes debunked stories.[186] Time magazine acknowledged its growing level of influence in its 2010 Time 100; to determine the influence of people, it used a formula based on famous social networking sites, Sony VGP-BPS13B Battery

 

Sony VGN-SR45H/B BatteryTwitter and Facebook. The list ranges from Barack Obama and Oprah Winfrey to Lady Gaga and Ashton Kutcher.[187]

After claims in the media that the hashtags #wikileaks and #occupywallstreet were being censored because they did not show up on the site’s list of trending topics, Twitter responded by stating that it does not censor hashtags unless they contain obscenities.[188][189][190]

 

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Reception

 

In 2006, when Twitter launched under the name “Twttr”, Michael Arrington of TechCrunch commented that although he liked the service, he also noted that he felt uncomfortable with the fact that every user’s Twitter page is available to the public.[191]

Change of focus

 

 

The mobile version of twitter.com

Twitter emphasized its news and information-network strategy in November 2009 by changing the question asked to users for status updates from “What are you doing?” to “What’s happening?”[192][193] Entertainment Weekly put it on its end-of-the-decade, “best-of” list, saying, “Limiting yourself to 140 characters—the maximum for messages on this diabolically addictive social-networking tool—is easy.”[194] Sony VGP-BPS21A Battery

 

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On November 22, 2010, Biz Stone, a cofounder of the company, expressed for the first time the idea of a Twitter news network,[195] a concept of a wire-like news service he has been working on for years.[196] Sony VGP-BPS21 Battery

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Financial crisis and The 2007–2012 global financial crisis


Financial crisis and The 2007–2012 global financial crisis

The term financial crisis is applied broadly to a variety of situations in which some financial institutions or assets suddenly lose a large part of their value[1]. In the 19th and early 20th centuries, many financial crises were associated with banking panics, Sony Vaio VGN-NR31E/S Battery

 

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and many recessions coincided with these panics. Other situations that are often called financial crises include stock market crashes and the bursting of other financial bubbles, currency crises, and sovereign defaults.[2][3] Financial crises directly result in a loss of paper wealth; they do not directly result in changes in the real economy unless a recession or depression follows.

 

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Many economists have offered theories about how financial crises develop and how they could be prevented. There is little consensus, however, and financial crises are still a regular occurrence around the world.

 

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When a bank suffers a sudden rush of withdrawals by depositors, this is called a bank run. Since banks lend out most of the cash they receive in deposits (see fractional-reserve banking), it is difficult for them to quickly pay back all deposits if these are suddenly demanded, so a run may leave the bank in bankruptcy,

 

Sony Vaio VGN-NR31SR/S Battery causing many depositors to lose their savings unless they are covered by deposit insurance. A situation in which bank runs are widespread is called a systemic banking crisis or just a banking panic. A situation without widespread bank runs, but in which banks are reluctant to lend,

 

Sony Vaio VGN-NR31S/S Batterybecause they worry that they have insufficient funds available, is often called a credit crunch. In this way, the banks become an accelerator of a financial crisis.[4]

Examples of bank runs include the run on the Bank of the United States in 1931 and the run on Northern Rock in 2007. The collapse of Bear Stearns in 2008 has also sometimes been called a bank run, even though Bear Stearns was an investment bank rather than a commercial bank.

 

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Banking crises generally occur after periods of risky lending and heightened loan defaults. [5] The U.S. savings and loan crisis of the 1980s led to a credit crunch which is seen as a major factor in the U.S. recession of 1990–91.

 

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Speculative bubbles and crashes

Main articles: Stock market crash and Bubble (economics)

Economists say that a financial asset (stock, for example) exhibits a bubble when its price exceeds the present value of the future income (such as interest or dividends) that would be received by owning it to maturity.[6] Sony Vaio VGN-NR31ER/S BatteryIf most market participants buy the asset primarily in hopes of selling it later at a higher price, instead of buying it for the income it will generate, this could be evidence that a bubble is present. If there is a bubble, Sony VAIO PCG-3F1L Battery

there is also a risk of a crash in asset prices: market participants will go on buying only as long as they expect others to buy, and when many decide to sell the price will fall. However, it is difficult to tell in practice whether an asset’s price actually equals its fundamental value, so it is hard to detect bubbles reliably. Some economists insist that bubbles never or almost never occur.[7] Sony VAIO PCG-3F2L Battery

Black Friday, 9 May 1873, Vienna Stock Exchange. The Panic of 1873 and Long Depression followed.

Well-known examples of bubbles (or purported bubbles) and crashes in stock prices and other asset prices include the Dutch tulip mania, the Wall Street Crash of 1929, the Japanese property bubble of the 1980s, the crash of the dot-com bubble in 2000–2001, and the now-deflating United States housing bubble.[5][8][9] Sony VAIO PCG-3F3L Battery

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International financial crises

Main articles: Currency crisis and Sovereign default

When a country that maintains a fixed exchange rate is suddenly forced to devalue its currency because of a speculative attack, this is called a currency crisis or balance of payments crisis. When a country fails to pay back its sovereign debt, Sony VAIO PCG-3J1L Battery

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this is called a sovereign default. While devaluation and default could both be voluntary decisions of the government, they are often perceived to be the involuntary results of a change in investor sentiment that leads to a sudden stop in capital inflows or a sudden increase in capital flight.

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Several currencies that formed part of the European Exchange Rate Mechanism suffered crises in 1992–93 and were forced to devalue or withdraw from the mechanism. Another round of currency crises took place in Asia in 1997–98. Many Latin American countries defaulted on their debt in the early 1980s. The 1998 Russian financial crisis resulted in a devaluation of the ruble and default on Russian government bonds.

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Wider economic crises

Main articles: Recession and Depression (economics)

Negative GDP growth lasting two or more quarters is called a recession. An especially prolonged recession may be called a depression, while a long period of slow but not necessarily negative growth is sometimes called economic stagnation. Sony VAIO PCG-5P2L Battery

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Since these phenomena affect much more than the financial system they are not usually considered financial crises as such though there are clearly links between the two.

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Declining consumer spendings.

Some economists argue that many recessions have been caused in large part by financial crises. One important example is the Great Depression, which was preceded in many countries by bank runs and stock market crashes. Sony VAIO PCG-5R1L Battery

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The subprime mortgage crisis and the bursting of other real estate bubbles around the world also led to recession in the U.S. and a number of other countries in late 2008 and 2009.

Some economists argue that financial crises are caused by recessions instead of the other way around, and that even where a financial crisis is the initial shock that sets off a recession, other factors may be more important in prolonging the recession. In particular,Sony VAIO PCG-5S1L Battery

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Milton Friedman and Anna Schwartz argued that the initial economic decline associated with the crash of 1929 and the bank panics of the 1930s would not have turned into a prolonged depression if it had not been reinforced by monetary policy mistakes on the part of the Federal Reserve[10], a position supported by Ben Bernanke.[11] Sony VAIO PCG-3H2L Battery

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Causes and consequences of financial crises

Strategic complementarities in financial markets

Main articles: Strategic complementarity and Self-fulfilling prophecy

It is often observed that successful investment requires each investor in a financial market to guess what other investors will do. George Soros has called this need to guess the intentions of others ‘reflexivity’.[12] Sony VAIO PCG-3H4L Battery

Similarly, John Maynard Keynes compared financial markets to a beauty contest game in which each participant tries to predict which model other participants will consider most beautiful.[13] Circularity and self-fulfilling prophecies may be exaggerated when reliable information is not available because of opaque disclosures or a lack of disclosure.[14]Sony VAIO PCG-3B1L Battery

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Furthermore, in many cases investors have incentives to coordinate their choices. For example, someone who thinks other investors want to buy lots of Japanese yen may expect the yen to rise in value, and therefore has an incentive to buy yen too. Likewise, a depositor in IndyMac Bank who expects other depositors to withdraw their funds may expect the bank to fail, Sony VAIO PCG-7153L Battery

Sony VAIO PCG-7151L Battery and therefore has an incentive to withdraw too. Economists call an incentive to mimic the strategies of others strategic complementarity.[15]

It has been argued that if people or firms have a sufficiently strong incentive to do the same thing they expect others to do, then self-fulfilling prophecies may occur.[16] For example, if investors expect the value of the yen to rise, this may cause its value to rise;

Sony VAIO PCG-7148L Battery if depositors expect a bank to fail this may cause it to fail.[17] Therefore, financial crises are sometimes viewed as a vicious circle in which investors shun some institution or asset because they expect others to do so.[18] Sony VAIO PCG-7154L Battery

Leverage

Main article: Leverage (finance)

Leverage, which means borrowing to finance investments, is frequently cited as a contributor to financial crises[14] . When a financial institution (or an individual) only invests its own money, it can, in the very worst case,

Sony VAIO PCG-7184L Battery lose its own money. But when it borrows in order to invest more, it can potentially earn more from its investment, but it can also lose more than all it has. Therefore leverage magnifies the potential returns from investment, but also creates a risk of bankruptcy.

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Since bankruptcy means that a firm fails to honor all its promised payments to other firms, it may spread financial troubles from one firm to another (see ‘Contagion’ below).

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The average degree of leverage in the economy often rises prior to a financial crisis[citation needed]. For example, borrowing to finance investment in the stock market (“margin buying”) became increasingly common prior to the Wall Street Crash of 1929.Sony VAIO PCG-7161L Battery

In addition, some scholars have argued that financial institutions can contribute to fragility by hiding leverage, and thereby contributing to underpricing of risk.[14]

Asset-liability mismatch

Main article: Asset-liability mismatch

Another factor believed to contribute to financial crises is asset-liability mismatch, a situation in which the risks associated with an institution’s debts and assets are not appropriately aligned. For example,

Sony VAIO PCG-7181L Battery commercial banks offer deposit accounts which can be withdrawn at any time and they use the proceeds to make long-term loans to businesses and homeowners. The mismatch between the banks’ short-term liabilities (its deposits) and its long-term assets (its loans) is seen as one of the reasons bank runs occur (when depositors panic and decide to withdraw their funds more quickly than the bank can get back the proceeds of its loans).[17]

Sony VAIO PCG-7173L BatteryLikewise, Bear Stearns failed in 2007–08 because it was unable to renew the short-term debt it used to finance long-term investments in mortgage securities.

In an international context, many emerging market governments are unable to sell bonds denominated in their own currencies,

Sony VAIO PCG-7171L Batteryand therefore sell bonds denominated in US dollars instead. This generates a mismatch between the currency denomination of their liabilities (their bonds) and their assets (their local tax revenues), so that they run a risk of sovereign default due to fluctuations in exchange rates.[19] Sony VAIO PCG-7162L Battery

Uncertainty and herd behavior

Main articles: Economic psychology and Herd behavior

Many analyses of financial crises emphasize the role of investment mistakes caused by lack of knowledge or the imperfections of human reasoning. Behavioral finance studies errors in economic and quantitative reasoning. Psychologist Torbjorn K A Eliazonhas also analyzed failures of economic reasoning in his concept of ‘œcopathy’.[20] Sony  VAIO VGN-FW21E Battery

Historians, notably Charles P. Kindleberger, have pointed out that crises often follow soon after major financial or technical innovations that present investors with new types of financial opportunities, which he called “displacements” of investors’ expectations.[21Sony  VAIO VGN-FW21I Battery

 

][22] Early examples include the South Sea Bubble and Mississippi Bubble of 1720, which occurred when the notion of investment in shares of company stock was itself new and unfamiliar,[23] and the Crash of 1929, which followed the introduction of new electrical and transportation technologies.[2Sony  VAIO VGN-FW21L Battery

4] More recently, many financial crises followed changes in the investment environment brought about by financial deregulation, and the crash of the dot com bubble in 2001 arguably began with “irrational exuberance” about Internet technology.[25]

 

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Unfamiliarity with recent technical and financial innovations may help explain how investors sometimes grossly overestimate asset values. Also, if the first investors in a new class of assets (for example, stock in “dot com” companies) profit from rising asset values as other investors learn about the innovation (in our example, Sony  VAIO VGN-FW21Z Battery

  • · 

 

Sony VAIO VGN-FW51ZF/H Battery as others learn about the potential of the Internet), then still more others may follow their example, driving the price even higher as they rush to buy in hopes of similar profits. If such “herd behavior” causes prices to spiral up far above the true value of the assets, a crash may become inevitable.

Sony VAIO VGN-FW51MF/H BatteryIf for any reason the price briefly falls, so that investors realize that further gains are not assured, then the spiral may go into reverse, with price decreases causing a rush of sales, reinforcing the decrease in prices. Sony  VAIO VGN-FW21M Battery

  • · 

 

Regulatory failures

Main articles: Financial regulation and Bank regulation

Governments have attempted to eliminate or mitigate financial crises by regulating the financial sector. One major goal of regulation is transparency:

 

Sony VAIO VGN-FW51 Battery making institutions’ financial situations publicly known by requiring regular reporting under standardized accounting procedures. Another goal of regulation is making sure institutions have sufficient assets to meet their contractual obligations, through reserve requirements, capital requirements, and other limits on leverage. Sony  VAIO VGN-FW31M Battery

  • ·

Some financial crises have been blamed on insufficient regulation, and have led to changes in regulation in order to avoid a repeat. For example, the Managing Director of the International Monetary Fund,

 

Sony VAIO VGN-FW4ZTJ/H Dominique Strauss-Kahn, has blamed the financial crisis of 2008 on ‘regulatory failure to guard against excessive risk-taking in the financial system, especially in the US’.[26] Likewise, the New York Times singled out the deregulation of credit default swaps as a cause of the crisis.[27]

 

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However, excessive regulation has also been cited as a possible cause of financial crises. In particular, the Basel II Accord has been criticized for requiring banks to increase their capital when risks rise, which might cause them to decrease lending precisely when capital is scarce, potentially aggravating a financial crisis.[28] Sony  VAIO VGN-FW31J Battery

International regulatory convergence has been interpreted in terms of regulatory herding, deepening market herding (discussed above) and so increasing systemic risk.[29] From this perspective, maintaining diverse regulatory regimes would be a safeguard. Sony VAIO VGN-FW11ZRU Battery

Fraud

Main articles: Ponzi scheme and Securities fraud

Fraud has played a role in the collapse of some financial institutions, when companies have attracted depositors with misleading claims about their investment strategies, or have embezzled the resulting income.

 

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Examples include Charles Ponzi’s scam in early 20th century Boston, the collapse of the MMM investment fund in Russia in 1994, the scams that led to the Albanian Lottery Uprising of 1997, and the collapse of Madoff Investment Securities in 2008.

 

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Many rogue traders that have caused large losses at financial institutions have been accused of acting fraudulently in order to hide their trades. Fraud in mortgage financing has also been cited as one possible cause of the 2008 subprime mortgage crisis; government officials stated on September 23,

 

Sony VAIO VGN-FW21J Battery2008 that the FBI was looking into possible fraud by mortgage financing companies Fannie Mae and Freddie Mac, Lehman Brothers, and insurer American International Group.[30] Likewise it has been argued that many financial companies failed in the recent crisis because their managers failed to carry out their fiduciary duties.[31] Sony VAIO VGN-FW11ZU Battery

Contagion

Main articles: Financial contagion and Systemic risk

Contagion refers to the idea that financial crises may spread from one institution to another, as when a bank run spreads from a few banks to many others, or from one country to another, as when currency crises, sovereign defaults, Sony VAIO VGN-FW21ER Battery

or stock market crashes spread across countries. When the failure of one particular financial institution threatens the stability of many other institutions, this is called systemic risk.[32]

 

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One widely-cited example of contagion was the spread of the Thai crisis in 1997 to other countries like South Korea. However, economists often debate whether observing crises in many countries around the same time is truly caused by contagion from one market to another, or whether it is instead caused by similar underlying problems that would have affected each country individually even in the absence of international linkages.

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Recessionary effects

Some financial crises have little effect outside of the financial sector, like the Wall Street crash of 1987, but other crises are believed to have played a role in decreasing growth in the rest of the economy. There are many theories why a financial crisis could have a recessionary effect on the rest of the economy.

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These theoretical ideas include the ‘financial accelerator’, ‘flight to quality’ and ‘flight to liquidity’, and the Kiyotaki-Moore model. Some ‘third generation’ models of currency crises explore how currency crises and banking crises together can cause recessions.[33]SONY VGN-FW41E/H BATTERY

Theories of financial crises

Austrian theories

Main article: Austrian business cycle theory

Austrian School economists have had a business cycle theory ever since Ludwig Von Mises published a treatise on money and banking in 1912[34]. This theory goes back to debates of the Currency School and Banking School, Sony VAIO VGN-NW20EF Battery

and it concerns the effects of the practice of fractional-reserve banking on the economy. It also has traditions back to the School of Salamanca. Its essential claim is that the creation of money and credit without the savings of real resources sets the economy on an unsustainable course in which entrepreneurs undertake too many projects which cannot be successfully completed without those resources.

Sony VAIO VGN-FW54M BatteryThe subsequent losses result in a swift reduction in the value of financial assets. In the ensuing banking crisis “money substitutes” shrink (unless supported by government bailouts); uncertainty about the solvency of banks leads depositors to redeem substitutes for base money which shrinks the money supply.[35]Sony VAIO VGN-NW24S Battery

 

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Since, in modern times, and especially since the creation of central banks, the banking system is integral to public finance, this business cycle is usually accompanied by a government debt crisis.

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Marxist theories

Main article: Crisis (Marxian)

Recurrent major depressions in the world economy at the pace of 20 and 50 years (often referred to as the business cycle) have been the subject of studies since Jean Charles Léonard de Sismondi (1773–1842) provided the first theory of crisis in a critique of classical political economy’s assumption of equilibrium between supply and demand.Sony VAIO VGN-NW26M Battery

 

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Developing an economic crisis theory become the central recurring concept throughout Karl Marx’s mature work. Marx’s law of the tendency for the rate of profit to fall borrowed many features of the presentation of John Stuart Mill’s discussion Of the Tendency of Profits to a Minimum (Principles of Political Economy Book IV Chapter IV). Sony VAIO VGN-NW20ZF Battery

 

Sony VAIO VGN-FW54E Battery The theory is a corrollary of the Tendency towards the Centralization of Profits.

In a capitalist system, successfully-operating businesses return less money to their workers (in the form of wages) than the value of the goods produced by those workers (i.e. the amount of money the products are sold for). This profit first goes towards covering the initial investment in the business. In the long-run, however, when one considers the combined economic activity of all successfully-operating business,

 

Sony VAIO VGN-FW46Z Battery it is clear that less money (in the form of wages) is being returned to the mass of the population (the workers) than is available to them to buy all of these goods being produced. Furthermore, the expansion of businesses in the process of competing for markets leads to an abundance of goods and a general fall in their prices, further exacerbating the tendency for the rate of profit to fall.

 

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The viability of this theory depends upon two main factors: firstly, the degree to which profit is taxed by government and returned to the mass of people in the form of welfare, family benefits and health and education spending; and secondly, the proportion of the population who are workers rather than investors/business owners. Sony VAIO VGN-NW20SF Battery

 

Sony VAIO VGN-NW26JG Battery Given the extraordinary capital expenditure required to enter modern economic sectors like airline transport, the military industry, or chemical production, these sectors are extremely difficult for new businesses to enter and are being concentrated in fewer and fewer hands.

 

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Empirical and econometric research continue especially in the world systems theory and in the debate about Nikolai Kondratiev and the so-called 50-years Kondratiev waves. Major figures of world systems theory, like Andre Gunder Frank and Immanuel Wallerstein, consistently warned about the crash that the world economy is now facing[citation needed]. Sony VAIO VGN-NW21MF/P Battery

World systems scholars and Kondratiev cycle researchers always implied that Washington Consensus oriented economists never understood the dangers and perils, which leading industrial nations will be facing and are now facing at the end of the long economic cycle which began after the oil crisis of 1973.

 

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Minsky’s theory

Hyman Minsky has proposed a post-Keynesian explanation that is most applicable to a closed economy. He theorized that financial fragility is a typical feature of any capitalist economy. High fragility leads to a higher risk of a financial crisis. To facilitate his analysis, Minsky defines three approaches to financing firms may choose, according to their tolerance of risk. They are hedge finance, speculative finance, and Ponzi finance. Ponzi finance leads to the most fragility. Sony VAIO VGN-NW20EF/P Battery

for hedge finance, income flows are expected to meet financial obligations in every period, including both the principal and the interest on loans.

for speculative finance, a firm must roll over debt because income flows are expected to only cover interest costs. None of the principal is paid off.

 

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for Ponzi finance, expected income flows will not even cover interest cost, so the firm must borrow more or sell off assets simply to service its debt. The hope is that either the market value of assets or income will rise enough to pay off interest and principal.

 

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Financial fragility levels move together with the business cycle. After a recession, firms have lost much financing and choose only hedge, the safest. As the economy grows and expected profits rise, firms tend to believe that they can allow themselves to take on speculative financing. In this case,

 

Sony VAIO VGN-NW24EG Battery they know that profits will not cover all the interest all the time. Firms, however, believe that profits will rise and the loans will eventually be repaid without much trouble. More loans lead to more investment, and the economy grows further. Sony VAIO VGN-NW20EF/w Battery

Then lenders also start believing that they will get back all the money they lend. Therefore, they are ready to lend to firms without full guarantees of success.

 

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Lenders know that such firms will have problems repaying. Still, they believe these firms will refinance from elsewhere as their expected profits rise. This is Ponzi financing. In this way, the economy has taken on much risky credit. Now it is only a question of time before some big firm actually defaults.

 

Sony VAIO VGN-FW56E BatteryLenders understand the actual risks in the economy and stop giving credit so easily. Refinancing becomes impossible for many, and more firms default. If no new money comes into the economy to allow the refinancing process, a real economic crisis begins. During the recession, firms start to hedge again, and the cycle is closed. Sony VAIO VGN-NW20EF/S Battery

Coordination games

Main article: Coordination game

Mathematical approaches to modeling financial crises have emphasized that there is often positive feedback[36] between market participants’ decisions (see strategic complementarity).[37] Positive feedback implies that there may be dramatic changes in asset values in response to small changes in economic fundamentals.

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For example, some models of currency crises (including that of Paul Krugman) imply that a fixed exchange rate may be stable for a long period of time, but will collapse suddenly in an avalanche of currency sales in response to a sufficient deterioration of government finances or underlying economic conditions.[38][39] Sony VAIO VGN-NW31EF Battery

According to some theories, positive feedback implies that the economy can have more than one equilibrium. There may be an equilibrium in which market participants invest heavily in asset markets because they expect assets to be valuable, but there may be another equilibrium where participants flee asset markets because they expect others to flee too.[4Sony VAIO VGN-NS10E/S Battery

0] This is the type of argument underlying Diamond and Dybvig’s model of bank runs, in which savers withdraw their assets from the bank because they expect others to withdraw too.[17] Likewise, in Obstfeld’s model of currency crises, when economic conditions are neither too bad nor too good, there are two possible outcomes: speculators may or may not decide to attack the currency depending on what they expect other speculators to do.[1Sony VAIO VGN-NS10J/S Battery

8]

Herding models and learning models

Main articles: Herd behavior and Adaptive expectations

A variety of models have been developed in which asset values may spiral excessively up or down as investors learn from each other.

 

Sony VAIO VGN-NS11ZR/S Battery In these models, asset purchases by a few agents encourage others to buy too, not because the true value of the asset increases when many buy (which is called “strategic complementarity”), but because investors come to believe the true asset value is high when they observe others buying.

 

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In “herding” models, it is assumed that investors are fully rational, but only have partial information about the economy. In these models, when a few investors buy some type of asset, this reveals that they have some positive information about that asset,

Sony VAIO VGN-NS11SR/S Battery which increases the rational incentive of others to buy the asset too. Even though this is a fully rational decision, it may sometimes lead to mistakenly high asset values (implying, eventually, a crash) since the first investors may, by chance, have been mistaken.

 

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In “adaptive learning” or “adaptive expectations” models, investors are assumed to be imperfectly rational, basing their reasoning only on recent experience. In such models, if the price of a given asset rises for some period of time, investors may begin to believe that its price always rises, which increases their tendency to buy and thus drives the price up further.

Sony VAIO VGN-NS11L/S BatteryLikewise, observing a few price decreases may give rise to a downward price spiral, so in models of this type large fluctuations in asset prices may occur. Agent-based models of financial markets often assume investors act on the basis of adaptive learning or adaptive expectations.

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History

The 2007–2012 global financial crisis, also known as the Global Financial Crisis and 2008 financial crisis, is considered by many economists to be the worst financial crisis since the Great Depression of the 1930s.[1]

                                                                  

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It resulted in the threat of total collapse from large financial institutions, the bailout of banks by national governments, and downturns in stock markets around the world. In many areas, the housing market also suffered, resulting in evictions, foreclosures and prolonged unemployment. The crisis played a significant role in the failure of key businesses, declines in consumer wealth estimated in trillions of US dollars,

Sony VAIO VGN-NS11E/S Battery and a downturn in economic activity leading to the 2008–2012 global recession and contributing to the European sovereign-debt crisis.[2][3] The active phase of the crisis, which manifested as a liquidity crisis, can be dated from August 7, 2007 when BNP Paribas terminated withdrawals from three hedge funds citing “a complete evaporation of liquidity”.[4] Sony VAIO VGN-NS10L/S Battery

The bursting of the U.S. housing bubble, which peaked in 2006,[5] caused the values of securities tied to U.S. real estate pricing to plummet, damaging financial institutions globally.[6][7] The financial crisis was triggered by a complex interplay of the overvaluation of bundled sub-prime mortgages,

 

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questionable trading practices on behalf of both buyers and sellers, and a lack of adequate capital holdings from banks and insurance companies to back the financial commitments they were making.[8][9][

 

Sony VGP-BPS21A/B Battery0] Questions regarding bank solvency, declines in credit availability and damaged investor confidence had an impact on global stock markets, where securities suffered large losses during 2008 and early 2009. Economies worldwide slowed during this period, as credit tightened and international trade declined.[11Sony VAIO VGN-SR11M Battery

 

Sony VGP-BPS21B Battery1] Governments and central banks responded with unprecedented fiscal stimulus, monetary policy expansion and institutional bailouts. Although there have been aftershocks, the financial crisis itself ended sometime between late-2008 and mid-2009.[12][13][1

 

Sony VGP-BPS21A Battery4] In the U.S., Congress passed the American Recovery and Reinvestment Act of 2009. In the EU, the UK responded with austerity measures of spending cuts and tax increases without export growth and it has since slid into a double-dip recession.[15][16]

 

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Many causes for the financial crisis have been suggested, with varying weight assigned by experts.[17] The U.S. Senate’s Levin–Coburn Report asserted that the crisis was the result of “high risk, complex financial products; undisclosed conflicts of interest; the failure of regulators, the credit rating agencies,

 

Sony VGP-BPS13B/Q Batteryand the market itself to rein in the excesses of Wall Street.”[18] Two factors that have been frequently cited include the liberal use of the Gaussian copula function and the failure to track data provenance.[1

 

Sony VGP-BPS13A/Q Battery9] The 1999 repeal of the Glass–Steagall Act effectively removed the separation between investment banks and depository banks in the United States.[20] Critics argued that credit rating agencies and investors failed to accurately price the risk involved with mortgage-related financial products, and that governments did not adjust their regulatory practices to address 21st-century financial markets.[21] Sony VAIO VGN-SR11MR Battery

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In response to the financial crisis, both market-based and regulatory solutions have been implemented or are under consideration.[22] Paul Krugman, author of End This Depression Now! (2012), argues that while current solutions have stabilized the world economy, the world economy will not improve unless it receives further stimulus. Sony VAIO VGN-SR19VN Battery

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[23] Buchanan, Gjerstad, and Smith argue that fiscal and monetary policy are ineffective, failing to reignite residential investment and construction as they have in past contractions. The current type of contraction requires balance sheet repair via currency depreciation and export-driven growth.

 

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Fiscal stimulus extends a current account deficit and retards export growth.[16][24] If the world economy does not improve, many economists fear sovereign default is a real possibility in several European countries and even the United States.[25] Sony VAIO VGN-SR19XN Battery

 

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The immediate cause or trigger of the crisis was the bursting of the United States housing bubble which peaked in approximately 2005–2006.[26][27] Already-rising default rates on “subprime” and adjustable-rate mortgages (ARM) began to increase quickly thereafter. As banks began to give out more loans to potential home owners, housing prices began to rise.

 

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Steadily decreasing interest rates backed by the U.S Federal Reserve from 1982 onward and large inflows of foreign funds created easy credit conditions for a number of years prior to the crisis, fueling a housing construction boom and encouraging debt-financed consumption.[28] Sony VAIO VGN-SR21M/S Battery

The combination of easy credit and money inflow contributed to the United States housing bubble. Loans of various types (e.g., mortgage, credit card, and auto) were easy to obtain and consumers assumed an unprecedented debt load.[29][30]

 

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As part of the housing and credit booms, the number of financial agreements called mortgage-backed securities (MBS) and collateralized debt obligations (CDO), which derived their value from mortgage payments and housing prices, greatly increased.[7]Sony VAIO VGN-SR21RM/H Battery

Such financial innovation enabled institutions and investors around the world to invest in the U.S. housing market. As housing prices declined, major global financial institutions that had borrowed and invested heavily in subprime MBS reported significant losses.[31] Sony VAIO VGN-SR21M/S Battery

Falling prices also resulted in homes worth less than the mortgage loan, providing a financial incentive to enter foreclosure. The ongoing foreclosure epidemic that began in late 2006 in the U.S. continues to drain wealth from consumers and erodes the financial strength of banking institutions.

 

Sony VAIO VGN-SR51MR Battery Defaults and losses on other loan types also increased significantly as the crisis expanded from the housing market to other parts of the economy. Total losses are estimated in the trillions of U.S. dollars globally.[31]

 

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Share in GDP of U.S. financial sector since 1860[32]

While the housing and credit bubbles were building, a series of factors caused the financial system to both expand and become increasingly fragile, a process called financialization. U.S. Government policy from the 1970s onward has emphasized deregulation to encourage business,

 

Sony VAIO VGN-SR51MF/P Batterywhich resulted in less oversight of activities and less disclosure of information about new activities undertaken by banks and other evolving financial institutions. Thus, policymakers did not immediately recognize the increasingly important role played by financial institutions such as investment banks and hedge funds,Sony VAIO VGN-SR29VN Battery

also known as the shadow banking system. Some experts believe these institutions had become as important as commercial (depository) banks in providing credit to the U.S. economy, but they were not subject to the same regulations.[33]

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These institutions, as well as certain regulated banks, had also assumed significant debt burdens while providing the loans described above and did not have a financial cushion sufficient to absorb large loan defaults or MBS losses.[34] Sony VAIO VGN-SR41M/P Battery

These losses impacted the ability of financial institutions to lend, slowing economic activity. Concerns regarding the stability of key financial institutions drove central banks to provide funds to encourage lending and restore faith in the commercial paper markets, which are integral to funding business operations. Sony VAIO VGN-SR31M Battery

Governments also bailed out key financial institutions and implemented economic stimulus programs, assuming significant additional financial commitments.

 

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The U.S. Financial Crisis Inquiry Commission reported its findings in January 2011. It concluded that “the crisis was avoidable and was caused by: Widespread failures in financial regulation, including the Federal Reserve’s failure to stem the tide of toxic mortgages; Sony Vaio VGN-SR49VN/H Battery

Dramatic breakdowns in corporate governance including too many financial firms acting recklessly and taking on too much risk; An explosive mix of excessive borrowing and risk by households and Wall Street that put the financial system on a collision course with crisis; Sony Vaio VGN-FW56Z Battery

Key policy makers ill prepared for the crisis, lacking a full understanding of the financial system they oversaw; and systemic breaches in accountability and ethics at all levels.”[35][36]

 

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Subprime lending

Main article: Subprime mortgage crisis

Intense competition between mortgage lenders for revenue and market share, and the limited supply of creditworthy borrowers, caused mortgage lenders to relax underwriting standards and originate riskier mortgages to less creditworthy borrowers.[

 

Sony Vaio VGN-SR59XG/H Battery7] Prior to 2003, when the mortgage securitization market was dominated by regulated and relatively conservative Government Sponsored Enterprises, GSEs policed mortgage originators and maintained relatively high underwriting standards.

Sony Vaio VGN-SR59VG/H Battery However, as market power shifted from securitizers to originators and as intense competition from private securitizers undermined GSE power, mortgage standards declined and risky loans proliferated.[7] The worst loans were originated in 2004–2007, the years of the most intense competition between securitizers and the lowest market share for the GSEs.

U.S. subprime lending expanded dramatically 2004–2006

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As well as easy credit conditions, there is evidence that competitive pressures contributed to an increase in the amount of subprime lending during the years preceding the crisis. Major U.S. investment banks and government sponsored enterprises like Fannie Mae played an important role in the expansion of lending, with GSEs eventually relaxing their standards to try to catch up with the private banks.[37][38]

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Subprime mortgages remained below 10% of all mortgage originations until 2004, when they spiked to nearly 20% and remained there through the 2005–2006 peak of the United States housing bubble.[39] Sony Vaio VGN-SR57S Battery

Some long-time critics of government and the GSEs, like American Enterprise Institute fellow Peter J. Wallison,[40] claim that the roots of the crisis can be traced directly to risky lending by government sponsored entities Fannie Mae and Freddie Mac. Sony Vaio VGN-SR57V Battery

Although Wallison’s claims have received widespread attention in the media and by policy makers, the majority report of the Financial Crisis Inquiry Commission, several studies by Federal Reserve economists, and the work of independent scholars suggest that Wallison’s claims are not supported by data.[7]

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In fact, the GSEs loans performed far better than loans securitized by private investment banks, and GSE loans performed better than some loans originated by institutions that held loans in their own portfolios.[7] Sony VPCF1 Battery

Wallison has been widely criticized for attempting to politicize the investigation of the Financial Crisis Inquiry Commission, and his critics include fellow Republican Commissioners.[41] Morgenson and Rosner also highlight the role of the GSEs in non-prime lending.[42] Others agree[43][44] and disagree.[45][46] Sony VPCF2 Battery

 

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On September 30, 1999, The New York Times reported that the Clinton Administration pushed for more lending to low and moderate income borrowers, while the mortgage industry sought guarantees for sub-prime loans: Sony VPCF11C4E/B Battery

 

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Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

 

Sony VPCF21Z1E/BI BatteryIn addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers… In moving, even tentatively, into this new area of lending, Sony VPCF11C5E Battery

 

Sony VPCF13M1E/H Battery Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980s.[47] Sony VPCF11D4E Battery

 

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In the early and mid-2000s (decade), the Bush administration called numerous times[48] for investigation into the safety and soundness of the GSEs and their swelling portfolio of subprime mortgages.

 

Sony VPCF12S1E/B BatteryOn September 10, 2003 the House Financial Services Committee held a hearing at the urging of the administration to assess safety and soundness issues and to review a recent report by the Office of Federal Housing Enterprise Oversight (OFHEO) that had uncovered accounting discrepancies within the two entities.[49] Sony VPCF11M1E/H Battery

 

Sony VPCF13Z8E/BI Battery The hearings never resulted in new legislation or formal investigation of Fannie Mae and Freddie Mac, as many of the committee members refused to accept the report and instead rebuked OFHEO for their attempt at regulation.[50] Sony VPCF11S1E/B Battery

 

Sony VPCF13Z8E Battery Some believe this was an early warning to the systemic risk that the growing market in subprime mortgages posed to the U.S. financial system that went unheeded.[51]

 

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A 2000 United States Department of the Treasury study of lending trends for 305 cities from 1993 to 1998 showed that $467 billion of mortgage lending was made by Community Reinvestment Act (CRA)-covered lenders into low and mid level income (LMI) borrowers and neighborhoods, representing 10% of all U.S. mortgage lending during the period. Sony VPCF115FG/B Battery

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The majority of these were prime loans. Sub-prime loans made by CRA-covered institutions constituted a 3% market share of LMI loans in 1998,[52] but in the run-up to the crisis, fully 25% of all sub-prime lending occurred at CRA-covered institutions and another 25% of sub-prime loans had some connection with CRA.[53] Sony VPCF22J1E Battery

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An analysis by the Federal Reserve Bank of Dallas in 2009, however, concluded unequivocally that the CRA was not responsible for the mortgage loan crisis, pointing out that CRA rules have been in place since 1995 whereas the poor lending emerged only a decade later.[54Sony VPCF22L1E Battery

 

] Furthermore, most sub-prime loans were not made to the LMI borrowers targeted by the CRA, especially in the years 2005–2006 leading up to the crisis. Nor did it find any evidence that lending under the CRA rules increased delinquency rates or that the CRA indirectly influenced independent mortgage lenders to ramp up sub-prime lending. Sony VPCF22M1E Battery

 

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Economist Paul Krugman argued in January 2010 that the simultaneous growth of the residential and commercial real estate pricing bubbles undermines the case made by those who argue that Fannie Mae, Freddie Mac, CRA or predatory lending were primary causes of the crisis. In other words, bubbles in both markets developed even though only the residential market was affected by these potential causes.[5Sony VPCF22S1E Battery

 

Sony VPCF13J0E/H Battery5] Others have pointed out that there were not enough of these loans made to cause a crisis of this magnitude. In an article in Portfolio Magazine, Michael Lewis spoke with one trader who noted that “There weren’t enough Americans with [bad] credit taking out [bad loans] to satisfy investors’ appetite for the end product.” Essentially, Sony VPCF22S8E Battery

 

Sony VPCF13E8E Battery investment banks and hedge funds used financial innovation to enable large wagers to be made, far beyond the actual value of the underlying mortgage loans, using derivatives called credit default swaps, collateralized debt obligations and synthetic CDOs.[56]

As of March 2011 the FDIC has had to pay out $9 billion to cover losses on bad loans at 165 failed financial institutions.[57

 

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Growth of the housing bubble

Main article: United States housing bubble

A graph showing the median and average sales prices of new homes sold in the United States between 1963 and 2008 (not adjusted for inflation)[58]

Between 1997 and 2006, the price of the typical American house increased by 124%.[59] During the two decades ending in 2001, the national median home price ranged from 2.9 to 3.1 times median household income. This ratio rose to 4.0 in 2004, and 4.6 in 2006.[6]Sony VPCF23M1E Battery

0] This housing bubble resulted in many homeowners refinancing their homes at lower interest rates, or financing consumer spending by taking out second mortgages secured by the price appreciation.

 

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In a Peabody Award winning program, NPR correspondents argued that a “Giant Pool of Money” (represented by $70 trillion in worldwide fixed income investments) sought higher yields than those offered by U.S. Treasury bonds early in the decade. This pool of money had roughly doubled in size from 2000 to 2007,

 

Sony VPCF12F4E/H Battery yet the supply of relatively safe, income generating investments had not grown as fast. Investment banks on Wall Street answered this demand with products such as the mortgage-backed security and the collateralized debt obligation that were assigned safe ratings by the credit rating agencies.[61]

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In effect, Wall Street connected this pool of money to the mortgage market in the U.S., with enormous fees accruing to those throughout the mortgage supply chain, from the mortgage broker selling the loans,

 

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to small banks that funded the brokers and the large investment banks behind them. By approximately 2003, the supply of mortgages originated at traditional lending standards had been exhausted, and continued strong demand began to drive down lending standards.[61]

 

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The collateralized debt obligation in particular enabled financial institutions to obtain investor funds to finance subprime and other lending, extending or increasing the housing bubble and generating large fees.

 

Sony VPCF11S1E BatteryThis essentially places cash payments from multiple mortgages or other debt obligations into a single pool from which specific securities draw in a specific sequence of priority. Those securities first in line received investment-grade ratings from rating agencies. Securities with lower priority had lower credit ratings but theoretically a higher rate of return on the amount invested.[62][63] Sony VPCF23Q1E Battery

By September 2008, average U.S. housing prices had declined by over 20% from their mid-2006 peak.[64][65] As prices declined, borrowers with adjustable-rate mortgages could not refinance to avoid the higher payments associated with rising interest rates and began to default. During 2007,

 

Sony VPCF24M1E Battery lenders began foreclosure proceedings on nearly 1.3 million properties, a 79% increase over 2006.[66] This increased to 2.3 million in 2008, an 81% increase vs. 2007.[67] By August 2008, 9.2% of all U.S. mortgages outstanding were either delinquent or in foreclosure.[68] By September 2009, this had risen to 14.4%.[69]Sony VPCF231S1E Battery

Easy credit conditions

Lower interest rates encouraged borrowing. From 2000 to 2003, the Federal Reserve lowered the federal funds rate target from 6.5% to 1.0%.[7Sony VPCF23S1E Battery

0] This was done to soften the effects of the collapse of the dot-com bubble and the September 2001 terrorist attacks, as well as to combat a perceived risk of deflation.[71] As early as 2002 it was apparent that credit was fueling housing instead of business investment as some economists went so far as to advocate that the Fed “needs to create a housing bubble to replace the Nasdaq bubble”.[72]

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U.S. current account deficit.

Additional downward pressure on interest rates was created by the high and rising U.S. current account deficit, which peaked along with the housing bubble in 2006. Federal Reserve Chairman Ben Bernanke explained how trade deficits required the U.S. to borrow money from abroad, in the process bidding up bond prices and lowering interest rates.[73]

 

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Bernanke explained that between 1996 and 2004, the U.S. current account deficit increased by $650 billion, from 1.5% to 5.8% of GDP. Financing these deficits required the country to borrow large sums from abroad,

 

Sony VAIO VPCS11X9E Batterymuch of it from countries running trade surpluses. These were mainly the emerging economies in Asia and oil-exporting nations. The balance of payments identity requires that a country (such as the U.S.) running a current account deficit also have a capital account (investment) surplus of the same amount. Hence large and growing amounts of foreign funds (capital) flowed into the U.S. to finance its imports. 
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All of this created demand for various types of financial assets, raising the prices of those assets while lowering interest rates. Foreign investors had these funds to lend either because they had very high personal savings rates (as high as 40% in China) or because of high oil prices. Ben Bernanke has referred to this as a “saving glut”.[74] Sony VAIO VPCS11D7E Battery

 

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A flood of funds (capital or liquidity) reached the U.S. financial markets. Foreign governments supplied funds by purchasing Treasury bonds and thus avoided much of the direct impact of the crisis. U.S. households, Sony VAIO VPCS11E7E Battery

on the other hand, used funds borrowed from foreigners to finance consumption or to bid up the prices of housing and financial assets. Financial institutions invested foreign funds in mortgage-backed securities. Sony VAIO VPCS11F7E Battery

The Fed then raised the Fed funds rate significantly between July 2004 and July 2006.[75] This contributed to an increase in 1-year and 5-year adjustable-rate mortgage (ARM) rates, making ARM interest rate resets more expensive for homeowners.[ Sony VAIO VPCS11G7E Battery

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76] This may have also contributed to the deflating of the housing bubble, as asset prices generally move inversely to interest rates, and it became riskier to speculate in housing.[77][78] U.S. housing and financial assets dramatically declined in value after the housing bubble burst.[79][80]

 

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Weak and fraudulent underwriting practices

Testimony given to the Financial Crisis Inquiry Commission by Richard M. Bowen III on events during his tenure as the Business Chief Underwriter for Correspondent Lending in the Consumer Lending Group for Citigroup (where he was responsible for over 220 professional underwriters) suggests that by the final years of the U.S. housing bubble (2006–2007), Sony VAIO VPCS11M1E/W Battery

the collapse of mortgage underwriting standards was endemic. His testimony stated that by 2006, 60% of mortgages purchased by Citi from some 1,600 mortgage companies were “defective” (were not underwritten to policy, or did not contain all policy-required documents) – this,

 

Sony VAIO VPCS13S9E Battery despite the fact that each of these 1,600 originators were contractually responsible (certified via representations and warrantees) that their mortgage originations met Citi’s standards. Moreover, during 2007, “defective mortgages (from mortgage originators contractually bound to perform underwriting to Citi’s standards) increased… to over 80% of production”.[81]

 

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In separate testimony to Financial Crisis Inquiry Commission, officers of Clayton Holdings—the largest residential loan due diligence and securitization surveillance company in the United States and Europe—testified that Clayton’s review of over 900,000 mortgages issued from January 2006

 

Sony VAIO VPCS13S8R/S Battery to June 2007 revealed that scarcely 54% of the loans met their originators’ underwriting standards. The analysis (conducted on behalf of 23 investment and commercial banks, including 7 “too big to fail” banks) additionally showed that 28% of the sampled loans did not meet the minimal standards of any issuer.

 

Sony VAIO VPCS12E7E Battery Clayton’s analysis further showed that 39% of these loans (i.e. those not meeting any issuer’s minimal underwriting standards) were subsequently securitized and sold to investors.[82][83]

 

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There is strong evidence that the GSEs — due to their large size and market power — were far more effective at policing underwriting by originators and forcing underwriters to repurchase defective loans. By contrast, private securitizers have been far less aggressive and less effective in recovering losses from originators on behalf of investors.[7] Sony VAIO VPCS11M9R/B Battery

Predatory lending

Predatory lending refers to the practice of unscrupulous lenders, enticing borrowers to enter into “unsafe” or “unsound” secured loans for inappropriate purposes.[84Sony VAIO VPCS11V9E/B Battery

] A classic bait-and-switch method was used by Countrywide Financial, advertising low interest rates for home refinancing.

 

Sony VAIO VPCS12C5E Battery Such loans were written into extensively detailed contracts, and swapped for more expensive loan products on the day of closing. Whereas the advertisement might state that 1% or 1.5% interest would be charged, the consumer would be put into an adjustable rate mortgage (ARM) in which the interest charged would be greater than the amount of interest paid.

 

Sony VAIO VPCS12B7E Battery This created negative amortization, which the credit consumer might not notice until long after the loan transaction had been consummated.

Countrywide, sued by California Attorney General Jerry Brown for “unfair business practices” and “false advertising” was making high cost mortgages “to homeowners with weak credit, adjustable rate mortgages (ARMs) that allowed homeowners to make interest-only payments”.[85] Sony VAIO VPCS12A7E Battery

When housing prices decreased, homeowners in ARMs then had little incentive to pay their monthly payments, since their home equity had disappeared. This caused Countrywide’s financial condition to deteriorate, ultimately resulting in a decision by the Office of Thrift Supervision to seize the lender. Sony VAIO VPCS12A7R Battery

Former employees from Ameriquest, which was United States’ leading wholesale lender,[86] described a system in which they were pushed to falsify mortgage documents and then sell the mortgages to Wall Street banks eager to make fast profits.[86] There is growing evidence that such mortgage frauds may be a cause of the crisis.[86] Toshiba PA3733U-1BRS Battery

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Deregulation

Further information: Government policies and the subprime mortgage crisis

Critics such as economist Paul Krugman and U.S. Treasury Secretary Timothy Geithner have argued that the regulatory framework did not keep pace with financial innovation, such as the increasing importance of the shadow banking system, derivatives and off-balance sheet financing. A recent OECD study[87Toshiba PA3734U-1BRS Battery

] suggest that bank regulation based on the Basel accords encourage unconventional business practices and contributed to or even reinforced the financial crisis. In other cases, laws were changed or enforcement weakened in parts of the financial system. Key examples include:

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Jimmy Carter’s Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA) phased out a number of restrictions on banks’ financial practices, broadened their lending powers, and raised the deposit insurance limit from $40,000 to $100,000 (raising the problem of moral hazard).[88] Banks rushed into real estate lending, speculative lending, and other ventures just as the economy soured.[citation needed]

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In October 1982, U.S. President Ronald Reagan signed into law the Garn–St. Germain Depository Institutions Act, which provided for adjustable-rate mortgage loans, began the process of banking deregulation,[citation needed] and contributed to the savings and loan crisis of the late 1980s/early 1990s.[89]

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In November 1999, U.S. President Bill Clinton signed into law the Gramm–Leach–Bliley Act, which repealed part of the Glass–Steagall Act of 1933.

Toshiba PA5024U-1BRS Battery This repeal has been criticized for reducing the separation between commercial banks (which traditionally had fiscally conservative policies) and investment banks (which had a more risk-taking culture).[90][91] However, the vast majority of failures were at institutions that were created by Glass-Steagall.[92]

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In 2004, the U.S. Securities and Exchange Commission relaxed the net capital rule, which enabled investment banks to substantially increase the level of debt they were taking on, fueling the growth in mortgage-backed securities supporting subprime mortgages. The SEC has conceded that self-regulation of investment banks contributed to the crisis.[93][94] Toshiba PA3821U-1BRS Battery

Financial institutions in the shadow banking system are not subject to the same regulation as depository banks, allowing them to assume additional debt obligations relative to their financial cushion or capital base.

Toshiba A3635U-1BRM Battery [95] This was the case despite the Long-Term Capital Management debacle in 1998, where a highly-leveraged shadow institution failed with systemic implications.

Regulators and accounting standard-setters allowed depository banks such as Citigroup to move significant amounts of assets and liabilities off-balance sheet into complex legal entities called structured investment vehicles,

Toshiba PA3594U-1BRS Battery masking the weakness of the capital base of the firm or degree of leverage or risk taken. One news agency estimated that the top four U.S. banks will have to return between $500 billion and $1 trillion to their balance sheets during 2009.[9

Toshiba PA3780U-1BRS Battery6] This increased uncertainty during the crisis regarding the financial position of the major banks.[97] Off-balance sheet entities were also used by Enron as part of the scandal that brought down that company in 2001.[98]

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As early as 1997, Federal Reserve Chairman Alan Greenspan fought to keep the derivatives market unregulated.[99] With the advice of the President’s Working Group on Financial Markets,[100] the U.S. Congress and President allowed the self-regulation of the over-the-counter derivatives market when they enacted the Commodity Futures Modernization Act of 2000.

Toshiba PA3784U-1BRS Battery       Derivatives such as credit default swaps (CDS) can be used to hedge or speculate against particular credit risks. The volume of CDS outstanding increased 100-fold from 1998 to 2008, with estimates of the debt covered by CDS contracts, as of November 2008, ranging from US$33 to $47 trillion. Toshiba PA3785U-1BRS Battery

Total over-the-counter (OTC) derivative notional value rose to $683 trillion by June 2008.[101] Warren Buffett famously referred to derivatives as “financial weapons of mass destruction” in early 2003.[102][103]

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Increased debt burden or over-leveraging

Leverage ratios of investment banks increased significantly 2003–07

Prior to the crisis, financial Institutions became highly leveraged, increasing their appetite for risky investments and reducing their resilience in case of losses. Sony VAIO PCG-3B1M Battery

Sony VAIO PCG-71312M Battery Much of this leverage was achieved using complex financial instruments such as off-balance sheet securitization and derivatives, which made it difficult for creditors and regulators to monitor and try to reduce financial institution risk levels.[9] These instruments also made it virtually impossible to reorganize financial institutions in bankruptcy, and contributed to the need for government bailouts.[9]

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Household debt relative to disposable income and GDP.

U.S. households and financial institutions became increasingly indebted or overleveraged during the years preceding the crisis.[104] This increased their vulnerability to the collapse of the housing bubble and worsened the ensuing economic downturn.[105] Key statistics include: Sony VAIO PCG-3D1M Battery

Free cash used by consumers from home equity extraction doubled from $627 billion in 2001 to $1,428 billion in 2005 as the housing bubble built, a total of nearly $5 trillion dollars over the period, contributing to economic growth worldwide.[106][10

Sony VAIO PCG-41112M Battery7][108] U.S. home mortgage debt relative to GDP increased from an average of 46% during the 1990s to 73% during 2008, reaching $10.5 trillion.[109]

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USA household debt as a percentage of annual disposable personal income was 127% at the end of 2007, versus 77% in 1990.[104] In 1981, U.S. private debt was 123% of GDP; by the third quarter of 2008, it was 290%.[110]

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From 2004–07, the top five U.S. investment banks each significantly increased their financial leverage (see diagram), which increased their vulnerability to a financial shock. Changes in capital requirements, intended to keep U.S. banks competitive with their European counterparts, allowed lower risk weightings for AAA securities.

Sony VAIO PCG-7154M Battery The shift from first-loss tranches to AAA tranches was seen by regulators as a risk reduction that compensated the higher leverage.[111] These five institutions reported over $4.1 trillion in debt for fiscal year 2007, about 30% of USA nominal GDP for 2007. Lehman Brothers was liquidated,

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Bear Stearns and Merrill Lynch were sold at fire-sale prices, and Goldman Sachs and Morgan Stanley became commercial banks, subjecting themselves to more stringent regulation. With the exception of Lehman, these companies required or received government support.[112]

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Fannie Mae and Freddie Mac, two U.S. Government sponsored enterprises, owned or guaranteed nearly $5 trillion in mortgage obligations at the time they were placed into conservatorship by the U.S. government in September 2008.[113][114]

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These seven entities were highly leveraged and had $9 trillion in debt or guarantee obligations; yet they were not subject to the same regulation as depository banks.[95][115]Sony VAIO PCG-3G2M Battery

Behavior that may be optimal for an individual (e.g., saving more during adverse economic conditions) can be detrimental if too many individuals pursue the same behavior, as ultimately one person’s consumption is another person’s income. Sony VAIO PCG-5R1M Battery      Too many consumers attempting to save (or pay down debt) simultaneously is called the paradox of thrift and can cause or deepen a recession. Economist Hyman Minsky also described a “paradox of deleveraging” as financial institutions that have too much leverage (debt relative to equity) cannot all de-leverage simultaneously without significant declines in the value of their assets.[105]

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During April 2009, U.S. Federal Reserve Vice Chair Janet Yellen discussed these paradoxes: “Once this massive credit crunch hit, it didn’t take long before we were in a recession. The recession, in turn, deepened the credit crunch as demand and employment fell, and credit losses of financial institutions surged. Indeed,

Sony VAIO PCG-7171M Batterywe have been in the grips of precisely this adverse feedback loop for more than a year. A process of balance sheet deleveraging has spread to nearly every corner of the economy. Consumers are pulling back on purchases, especially on durable goods, to build their savings. Businesses are cancelling planned investments and laying off workers to preserve cash. And,

Sony VAIO PCG-9Z1M Battery financial institutions are shrinking assets to bolster capital and improve their chances of weathering the current storm. Once again, Minsky understood this dynamic. He spoke of the paradox of deleveraging, in which precautions that may be smart for individuals and firms—and indeed essential to return the economy to a normal state—nevertheless magnify the distress of the economy as a whole.”[105]

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Financial innovation and complexity

This section may stray from the topic of the article into the topic of another article, financial innovation. Please help improve this section or discuss this issue on the talk page. (December 2011)

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IMF Diagram of CDO and RMBS

The term financial innovation refers to the ongoing development of financial products designed to achieve particular client objectives, such as offsetting a particular risk exposure (such as the default of a borrower) or to assist with obtaining financing. Examples pertinent to this crisis included: the adjustable-rate mortgage;

Sony VAIO PCG-5N2M Battery the bundling of subprime mortgages into mortgage-backed securities (MBS) or collateralized debt obligations (CDO) for sale to investors, a type of securitization; and a form of credit insurance called credit default swaps (CDS).

Sony VAIO PCG-3C2M Battery The usage of these products expanded dramatically in the years leading up to the crisis. These products vary in complexity and the ease with which they can be valued on the books of financial institutions.

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CDO issuance grew from an estimated $20 billion in Q1 2004 to its peak of over $180 billion by Q1 2007, then declined back under $20 billion by Q1 2008. Further, the credit quality of CDO’s declined from 2000–2007,

Sony VAIO PCG-8141M Batteryas the level of subprime and other non-prime mortgage debt increased from 5% to 36% of CDO assets.[116] As described in the section on subprime lending, the CDS and portfolio of CDS called synthetic CDO[dubious – discuss][citation needed] enabled a theoretically infinite amount to be wagered on the finite value of housing loans outstanding, Sony VAIO PCG-3C1M Battery

provided that buyers and sellers of the derivatives could be found. For example, buying a CDS to insure a CDO ended up giving the seller the same risk[citation needed] as if they owned the CDO, when those CDO’s became worthless.[117]

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Diagram of CMLTI 2006 – NC2

This boom in innovative financial products went hand in hand with more complexity. It multiplied the number of actors connected to a single mortgage (including mortgage brokers, specialized originators, the securitizers and their due diligence firms, managing agents and trading desks,

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and finally investors, insurances and providers of repo funding). With increasing distance from the underlying asset these actors relied more and more on indirect information (including FICO scores on creditworthiness, Sony VAIO PCG-3F1M Battery appraisals and due diligence checks by third party organizations, and most importantly the computer models of rating agencies and risk management desks). Instead of spreading risk this provided the ground for fraudulent acts, misjudgments and finally market collapse.[118]Sony VAIO PCG-5G2M Battery

Martin Wolf further wrote in June 2009 that certain financial innovations enabled firms to circumvent regulations, such as off-balance sheet financing that affects the leverage or capital cushion reported by major banks, stating: “…an enormous part of what banks did in the early part of this decade – the off-balance-sheet vehicles, the derivatives and the ‘shadow banking system’ itself – was to find a way round regulation.”[119] Sony VAIO PCG-5J1M Battery

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Incorrect pricing of risk

A protester on Wall Street in the wake of the AIG bonus payments controversy is interviewed by news media.

The pricing of risk refers to the incremental compensation required by investors for taking on additional risk, which may be measured by interest rates or fees. Several scholars have argued that a lack of transparency about banks’ risk exposures prevented markets from correctly pricing risk before the crisis, Sony VAIO PCG-5J4M Battery

enabled the mortgage market to grow larger than it otherwise would have, and made the financial crisis far more disruptive than it would have been if risk levels had been disclosed in a straightforward, readily understandable format.[7][9]

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For a variety of reasons, market participants did not accurately measure the risk inherent with financial innovation such as MBS and CDOs or understand its impact on the overall stability of the financial system.[21]

Sony VAIO PCG-8112M Battery For example, the pricing model for CDOs clearly did not reflect the level of risk they introduced into the system. Banks estimated that $450bn of CDO were sold between “late 2005 to the middle of 2007″; among the $102bn of those that had been liquidated,

Sony VAIO PCG-7134M BatteryJPMorgan estimated that the average recovery rate for “high quality” CDOs was approximately 32 cents on the dollar, while the recovery rate for mezzanine CDO was approximately five cents for every dollar.[120]

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Another example relates to AIG, which insured obligations of various financial institutions through the usage of credit default swaps. The basic CDS transaction involved AIG receiving a premium in exchange for a promise to pay money to party A in the event party B defaulted. Sony VAIO PCG-5J5M Battery

However, AIG did not have the financial strength to support its many CDS commitments as the crisis progressed and was taken over by the government in September 2008. U.S. taxpayers provided over $180 billion in government support to AIG during 2008 and early 2009, through which the money flowed to various counterparties to CDS transactions, including many large global financial institutions.[121][122] Sony VAIO PCG-5L2M Battery

The limitations of a widely-used financial model also were not properly understood.[123][124] This formula assumed that the price of CDS was correlated with and could predict the correct price of mortgage-backed securities. Because it was highly tractable, it rapidly came to be used by a huge percentage of CDO and CDS investors, issuers, and rating agencies.[124] According to one wired.com article:

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Then the model fell apart. Cracks started appearing early on, when financial markets began behaving in ways that users of Li’s formula hadn’t expected. Sony VAIO PCG-6S4M Battery

Sony VAIO PCG-7122M BatteryThe cracks became full-fledged canyons in 2008—when ruptures in the financial system’s foundation swallowed up trillions of dollars and put the survival of the global banking system in serious peril… Li’s Gaussian copula formula will go down in history as instrumental in causing the unfathomable losses that brought the world financial system to its knees.[124]

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As financial assets became more and more complex, and harder and harder to value, investors were reassured by the fact that both the international bond rating agencies and bank regulators, who came to rely on them, accepted as valid some complex mathematical models which theoretically showed the risks were much smaller than they actually proved to be.[1

Sony VAIO PCG-7113M Battery25] George Soros commented that “The super-boom got out of hand when the new products became so complicated that the authorities could no longer calculate the risks and started relying on the risk management methods of the banks themselves. Similarly, the rating agencies relied on the information provided by the originators of synthetic products. It was a shocking abdication of responsibility.”[126]

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Moreover, a conflict of interest between professional investment managers and their institutional clients, combined with a global glut in investment capital, led to bad investments by asset managers in over-priced credit assets.

Sony VAIO PCG-8Z3M BatteryProfessional investment managers generally are compensated based on the volume of client assets under management. There is, therefore, an incentive for asset managers to expand their assets under management in order to maximize their compensation.

Sony VAIO PCG-8Z2M Battery As the glut in global investment capital caused the yields on credit assets to decline, asset managers were faced with the choice of either investing in assets where returns did not reflect true credit risk or returning funds to clients. Many asset managers chose to continue to invest client funds in over-priced (under-yielding) investments,

Sony VAIO PCG-8Z1M Battery to the detriment of their clients, in order to maintain their assets under management. This choice was supported by a “plausible deniability” of the risks associated with subprime-based credit assets because the loss experience with early “vintages” of subprime loans was so low.[127]

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Despite the dominance of the above formula, there are documented attempts of the financial industry, occurring before the crisis, to address the formula limitations, specifically the lack of dependence dynamics and the poor representation of extreme events.[128] The volume “Credit Correlation: Life After Copulas”,

Sony VAIO PCG-8Y2M Battery published in 2007 by World Scientific, summarizes a 2006 conference held by Merrill Lynch in London where several practitioners attempted to propose models rectifying some of the copula limitations. See also the article by Donnelly and Embrechts[129] and the book by Brigo, Pallavicini and Torresetti, that reports relevant warnings and research on CDOs appeared in 2006.[130]

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Mortgage risks were underestimated by every institution in the chain from originator to investor by underweighting the possibility of falling housing prices based on historical trends of the past 50 years. Limitations of default and prepayment models, Sony VAIO PCG-6W2M Battery

the heart of pricing models, led to overvaluation of mortgage and asset-backed products and their derivatives by originators, securitizers, broker-dealers, rating-agencies, insurance underwriters and investors. [131][132] Sony VAIO PCG-6W1M Battery

Boom and collapse of the shadow banking system

Securitization markets were impaired during the crisis

There is strong evidence that the riskiest, worst performing mortgages were funded through the “shadow banking system” and that competition from the shadow banking system may have pressured more traditional institutions to lower their own underwriting standards and originate riskier loans.[7]

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In a June 2008 speech, President and CEO of the New York Federal Reserve Bank Timothy Geithner—who in 2009 became Secretary of the United States Treasury—placed significant blame for the freezing of credit markets on a “run” on the entities in the “parallel” banking system, also called the shadow banking system. Sony PCG-61211M Battery

These entities became critical to the credit markets underpinning the financial system, but were not subject to the same regulatory controls. Further, these entities were vulnerable because of maturity mismatch, meaning that they borrowed short-term in liquid markets to purchase long-term, illiquid and risky assets.

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This meant that disruptions in credit markets would make them subject to rapid deleveraging, selling their long-term assets at depressed prices. He described the significance of these entities:


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In early 2007, asset-backed commercial paper conduits, in structured investment vehicles, in auction-rate preferred securities, tender option bonds and variable rate demand notes, had a combined asset size of roughly $2.2 trillion. Assets financed overnight in triparty repo grew to $2.5 trillion.

Sony PCG-91111M BatteryAssets held in hedge funds grew to roughly $1.8 trillion. The combined balance sheets of the then five major investment banks totaled $4 trillion. In comparison, the total assets of the top five bank holding companies in the United States at that point were just over $6 trillion,

Sony PCG-61713M Batteryand total assets of the entire banking system were about $10 trillion. The combined effect of these factors was a financial system vulnerable to self-reinforcing asset price and credit cycles.[33]

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Paul Krugman, laureate of the Nobel Prize in Economics, described the run on the shadow banking system as the “core of what happened” to cause the crisis. He referred to this lack of controls as “malign neglect” and argued that regulation should have been imposed on all banking-like activity.[95]

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The securitization markets supported by the shadow banking system started to close down in the spring of 2007 and nearly shut-down in the fall of 2008. More than a third of the private credit markets thus became unavailable as a source of funds.[133] According to the Brookings Institution,

Sony PCG-71911M Batterythe traditional banking system does not have the capital to close this gap as of June 2009: “It would take a number of years of strong profits to generate sufficient capital to support that additional lending volume.” The authors also indicate that some forms of securitization are “likely to vanish forever, having been an artifact of excessively loose credit conditions.”[134

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Economist Mark Zandi testified to the Financial Crisis Inquiry Commission in January 2010: “The securitization markets also remain impaired, as investors anticipate more loan losses. Investors are also uncertain about coming legal and accounting rule changes and regulatory reforms. Private bond issuance of residential and commercial mortgage-backed securities, asset-backed securities,

Sony PCG-71212M Batteryand CDOs peaked in 2006 at close to $2 trillion…In 2009, private issuance was less than $150 billion, and almost all of it was asset-backed issuance supported by the Federal Reserve’s TALF program to aid credit card, auto and small-business lenders. Issuance of residential and commercial mortgage-backed securities and CDOs remains dormant.”[135]

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Commodities boom

Main article: 2000s commodities boom

Rapid increases in a number of commodity prices followed the collapse in the housing bubble. The price of oil nearly tripled from $50 to $147 from early 2007 to 2008, before plunging as the financial crisis began to take hold in late 2008.

Sony PCG-71311M Battery136] Experts debate the causes, with some attributing it to speculative flow of money from housing and other investments into commodities, some to monetary policy,[13[ Sony PCG-71213M Battery

7] and some to the increasing feeling of raw materials scarcity in a fast growing world, leading to long positions taken on those markets, such as Chinese increasing presence in Africa. An increase in oil prices tends to divert a larger share of consumer spending into gasoline, which creates downward pressure on economic growth in oil importing countries, Sony PCG-61211M Battery

Sony VGP-BPS22A Battery as wealth flows to oil-producing states.[138] A pattern of spiking instability in the price of oil over the decade leading up to the price high of 2008 has been recently identified.[139] The destabilizing effects of this price variance has been proposed as a contributory factor in the financial crisis.

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In testimony before the Senate Committee on Commerce, Science, and Transportation on June 3, 2008, former director of the CFTC Division of Trading & Markets (responsible for enforcement) Michael Greenberger specifically named the Atlanta-based IntercontinentalExchange, founded by Goldman Sachs,

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Morgan Stanley and BP as playing a key role in speculative run-up of oil futures prices traded off the regulated futures exchanges in London and New York.[140] However, the IntercontinentalExchange (ICE) had been regulated by both European and U.S. authorities since its purchase of the International Petroleum Exchange in 2001. Mr Greenberger was later corrected on this matter.[141]

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Global copper prices

Copper prices increased at the same time as the oil prices. Copper traded at about $2,500 per tonne from 1990 until 1999, when it fell to about $1,600. The price slump lasted until 2004 which saw a price surge that had copper reaching $7,040 per tonne in 2008.[142]Sony PCG-71213M Battery

Nickel prices boomed in the late 1990s, then the price of nickel imploded from around $51,000 /£36,700 per metric ton in May 2007 to about $11,550/£8,300 per metric ton in January 2009. Prices were only just starting to recover as of January 2010, but most of Australia’s nickel mines had gone bankrupt by then.[14

Sony VGP-BPL26 Battery3] As the price for high grade nickel sulphate ore recovered in 2010, so did the Australian nickel mining industry.[144]

Coincidentally with these price fluctuations, long-only commodity index funds became popular – by one estimate investment increased from $90 billion in 2006 to $200 billion at the end of 2007, while commodity prices increased 71% – which raised concern as to whether these index funds caused the commodity bubble.[14

Sony VGP-BPS26 Battery5] The empirical research has been mixed.[145]

Systemic crisis

Another analysis, different from the mainstream explanation, is that the financial crisis is merely a symptom of another, deeper crisis, which is a systemic crisis of capitalism itself.[146]

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Ravi Batra’s theory is that growing inequality of financial capitalism produces speculative bubbles that burst and result in depression and major political changes. He has also suggested that a “demand gap” related to differing wage and productivity growth explains deficit and debt dynamics important to stock market developments.[147][148] Sony PCG-71311M Battery

John Bellamy Foster, a political economy analyst and editor of the Monthly Review, believes that the decrease in GDP growth rates since the early 1970s is due to increasing market saturation.[149]

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John C. Bogle wrote during 2005 that a series of unresolved challenges face capitalism that have contributed to past financial crises and have not been sufficiently addressed:

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Corporate America went astray largely because the power of managers went virtually unchecked by our gatekeepers for far too long… They failed to ‘keep an eye on these geniuses’ to whom they had entrusted the responsibility of the management of America’s great corporations. Sony PCG-71313M Battery

Echoing the central thesis of James Burnham’s 1941 seminal book, The Managerial Revolution, Bolge cites particular issues, including:[150][151]

that “Manager’s capitalism” has replaced “owner’s capitalism”, meaning management runs the firm for its benefit rather than for the shareholders, a variation on the principal–agent problem;

the burgeoning executive compensation;

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the management of earnings, mainly a focus on share price rather than the creation of genuine value; and

the failure of gatekeepers, including auditors, boards of directors, Wall Street analysts, and career politicians.

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An analysis conducted by Mark Roeder, a former executive at the Swiss-based UBS Bank, suggested that large scale momentum, or The Big Mo “played a pivotal role” in the 2008–09 global financial crisis. Roeder suggested that “recent technological advances, such as computer-driven trading programs, together with the increasingly interconnected nature of markets, has magnified the momentum effect. This has made the financial sector inherently unstable.”[152] Sony PCG-71212M Battery

Robert Reich has attributed the current economic downturn to the stagnation of wages in the United States, particularly those of the hourly workers who comprise 80% of the workforce. His claim is that this stagnation forced the population to borrow in order to meet the cost of living.[153] Sony PCG-71811M Battery

Role of economic forecasting

The financial crisis was not widely predicted by mainstream economists, who instead spoke of the Great Moderation. A number of heterodox economists predicted the crisis, with varying arguments. Dirk Bezemer in his research[15

Sony VAIO PCG-7186M Battery4] credits (with supporting argument and estimates of timing) 12 economists with predicting the crisis: Dean Baker (US), Wynne Godley (UK), Fred Harrison (UK), Michael Hudson (US), Eric Janszen (US), Steve Keen (Australia), Jakob Brøchner Madsen & Jens Kjaer Sørensen (Denmark), Kurt Richebächer (US), Nouriel Roubini (US), Peter Schiff (US), and Robert Shiller (US).

Sony VAIO PCG-7171M Battery Examples of other experts who gave indications of a financial crisis have also been given.[155][156][157] Not surprisingly, the Austrian economic school regarded the crisis as a vindication and classic example of a predictable credit-fueled bubble that could not forestall the disregarded but inevitable effect of an artificial,

Sony VAIO PCG-9Z1M Battery manufactured laxity in monetary supply,[158] a perspective that even former Fed Chair Alan Greenspan in Congressional testimony confessed himself forced to return to.[159]

A cover story in BusinessWeek magazine claims that economists mostly failed to predict the worst international economic crisis since the Great Depression of 1930s.[16

Sony VAIO PCG-5S1M Battery0] The Wharton School of the University of Pennsylvania’s online business journal examines why economists failed to predict a major global financial crisis.[161] Popular articles published in the mass media have led the general public to believe that the majority of economists have failed in their obligation to predict the financial crisis. For example,

Sony VAIO PCG-5P1M Batteryan article in the New York Times informs that economist Nouriel Roubini warned of such crisis as early as September 2006, and the article goes on to state that the profession of economics is bad at predicting recessions.[162

Sony VAIO PCG-5N2M Battery] According to The Guardian, Roubini was ridiculed for predicting a collapse of the housing market and worldwide recession, while The New York Times labelled him “Dr. Doom”.[163]

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Shiller, an expert in housing markets, wrote an article a year before the collapse of Lehman Brothers in which he predicted that a slowing US housing market would cause the housing bubble to burst, leading to financial collapse.[164] Schiff regularly appeared on television in the years before the crisis and warned of the impending real estate collapse.[165]

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Within mainstream financial economics, most believe that financial crises are simply unpredictable,[166] following Eugene Fama’s efficient-market hypothesis and the related random-walk hypothesis, which state respectively that markets contain all information about possible future movements, and that the movement of financial prices are random and unpredictable.

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Lebanese-American trader and financial risk engineer Nassim Nicholas Taleb, author of the 2007 book The Black Swan, spent years warning against the breakdown of the banking system in particular and the economy in general owing to their use of bad risk models and reliance on forecasting, and their reliance on bad models, and framed the problem as part of “robustness and fragility”.[167][168

Sony VAIO PCG-3J1M Battery] He also took action against the establishment view by making a big financial bet on banking stocks and making a fortune from the crisis (“They didn’t listen, so I took their money”).[169] According to David Brooks from the New York Times, “Taleb not only has an explanation for what’s happening, he saw it coming.”[170]

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Impact on financial markets

US stock market

The US stock market peaked in October 2007, when the Dow Jones Industrial Average index exceeded 14,000 points. It then entered a pronounced decline, which accelerated markedly in October 2008. By March 2009, 

Sony VAIO PCG-3F1M Batterythe Dow Jones average had reached a trough of around 6,600. It has since recovered much of the decline, exceeding 12,000 during most of 2011, and occasionally reaching 13,000 in 2012. It is probable, but debated, whether the Federal Reserve’s aggressive policy of quantitative easing spurred the partial recovery in the stock market.[171][172][173]

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Market strategist Phil Dow believes distinctions exist “between the current market malaise” and the Great Depression. He says the Dow Jones average’s fall of more than 50% over a period of 17 months is similar to a 54.7% fall in the Great Depression, followed by a total drop of 89% over the following 16 months.

Sony VAIO PCG-71312M Battery“It’s very troubling if you have a mirror image,” said Dow.[174] Floyd Norris, the chief financial correspondent of The New York Times, wrote in a blog entry in March 2009 that the decline has not been a mirror image of the Great Depression, explaining that although the decline amounts were nearly the same at the time, Sony VAIO PCG-3B1M Battery

Sony VAIO PCG-7153M Batterythe rates of decline had started much faster in 2007, and that the past year had only ranked eighth among the worst recorded years of percentage drops in the Dow. The past two years ranked third, however.[175]

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Financial institutions

See also: Nationalisation of Northern Rock and Federal takeover of Fannie Mae and Freddie Mac

2007 bank run on Northern Rock, a UK bank

The first notable event signaling a possible financial crisis occurred in the United Kingdom on August 9, 2007 when BNP Paribas, citing “a complete evaporation of liquidity”, blocked withdrawals from three hedge funds.

Sony VAIO PCG-7181M Battery The significance of this event was not immediately recognized but soon led to a panic as investors and savers attempted to liquidate assets deposited in highly-leveraged financial institutions.[4]

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The International Monetary Fund estimated that large U.S. and European banks lost more than $1 trillion on toxic assets and from bad loans from January 2007 to September 2009. These losses are expected to top $2.8 trillion from 2007–10. U.S. banks losses were forecast to hit $1 trillion and European bank losses will reach $1.6 trillion. The International Monetary Fund (IMF) estimated that U.S. banks were about 60% through their losses, but British and eurozone banks only 40%.[176]

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One of the first victims was Northern Rock, a medium-sized British bank.[177] The highly leveraged nature of its business led the bank to request security from the Bank of England. This in turn led to investor panic and a bank run[1

Sony VAIO PCG-7151M Battery78] in mid-September 2007. Calls by Liberal Democrat Treasury Spokesman Vince Cable to nationalise the institution were initially ignored; in February 2008, however, the British government (having failed to find a private sector buyer) relented, and the bank was taken into public hands. Northern Rock’s problems proved to be an early indication of the troubles that would soon befall other banks and financial institutions. Sony VAIO PCG-3D1M Battery

Initially the companies affected were those directly involved in home construction and mortgage lending such as Northern Rock and Countrywide Financial, as they could no longer obtain financing through the credit markets. Over 100 mortgage lenders went bankrupt during 2007 and 2008.

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Concerns that investment bank Bear Stearns would collapse in March 2008 resulted in its fire-sale to JP Morgan Chase. The financial institution crisis hit its peak in September and October 2008. Several major institutions either failed, were acquired under duress, or were subject to government takeover. These included Lehman Brothers, Merrill Lynch, Fannie Mae, Freddie Mac, Washington Mutual, Wachovia, Citigroup, and AIG.[179]

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Credit markets and the shadow banking system

TED spread and components during 2008

During September 2008, the crisis hit its most critical stage. There was the equivalent of a bank run on the money market mutual funds, which frequently invest in commercial paper issued by corporations to fund their operations and payrolls. Withdrawal from money markets were $144.5 billion during one week, versus $7.1 billion the week prior. Sony VAIO PCG-5R1M Battery

This interrupted the ability of corporations to rollover (replace) their short-term debt. The U.S. government responded by extending insurance for money market accounts analogous to bank deposit insurance via a temporary guarantee[18Sony VAIO PCG-3G2M Battery

0] and with Federal Reserve programs to purchase commercial paper. The TED spread, an indicator of perceived credit risk in the general economy, spiked up in July 2007, remained volatile for a year, then spiked even higher in September 2008,[181] reaching a record 4.65% on October 10, 2008.

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In a dramatic meeting on September 18, 2008, Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke met with key legislators to propose a $700 billion emergency bailout. Bernanke reportedly told them: “If we don’t do this, Sony VAIO PCG-3C1M Battery

Sony VAIO PCG-7171M Battery we may not have an economy on Monday.”[182] The Emergency Economic Stabilization Act, which implemented the Troubled Asset Relief Program (TARP), was signed into law on October 3, 2008.[183]

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Economist Paul Krugman and U.S. Treasury Secretary Timothy Geithner explain the credit crisis via the implosion of the shadow banking system, which had grown to nearly equal the importance of the traditional commercial banking sector as described above.

Sony VAIO PCG-8131M Battery Without the ability to obtain investor funds in exchange for most types of mortgage-backed securities or asset-backed commercial paper, investment banks and other entities in the shadow banking system could not provide funds to mortgage firms and other corporations.[33][95]

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This meant that nearly one-third of the U.S. lending mechanism was frozen and continued to be frozen into June 2009.[133] According to the Brookings Institution, the traditional banking system does not have the capital to close this gap as of June 2009:

Sony VAIO PCG-5P1M Battery ”It would take a number of years of strong profits to generate sufficient capital to support that additional lending volume.” The authors also indicate that some forms of securitization are “likely to vanish forever, having been an artifact of excessively loose credit conditions.”

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While traditional banks have raised their lending standards, it was the collapse of the shadow banking system that is the primary cause of the reduction in funds available for borrowing.[184]

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Wealth effects

The New York City headquarters of Lehman Brothers

There is a direct relationship between declines in wealth, and declines in consumption and business investment, which along with government spending represent the economic engine. Between June 2007 and November 2008,

Sony VAIO PCG-8161M BatteryAmericans lost an estimated average of more than a quarter of their collective net worth.[citation needed] By early November 2008, a broad U.S. stock index the S&P 500, was down 45% from its 2007 high.

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Housing prices had dropped 20% from their 2006 peak, with futures markets signaling a 30–35% potential drop. Total home equity in the United States, which was valued at $13 trillion at its peak in 2006, had dropped to $8.8 trillion by mid-2008 and was still falling in late 2008. Total retirement assets, Americans’ second-largest household asset, dropped by 22%, from $10.3 trillion in 2006 to $8 trillion in mid-2008

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During the same period, savings and investment assets (apart from retirement savings) lost $1.2 trillion and pension assets lost $1.3 trillion. Taken together, these losses total a staggering $8.3 trillion.[185] Since peaking in the second quarter of 2007, household wealth is down $14 trillion.[186] Sony VAIO PCG-3F1M Battery

Further, U.S. homeowners had extracted significant equity in their homes in the years leading up to the crisis, which they could no longer do once housing prices collapsed. Free cash used by consumers from home equity extraction doubled from $627 billion in 2001 to $1,428 billion in 2005 as the housing bubble built, Sony VAIO PCG-3H1M Battery

a total of nearly $5 trillion over the period.[106][107][108] U.S. home mortgage debt relative to GDP increased from an average of 46% during the 1990s to 73% during 2008, reaching $10.5 trillion.[109]

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To offset this decline in consumption and lending capacity, the U.S. government and U.S. Federal Reserve have committed $13.9 trillion, of which $6.8 trillion has been invested or spent, as of June 2009.[187] In effect, the Fed has gone from being the “lender of last resort” to the “lender of only resort” for a significant portion of the economy. In some cases the Fed can now be considered the “buyer of last resort”.Sony VAIO PCG-8152M Battery

Economist Dean Baker explained the reduction in the availability of credit this way:

Yes, consumers and businesses can’t get credit as easily as they could a year ago. There is a really good reason for tighter credit. Tens of millions of homeowners who had substantial equity in their homes two years ago have little or nothing today. Businesses are facing the worst downturn since the Great Depression.

Sony VAIO PCG-71312M Battery This matters for credit decisions. A homeowner with equity in her home is very unlikely to default on a car loan or credit card debt. They will draw on this equity rather than lose their car and/or have a default placed on their credit record. On the other hand, a homeowner who has no equity is a serious default risk. Sony VAIO PCG-9Z1M Battery

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In the case of businesses, their creditworthiness depends on their future profits. Profit prospects look much worse in November 2008 than they did in November 2007 (of course, to clear-eyed analysts, they didn’t look too good a year ago either). Sony VAIO PCG-3B1M Battery

While many banks are obviously at the brink, consumers and businesses would be facing a much harder time getting credit right now even if the financial system were rock solid. The problem with the economy is the loss of close to $6 trillion in housing wealth and an even larger amount of stock wealth.

Sony VAIO PCG-41112M Battery Economists, economic policy makers and economic reporters virtually all missed the housing bubble on the way up. If they still can’t notice its impact as the collapse of the bubble throws into the worst recession in the post-war era, then they are in the wrong profession.[188]

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At the heart of the portfolios of many of these institutions were investments whose assets had been derived from bundled home mortgages. Exposure to these mortgage-backed securities, or to the credit derivatives used to insure them against failure, caused the collapse or takeover of several key firms such as Lehman Brothers, AIG, Merrill Lynch, and HBOS.[

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European contagion

The crisis rapidly developed and spread into a global economic shock, resulting in a number of European bank failures, declines in various stock indexes, and large reductions in the market value of equities[192] and commodities.[193]

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Both MBS and CDO were purchased by corporate and institutional investors globally. Derivatives such as credit default swaps also increased the linkage between large financial institutions. Moreover, the de-leveraging of financial institutions,

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as assets were sold to pay back obligations that could not be refinanced in frozen credit markets, further accelerated the solvency crisis and caused a decrease in international trade.

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World political leaders, national ministers of finance and central bank directors coordinated their efforts[194] to reduce fears, but the crisis continued. At the end of October 2008 a currency crisis developed,

Sony VAIO PCG-7141M Batterywith investors transferring vast capital resources into stronger currencies such as the yen, the dollar and the Swiss franc, leading many emergent economies to seek aid from the International Monetary Fund.[195][196]

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Effects on the global economy

Main article: 2008–2012 global recession

Global effects

A number of commentators have suggested that if the liquidity crisis continues, there could be an extended recession or worse.[197] The continuing development of the crisis has prompted in some quarters fears of a global economic collapse although there are now many cautiously optimistic forecasters in addition to some prominent sources who remain negative.[1

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98] The financial crisis is likely to yield the biggest banking shakeout since the savings-and-loan meltdown.[199] Investment bank UBS stated on October 6 that 2008 would see a clear global recession, with recovery unlikely for at least two years.[20Sony VAIO PCG-3C1T Battery

Sony VAIO PCG-3D1M Battery 0] Three days later UBS economists announced that the “beginning of the end” of the crisis had begun, with the world starting to make the necessary actions to fix the crisis: capital injection by governments;

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injection made systemically; interest rate cuts to help borrowers. The United Kingdom had started systemic injection, and the world’s central banks were now cutting interest rates. UBS emphasized the United States needed to implement systemic injection. UBS further emphasized that this fixes only the financial crisis, but that in economic terms “the worst is still to come”.

Sony VGP-BPS26A Battery [201] UBS quantified their expected recession durations on October 16: the Eurozone’s would last two quarters, the United States’ would last three quarters, and the United Kingdom’s would last four quarters.[202] The economic crisis in Iceland involved all three of the country’s major banks. Relative to the size of its economy, Iceland’s banking collapse is the largest suffered by any country in economic history.[203]

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At the end of October UBS revised its outlook downwards: the forthcoming recession would be the worst since the early 1980s recession with negative 2009 growth for the U.S., Eurozone, UK; very limited recovery in 2010; but not as bad as the Great Depression.[204]

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The Brookings Institution reported in June 2009 that U.S. consumption accounted for more than a third of the growth in global consumption between 2000 and 2007. “The US economy has been spending too much and borrowing too much for years and the rest of the world depended on the U.S. consumer as a source of global demand.”

Sony VGP-BPS22A Battery With a recession in the U.S. and the increased savings rate of U.S. consumers, declines in growth elsewhere have been dramatic. For the first quarter of 2009, the annualized rate of decline in GDP was 14.4% in Germany, 15.2% in Japan, 7.4% in the UK, 18% in Latvia,[205] 9.8% in the Euro area and 21.5% for Mexico.[206]

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Some developing countries that had seen strong economic growth saw significant slowdowns. For example, growth forecasts in Cambodia show a fall from more than 10% in 2007 to close to zero in 2009,

Sony PCG-91111M Batteryand Kenya may achieve only 3–4% growth in 2009, down from 7% in 2007. According to the research by the Overseas Development Institute, reductions in growth can be attributed to falls in trade, commodity prices, investment and remittances sent from migrant workers (which reached a record $251 billion in 2007,

Sony PCG-61713M Battery but have fallen in many countries since).[207] This has stark implications and has led to a dramatic rise in the number of households living below the poverty line, be it 300,000 in Bangladesh or 230,000 in Ghana.[207]

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The World Bank reported in February 2009 that the Arab World was far less severely affected by the credit crunch. With generally good balance of payments positions coming into the crisis or with alternative sources of financing for their large current account deficits, such as remittances, Foreign Direct Investment (FDI) or foreign aid, Arab countries were able to avoid going to the market in the latter part of 2008.

Sony PCG-91211M BatteryThis group is in the best position to absorb the economic shocks. They entered the crisis in exceptionally strong positions. This gives them a significant cushion against the global downturn. The greatest impact of the global economic crisis will come in the form of lower oil prices,

Sony PCG-71811M Batterywhich remains the single most important determinant of economic performance. Steadily declining oil prices would force them to draw down reserves and cut down on investments. Significantly lower oil prices could cause a reversal of economic performance as has been the case in past oil shocks. Initial impact will be seen on public finances and employment for foreign workers.[208]

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U.S. economic effects

Real gross domestic product

The output of goods and services produced by labor and property located in the United States—decreased at an annual rate of approximately 6% in the fourth quarter of 2008 and first quarter of 2009,

Sony PCG-71911M Batteryversus activity in the year-ago periods.[209] The U.S. unemployment rate increased to 10.1% by October 2009, the highest rate since 1983 and roughly twice the pre-crisis rate. The average hours per work week declined to 33, the lowest level since the government began collecting the data in 1964.[210][211]

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Distribution of wealth

U.S. inequality from 1913–2008.

The very rich lost relatively less in the crisis than the remainder of the population, widening the wealth gap between the economic class at the very top of the demographic pyramid and everyone else beneath them. Thus the top 1% who owned 34.6% of the nation’s wealth in 2007 increased their proportional share to over 37.1% by 2009.[212][213]

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Typical American families did not fare as well, nor did those “wealthy-but-not wealthiest” families just beneath the pyramid’s top. On the other hand, half of the poorest families did not have wealth declines at all during the crisis. 
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Sony PCG-71213M Battery The Federal Reserve surveyed 4,000 households between 2007 and 2009, and found that the total wealth of 63 percent of all Americans declined in that period. 77 percent of the richest families had a decrease in total wealth, while only 50 percent of those on the bottom of the pyramid suffered a decrease.[214]

 

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Official economic projections

On November 3, 2008, the European Commission at Brussels predicted for 2009 an extremely weak growth of GDP, by 0.1%, for the countries of the Eurozone (France, Germany, Italy, Belgium etc.) and even negative number for the UK (−1.0%),Sony Vaio VGN-NR31E/S Battery

 

Sony Vaio VGN-NR38Z/T Battery Ireland and Spain. On November 6, the IMF at Washington, D.C., launched numbers predicting a worldwide recession by −0.3% for 2009, averaged over the developed economies. On the same day, the Bank of England and the European Central Bank, respectively, reduced their interest rates from 4.5% down to 3%, and from 3.75% down to 3.25%. As a consequence, starting from November 2008, several countries launched large “help packages” for their economies. Sony Vaio VGN-NR31ER/S Battery

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The U.S. Federal Reserve Open Market Committee release in June 2009 stated:

…the pace of economic contraction is slowing. Conditions in financial markets have generally improved in recent months. Household spending has shown further signs of stabilizing but remains constrained by ongoing job losses, lower housing wealth, and tight credit.

 

Sony Vaio VGN-NR38Z/S Battery Businesses are cutting back on fixed investment and staffing but appear to be making progress in bringing inventory stocks into better alignment with sales. Although economic activity is likely to remain weak for a time, the Committee continues to anticipate that policy actions to stabilize financial markets and institutions,Sony Vaio VGN-NR31MR/S Battery

fiscal and monetary stimulus, and market forces will contribute to a gradual resumption of sustainable economic growth in a context of price stability.[215] Economic projections from the Federal Reserve and Reserve Bank Presidents include a return to typical growth levels (GDP) of 2–3% in 2010; an unemployment plateau in 2009 and 2010 around 10% with moderation in 2011; and inflation that remains at typical levels around 1–2%.[216]Sony Vaio VGN-NR31S/S Battery

 

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Government responses

Emergency and short-term responses

Main article: Subprime mortgage crisis#Responses

 

Sony Vaio VGN-NR38M/S BatteryThe U.S. Federal Reserve and central banks around the world have taken steps to expand money supplies to avoid the risk of a deflationary spiral, in which lower wages and higher unemployment lead to a self-reinforcing decline in global consumption. In addition, governments have enacted large fiscal stimulus packages, by borrowing and spending to offset the reduction in private sector demand caused by the crisis. The U.S. executed two stimulus packages, totaling nearly $1 trillion during 2008 and 2009.[217]

 

 

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This credit freeze brought the global financial system to the brink of collapse. The response of the Federal Reserve, the European Central Bank, and other central banks was immediate and dramatic. During the last quarter of 2008,

Sony Vaio VGN-NR31ZR/S Batterythese central banks purchased US$2.5 trillion of government debt and troubled private assets from banks. This was the largest liquidity injection into the credit market, and the largest monetary policy action, in world history.Sony Vaio VGN-NR31SR/S Battery

 

The governments of European nations and the USA also raised the capital of their national banking systems by $1.5 trillion, by purchasing newly issued preferred stock in their major banks.[179] In October 2010, Nobel laureate Joseph Stiglitz explained how the U.S. Federal Reserve was implementing another monetary policy —creating currency— as a method to combat the liquidity trap.[218]                                                                        

Sony Vaio VGN-NR31Z/T Battery By creating $600,000,000,000 and inserting this directly into banks the Federal Reserve intended to spur banks to finance more domestic loans and refinance mortgages. However, banks instead were spending the money in more profitable areas by investing internationally in emerging markets. Sony Vaio VGN-NR31Z/S Battery Banks were also investing in foreign currencies which Stiglitz and others point out may lead to currency wars while China redirects its currency holdings away from the United States.[219]

Governments have also bailed out a variety of firms as discussed above, incurring large financial obligations. To date, various U.S. government agencies have committed or spent trillions of dollars in loans, asset purchases,

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guarantees, and direct spending. For a summary of U.S. government financial commitments and investments related to the crisis, see CNN – Bailout Scorecard. Significant controversy has accompanied the bailout, leading to the development of a variety of “decision making frameworks”, to help balance competing policy interests during times of financial crisis.[220]

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Regulatory proposals and long-term responses

Further information: Obama financial regulatory reform plan of 2009, Regulatory responses to the subprime crisis, and Subprime mortgage crisis solutions debate Sony VAIO VGN-NR21E/S Battery

United States President Barack Obama and key advisers introduced a series of regulatory proposals in June 2009. The proposals address consumer protection, executive pay, bank financial cushions or capital requirements, expanded regulation of the shadow banking system and derivatives, and enhanced authority for the Federal Reserve to safely wind-down systemically important institutions, among others.[221][2

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22][223] In January 2010, Obama proposed additional regulations limiting the ability of banks to engage in proprietary trading. The proposals were dubbed “The Volcker Rule”, in recognition of Paul Volcker, who has publicly argued for the proposed changes.[224][225]

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The U.S. Senate passed a regulatory reform bill in May 2010, following the House which passed a bill in December 2009. These bills must now be reconciled. The New York Times provided a comparative summary of the features of the two bills, which address to varying extent the principles enumerated by the Obama administration.[22Sony VAIO VGN-NR21S/S Battery

6] For instance, the Volcker Rule against proprietary trading is not part of the legislation, though in the Senate bill regulators have the discretion but not the obligation to prohibit these trades.

European regulators introduced Basel III regulations for banks.[227] It increased capital ratios, limits on leverage, narrow definition of capital (to exclude subordinated debt), limit counter-party risk, and new liquidity requirements.[228] Critics argue that Basel III doesn’t address the problem of faulty risk-weightings. Sony VAIO VGN-NR21S/T Battery
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Major banks suffered losses from AAA-rated created by financial engineering (which creates apparently risk-free assets out of high risk collateral) that required less capital according to Basel II. Lending to AA-rated sovereigns has a risk-weight of zero, thus increasing lending to governments and leading to the next crisis.[2Sony  VGP-BPS13 Battery

 

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29] Johan Norberg argues that regulations (Basel III among others) have indeed led to excessive lending to risky governments (see European sovereign-debt crisis) and the ECB pursues even more lending as the solution.[230]

 

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Continuation of the financial crisis in the U.S. housing market

As of 2012, in the United States, a large volume of troubled mortgages remained in place. It had proved impossible for most homeowners facing foreclosure to refinance or modify their mortgages and foreclosure rates remained high.[235] Sony  VAIO VGP-BPS13A/B Battery

 

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Stabilization

The recession that began in December 2007 ended in June 2009, according to the U.S. National Bureau of Economic Research (NBER)[236] and the financial crisis appears to have ended about the same time. In April 2009 TIME Magazine declared “More Quickly Than It Began, The Banking Crisis Is Over.”[12]

 

Sony  VGP-BPS21A Battery The United States Financial Crisis Inquiry Commission dates the crisis to 2008.[13][14] President Barack Obama declared on January 27, 2010, “the markets are now stabilized, and we’ve recovered most of the money we spent on the banks.”[237]

 

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The New York Times identifies March, 2009 as the “nadir of the crisis” and notes that “Most stock markets around the world are at least 75 percent higher than they were then. Financial stocks, which led the markets down, have also led them up.” Nevertheless, the lack of fundamental changes in banking and financial markets, worries many market participants, including the International Monetary Fund.[238]

 

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Media coverage

The financial crises generated many articles and books outside of the scholarly and financial press, including articles and books by author William Greider, economist Michael Hudson, author and former bond salesman Michael Lewis, Kevin Phillips, and investment broker Peter Schiff. Sony  VAIO VGP-BPS13B/B Battery

In May 2010 premiered Overdose: A Film about the Next Financial Crisis,[239] a documentary about how the financial crisis came about and how the solutions that have been applied by many governments are setting the stage for the next crisis. Sony  VAIO VGP-BPS13/S Battery

The film is based on the book Financial Fiasco by Johan Norberg and features Alan Greenspan, with funding from the libertarian think tank The Cato Institute. Greenspan is responsible for de-regulating the derivatives market while chairman of the Federal Reserve.

 

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Julian Paul Assange and his WikiLeaks

 

Julian Paul Assange and his WikiLeaks

Julian Paul Assange ( /əˈsɒnʒ/ ə-sonzh; born 3 July 1971) is an Australian editor, activist, political talk show host,[4][5] computer programmer, publisher and[6][7] journalist.[8][9][10] He is best known as the editor-in-chief and founder of WikiLeaks, a media website which has published information from whistleblowers.[11][ Sony  VAIO VGN-FW21E Battery

 

12] The site acts as a conduit for worldwide news leaks, with a stated purpose of creating open governance.

Assange was a hacker-activist in his youth, before becoming a computer programmer and then becoming internationally renowned for his work with WikiLeaks.

Sony VAIO VGN-FW54M Battery [13] He has lived in several countries and has made public appearances in many parts of the world to speak about freedom of the press, censorship, and investigative journalism. He has received numerous awards and nominations, including the 2009 Amnesty International Media Award,

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Readers’ Choice for TIME magazine’s 2010 Person of the Year, the 2011 Sydney Peace Foundation gold medal and the 2011 Martha Gellhorn Prize for Journalism.[14]

Following a European Arrest Warrant and an Interpol red notice issued for Assange in relation to allegations in Sweden of rape and sexual assault, and a failed appeal in Britain against extradition to Sweden,

 

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Assange broke his bail conditions on 19 June 2012 to enter the Ecuadorian embassy in London requesting political asylum on the grounds that he was being persecuted. Ecuador granted Assange asylum on 16 August 2012.[15

 

Sony VAIO VGN-FW51 Battery] The British government has said that it will not allow safe passage out of the embassy, and will arrest him when and if he leaves the embassy, and has warned the Ecuadorian authorities of legal provisions that could allow Britain to remove the diplomatic status of the embassy building where Assange has obtained refuge.

 

Sony VAIO VGN-FW4ZTJ/HThe British government has denied that they intend to raid the embassy, and have repeatedly assured Ecuador that a raid would only be used as a last measure. [16][17][18]

Assange was born in Townsville, Queensland,[19][20] and is a “a sixth-generation Australian”.[21] His mother, Christine Ann Assange (née Hawkins),[19

 

Sony VAIO VGN-FW46M Battery was the daughter of Australian Army World War II veteran, academic, and principal of Northern Rivers College (Southern Cross University), Warren Alfred Hawkins, who was born in Sydney, New South Wales, and Norma Joan Hawkins (née Carelton), who "was a specialist in medieval literature"

 

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In an interview with Robert Manne, Assange said that his "biological father" is named John Shipton, and that they did not meet "until he was 25". Manne writes: "strangely and perhaps revealingly, it [WikiLeaks] was registered under the names of two fathers, his biological one, John Shipton, and his cypherpunk political one, John Young, a New York architect who ran the intelligence leak website Cryptome,

 

Sony VAIO VGN-FW21ZR which could be seen as WikiLeaks’ predecessor.”[24][28][29][30] John Shipton is also referred to as an “architect” and an “Australian citizen living in Kenya”, who resided in Nairobi, Kenya in 2008 at the same time as Assange.[31][32][33] He “met Assange’s mother, Christine,

 

Sony VAIO VGN-FW21J Battery then aged 17, at an antiques shop on his way to a Vietnam war demonstration … little is known about the relationship, except that it had ended by the time of their son’s first birthday – if not earlier”; Shipton “never took up residence or if he did only took up residence for a very short time” and “had no contact with [Assange]“.[34] Sony  VAIO VGN-FW21I Battery

 

His mother, Christine, married theatre director Richard Brett Assange, son of George Franklin Assange and Patricia Lavinia Assange (née Glasson), when Julian was one year old.[2][35][36][37][38] The name Assange is an anglicization of “Ah Sang”, Cantonese for “Mr. Sang”.

 

Sony VAIO VGN-FW21ER Battery In 1976, the family moved to Magnetic Island, where Christine had previously resided. They lived in Horseshoe Bay, on an old, abandoned pineapple farm.[44] Later, Assange and his mother lived in a cottage at Picnic Bay.

 

 

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Youth

During Assange’s upbringing Brett and Christine Assange ran a touring theatre company. In the mid-1970s, Assange and his parents moved to North Lismore, New South Wales, and Assange attended Goolmangar Primary School in the nearby town of Goolmangar from 1979 to 1983.[45]

In 1979, his mother remarried “Leif Meynall – or Leif Hamilton”;[4

 

Sony VAIO VGN-FW11ZRU Battery6] her new husband was a musician whom Assange believed belonged to a New Age group called The Family, led by Yoga teacher Anne Hamilton-Byrne. The couple had a son, but broke up in 1982 and engaged in a custody struggle for Assange’s half-brother. His divorced mother fled her boyfriend and travelled across Australia, taking both children into hiding for the next five years.

Sony  VAIO VGN-FW31J BatteryAssange moved thirty times before he turned 14, attending many schools, including Goolmangar Primary School, sometimes being home-schooled.[2][47][48] In an interview conducted by Hans Ulrich Obrist, Assange stated that he had lived in 50 different towns and attended 37 different schools.[49]

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When questioned by Robert Manne, he clarified that the 37 schools he has attended include those he attended for only a single day. Manne reported a statement that Assange had been officially enrolled in 12 of those schools. He and his mother “by the time he was 16 or 17″ lived in “a tiny cement bungalow in the foothills of the Dandenong Ranges, east of Melbourne”,Sony  VAIO VGN-FW21L Battery

 

Victoria, first in the town of “Emerald and then Tecoma”, now in the outer eastern suburbs of Melbourne.[50][51]

“Mendax” and the Nortel case

In 1987, after turning 16, Assange began hacking under the name “Mendax” (derived from a phrase of Horace: “splendide mendax”, or “nobly untruthful”).[2] He and two other hackers joined to form a group they named the International Subversives. Assange wrote down the early rules of the subculture:

  Sony  VAIO VGN-FW21M Battery“Don’t damage computer systems you break into (including crashing them); don’t change the information in those systems (except for altering logs to cover your tracks); and share information.”[2] The Personal Democracy Forum said he was “Australia’s most famous ethical computer hacker”.[52] Sony  VAIO VGN-FW21Z Battery

 

The Australian Federal Police became aware of this group and set up “Operation Weather” to investigate their hacking. In September 1991, Mendax was discovered in the act of hacking into the Melbourne master terminal of Nortel, the Canadian telecommunications company.[2]

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In response the Australian Federal Police tapped Assange’s phoneline and subsequently raided his Melbourne home in 1991.[53] He was also reported to have accessed computers belonging to an Australian university,[2]

 

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the USAF 7th Command Group in the Pentagon[54] and other organisations, via modem.[55] It took three years to bring the case to court, where he was charged with 31 counts of hacking and related crimes. Nortel said that his incursions cost them more than $100,000. Assange’s lawyers represented his hacking as a victimless crime.

SONY VGN-FW41J/H BATTERY In May 1995 he pleaded guilty to 25 charges of hacking, after six charges were dropped, and was released on bond for good conduct with a fine of A$2,100.[2][56][57] SONY VGN-FW41E/H BATTERY

The judge said “there is just no evidence that there was anything other than sort of intelligent inquisitiveness and the pleasure of being able to—what’s the expression—surf through these various computers”[2] and stated that Assange would have gone to jail for up to 10 years if he had not had such a disrupted childhood.[54] Sony VAIO VGN-FW56E Battery

 

 

In 2011, court records revealed that, in 1993, Assange helped the Victoria Police Child Exploitation Unit by providing technical advice and assisted in prosecuting persons.[58]

Marriage and child custody issues

In 1988–1989, Assange married, then moved out and started living with his wife,[clarification needed] after they had a son,

Sony VAIO VGN-FW54M BatteryDaniel Assange.[24][59] They split up before the period of Assange’s arrest and conviction. They subsequently engaged in a lengthy custody struggle and did not agree on a custody arrangement until 1999.[2][60]

 

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The entire process prompted Assange and his mother to form Parent Inquiry Into Child Protection, an activist group centred on creating a “central databank” for otherwise inaccessible legal records related to child custody issues in Australia.[6

 

Sony VAIO VGN-FW54S Battery0] In an interview with ABC Radio, his mother explained their “most important” issue was demanding “that there be direct access to the children’s court by any member of the public for an application for protection for any child that they believe is at serious risk from abuse, where the child protection agency has rejected that notification.”[61] Sony VAIO VGN-FW56J Battery

 

Assange also has a daughter.[62][63][64]

Computer programming and other employment

 

In 1993, Assange was involved in starting one of the first public internet service providers in Australia, Suburbia Public Access Network.[6][65][66] Starting in 1994, he lived in Melbourne, where he worked on developing free software and programming.[56] In 1995, he wrote Strobe, the first free and open source port scanner.[67][6

Sony VAIO VGN-FW54J Battery8] He contributed several patches to the PostgreSQL project in 1996.[69][70] He helped to write the book Underground: Tales of Hacking, Madness and Obsession on the Electronic Frontier (1997), which credits him as a researcher and reports his history with International Subversives.[

 

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1][72] Starting around 1997, he co-invented the Rubberhose deniable encryption system, a cryptographic concept made into a software package for Linux designed to provide plausible deniability against rubber-hose cryptanalysis; 7

 

Sony VAIO VGN-FW46Z Battery [73] he originally intended the system to be used “as a tool for human rights workers who needed to protect sensitive data in the field.”[74] Other free software that he has authored or co-authored includes the Usenet caching software NNTPCache[75] and Surfraw, a command-line interface for web-based search engines. In 1998, “Assange co-founded his first and only Australian company,

Sony VAIO VGN-FW46S Battery Earthmen Technology”.[44] Assange was characterised as a “cryptographer” in a Suelette Dreyfus article published in The Independent, 15 November 1999 – “This is just between us (and the spies)”, and was said to have been the moderator of “the online Australian discussion forum AUCRYPTO”,

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and during this time Assange claimed to have found a new patent relating to the US National Security Agency’s technology for monitoring calls, “while investigating NSA capabilities”. Assange said that “this patent should worry people. Everyone’s overseas phone calls are or may soon be tapped,

 

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transcribed and archived in the bowels of an unaccountable foreign spy agency”.[76] In 1999, he registered the domain leaks.org, but he says he “didn’t do anything with it.”[77]

University studies

 

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From 2002 to 2005, Assange attended the University of Melbourne and the University of Canberra as an undergraduate student. He started a Bachelor of Science degree, studying physics, pure mathematics and, briefly, philosophy and neuroscience, but he did not graduate.[47][52][78]

                                                                               

Sony VAIO VGN-NW24MG Battery [79] There are four passing grades in the Australian university system — “pass”, “credit” or “merit”, “distinction” and “high distinction”; in most of his maths courses, he received “pass” (50-65%).[80] The fact that his fellow students were doing research for the Pentagon’s DARPA was reportedly a factor in motivating him to drop out and start WikiLeaks.[2][47][79]

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Career as head of WikiLeaks

 

 

 

Assange, in or before 2006

Main article: WikiLeaks

WikiLeaks was founded in 2006.[2][81] That year, Assange wrote two essays setting out the philosophy behind WikiLeaks: “To radically shift regime behaviour we must think clearly and boldly for if we have learned anything, Sony VAIO VGN-NW24EG Battery it is that regimes do not want to be changed. We must think beyond those who have gone before us and discover technological changes that embolden us with ways to act in which our forebears could not.”[82][83][84

 

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] In his blog he wrote, “the more secretive or unjust an organization is, the more leaks induce fear and paranoia in its leadership and planning coterie…. Since unjust systems, by their nature, induce opponents, and in many places barely have the upper hand, mass leaking leaves them exquisitely vulnerable to those who seek to replace them with more open forms of governance.”[82][85]

 

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Assange is the most prominent media spokesman on WikiLeaks’ behalf. In June 2010, he was listed alongside several others as a member of the WikiLeaks advisory board.[86][87] While newspapers have described him as a “director”[88] or “founder”[53] of WikiLeaks, Assange has said, “I don’t call myself a founder”;[8

 

Sony VAIO VGN-SR51MF/P Battery9] he does describe himself as the editor in chief of WikiLeaks,[90] and he has stated that he has the final decision in the process of vetting documents submitted to the site.[91] Assange says that WikiLeaks has released more classified documents than the rest of the world press combined: “That’s not something I say as a way of saying how successful we are – rather,

 

Sony VAIO VGN-SR41M/S Batterythat shows you the parlous state of the rest of the media. How is it that a team of five people has managed to release to the public more suppressed information, at that level, than the rest of the world press combined? It’s disgraceful.”[81] He advocates a “transparent” and “scientific” approach to journalism, saying that “you can’t publish a paper on physics without the full experimental data and results;

Sony VAIO VGN-SR41M/P Battery that should be the standard in journalism.”[92][93] In 2006, CounterPunch called him “Australia’s most infamous former computer hacker.”[94] The Age has called him “one of the most intriguing people in the world” and “internet’s freedom fighter.”[77] Assange has called himself “extremely cynical”.[77]

 

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He has been described as being largely self-taught and widely read on science and mathematics,[56] and as thriving on intellectual battle.[95]

WikiLeaks has been involved in the publication of material documenting extrajudicial killings in Kenya, a report of toxic waste dumping on the coast of Côte d’Ivoire, Church of Scientology manuals, Guantanamo Bay procedures,

Sony VAIO VGN-SR29VN Battery the 12 July 2007 Baghdad airstrike video, and material involving large banks such as Kaupthing and Julius Baer among other documents.[96] In 2008, Assange published an article entitled “The Hidden Curse of Thomas Paine”,

Sony VAIO VGN-SR21M/S Battery in which he wrote “What does it mean when only those facts about the world with economic powers behind them can be heard, when the truth lays naked before the world and no one will be the first to speak without payment or subsidy?”[97] Sony VAIO VGN-SR11M Battery

 

 

Public appearances and residency

Though an Australian citizen, Assange has not lived in Australia since he left after starting to work on WikiLeaks.[7] In 2007 Assange moved to Nairobi, Kenya, he then also spent time in Tanzania, stayed in Cairo, Egypt for a week,[98

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] Paris, France and Wiesbaden, Germany for two months at the end of 2008,[99] He appeared at a hacker conference, the 25th and 26th Chaos Communication Congress in Germany[100] He was in Linz, Austria for the Ars Electronica in September 2009[10

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1] and Barcelona, Spain for the Personal Democracy Forum in November 2009.[102][103][104][105] and at a media conference, New Media Days ’09, in Copenhagen, Denmark.[106] He began renting a house in Iceland on 30 March 2010, from which he and other activists, including Birgitta Jónsdóttir, worked on the Collateral Murder video.[2] He was in San Francisco, California, United States,

                                                                                                         

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for the Logan Symposium in Investigative Reporting at the UC Berkeley Graduate School of Journalism in April 2010, then in Oslo, Norway for the Oslo Freedom Forum from 26 to 29 April, before he returned to Australia in June 2010.[107

Sony VAIO VGN-SR19VN Battery108][109][110] On 21 June 2010, he took part in a hearing in Brussels, Belgium, appearing in public for the first time in nearly a month.[111] He was a member on a panel that discussed Internet censorship and expressed his worries over the recent filtering in countries such as Australia. ][ Sony VAIO VGN-SR11MR Battery

He also talked about secret gag orders preventing newspapers from publishing information about specific subjects and even divulging the fact that they are being gagged. Using an example involving The Guardian, he also explained how newspapers are sometimes altering their online archives by removing entire articles.[112][11

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3] He told The Guardian that he does not fear for his safety but is on permanent alert and will avoid travel to America, saying “[US] public statements have all been reasonable. But some statements made in private are a bit more questionable.” He said “politically it would be a great error for them to act. I feel perfectly safe but I have been advised by my lawyers not to travel to the US during this period.”[111]

 

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On 17 July 2010, Jacob Appelbaum spoke on behalf of WikiLeaks at the Hackers on Planet Earth (HOPE) conference in New York City, replacing Assange due to the presence of federal agents at the conference.[114][115] He announced that the WikiLeaks submission system was again up and running, after it had been temporarily suspended.[114]

 

Sony VGP-BPS21B Battery [116] Assange was a surprise speaker at a TED conference on 19 July 2010 in Oxford and confirmed that WikiLeaks was now accepting submissions again.[117][118][119] On 26 July, after the release of the Afghan War Diary, he appeared at the Frontline Club for a press conference.[120]

 

Sony VGP-BPS21A Battery Later in July 2010 he was in London, United Kingdom, then in August in Stockholm, Sweden, before returning to London, where he was imprisoned.[121]

In the first half of 2010, he appeared on Al Jazeera English, MSNBC, Democracy Now!, RT and The Colbert Report to discuss the release of the Baghdad airstrike video by WikiLeaks. On 3 June he appeared via videoconferencing at the Personal Democracy Forum conference with Daniel Ellsberg.[122][123]

 

Sony VGP-BPS21 Battery Ellsberg told MSNBC “the explanation he [Assange] used” for not appearing in person in the US was that “it was not safe for him to come to this country.”[124] On 11 June he was to appear on a showcase panel at the Investigative Reporters and Editors conference in Las Vegas,[125] but there are reports that he cancelled several days prior.[126] Sony VGP-BPS13/B Battery

 

On 10 June 2010, it was reported that Pentagon officials were trying to determine Assange’s whereabouts.[127][128] Based on this, there were reports that US officials wanted to apprehend him.[129] Ellsberg said that the arrest of Bradley Manning and subsequent speculation by US officials about what Assange may be about to publish “puts his well-being, his physical life, in some danger now.”[124]

 

Sony VGP-BPS13B/Q BatteryIn The Atlantic, Marc Ambinder called Ellsberg’s concerns “ridiculous” and said that “Assange’s tendency to believe that he is one step away from being thrown into a black hole hinders, and to some extent discredits, his work.”[130]

Sony VGP-BPS13A/Q Battery On Salon.com, Glenn Greenwald questioned “screeching media reports” that there was a “manhunt” on Assange underway, arguing that they were only based on comments by “anonymous government officials” and might even serve a campaign by the US government, by intimidating possible whistleblowers.[citation needed]

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In October 2010, his application for a residency permit was denied in Sweden.[131]

On 4 November 2010, Assange told Swiss public television TSR that he was seriously considering seeking political asylum in neutral Switzerland and moving the operation of the WikiLeaks foundation there.[132]

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In late November 2010, Kintto Lucas, the Deputy Foreign Minister of Ecuador, spoke about giving Assange residency with “no conditions… so he can freely present the information he possesses and all the documentation,

                                                                                                                                        

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not just over the Internet but in a variety of public forums”.[133] Lucas believed that Ecuador may benefit from initiating a dialogue with Assange.[134] Foreign Minister Ricardo Patiño stated on 30 November that the residency application would “have to be studied from the legal and diplomatic perspective”.[135]

Sony VGP-BPS13A/B Battery A few hours later, President Rafael Correa stated that WikiLeaks “committed an error by breaking the laws of the United States and leaking this type of information… no official offer was [ever] made.”[136][137] Sony VGP-BPS13B/B Battery

Correa noted that Lucas was speaking “on his own behalf”; additionally, he will launch an investigation into possible ramifications Ecuador would suffer from the release of the cables.[137]

In December 2010, it was reported that US Ambassador to Switzerland Donald S. Beyer had warned the Swiss government against offering asylum to Assange, citing the arrest warrant issued by Interpol.[138]

 

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In a hearing at the City of Westminster Magistrates’ Court on 7 December 2010, Assange identified a post office box as his address. When told by the judge that this information was not acceptable, he submitted “Parkville, Victoria, Australia” on a sheet of paper. His lack of permanent address and nomadic lifestyle were cited by the judge as factors in denying bail.[139] He was ultimately released,

Sony Vaio VGN-FW56SR Battery in part because journalist Vaughan Smith offered to provide Assange with an address for bail during the extradition proceedings, Smith’s Norfolk mansion, Ellingham Hall.[140] He lived there for a year, then moved out in December 2011 to a “3,000-acre estate in East Sussex” – “a lodge on Lord Abergavenny’s Eridge Park estate, near Tunbridge Wells”.[141][142]

 

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On 14 February 2011, Assange filed for the trademark “JULIAN ASSANGE” in Europe. The trademark is to be used for “public speaking services; news reporter services; journalism; publication of texts other than publicity texts; education services; entertainment services”.[143] On 15 March 2011, Assange gave a speech at the Cambridge Union Society.[144][145] [146]

 

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On 19 February 2012 the 500th episode of The Simpsons, “At Long Last Leave”, was aired, which features Assange guest-starring as himself in a scene written by Australian author Kathy Lette, the wife of Assange’s adviser Geoffrey Robertson QC.[147][148] Sony Vaio VGN-SR49VN/H Battery

 

Release of US diplomatic cables

Main article: United States diplomatic cables leak

On 28 November 2010, WikiLeaks began releasing some of the 251,000 American diplomatic cables in their possession, of which over 53 percent are listed as unclassified, 40 percent are “Confidential” and just over six percent are classified “Secret”. The following day, the Attorney-General of Australia, Robert McClelland,

Sony Vaio VGN-SR59VG/H Batterytold the press that Australia would inquire into Assange’s activities and WikiLeaks.[149] He said that “from Australia’s point of view, we think there are potentially a number of criminal laws that could have been breached by the release of this information. The Australian Federal Police are looking at that”.[150

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] McClelland would not rule out the possibility that Australian authorities will cancel Assange’s passport, and warned him that he might face charges should he return to Australia.[151] The Federal Police inquiry found that Assange had not committed any crime.[152] Sony Vaio VGN-FW56Z Battery

 

 

The United States Department of Justice launched a criminal investigation related to the leak. US prosecutors are reportedly considering charges against Assange under several laws, but any prosecution would be difficult.[153]

Sony Vaio VGN-SR57X Battery In relation to its ongoing investigations of WikiLeaks, on 14 December 2010, the US Department of Justice issued a subpoena ordering Twitter to release information relating to Assange’s account, amongst others.[154][155]

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The WikiLeaks diplomatic cable revelations have been credited by some commentators with being a factor in sparking the Tunisian Revolution, as such leaked cables revealed the degree of corruption in the then ruling government. Writing for Foreign Policy magazine, journalist Elizabeth Dickinson suggested that “Tunisians didn’t need any more reasons to protest when they took to the streets these past weeks – food prices were rising, corruption was rampant, Sony Vaio VGN-SR57S Battery and unemployment was staggering. But we might also count Tunisia as the first time that WikiLeaks pushed people over the brink…”[156][157]

Financial developments

On 6 December 2010, the Swiss bank PostFinance announced that it had frozen assets of Assange’s totalling 31,000 euros, because he had “provided false information regarding his place of residence” when opening the account.[158] Sony VPCF2 Battery

 

MasterCard,[159] Visa Inc.,[160] and Bank of America[161] also halted dealings with WikiLeaks. Assange described these actions as “business McCarthyism”.[162] The English-language Swedish newspaper website “Local” quoted Assange on 27 December 2010 as saying that legal costs for the whistleblowing website and his own defence had reached £500,000. Sony VPCF11C4E/B Battery

The decisions to halt donations to WikiLeaks by Visa, MasterCard and PayPal had cost £425,000, the same amount it costs the website to publish for six months. Assange said WikiLeaks had been receiving as much as £85,000 a day at its peak, before the financial blockade.[163] Sony VPCF11C5E Battery

 

Autobiography

In December 2010, Assange sold the publishing rights[164] to his proposed autobiography for over £1 million. He told The Sunday Times that he was forced to enter the deal for an autobiography because of the financial difficulties he and the site encountered, stating “I don’t want to write this book,

 

Sony VPCF11S1E Battery but I have to. I have already spent £200,000 for legal costs and I need to defend myself and to keep WikiLeaks afloat.”[165]

A draft of this work was published, without Assange’s consent, in September 2011. The book was ghostwritten by Andrew O’Hagan and was given the title Julian Assange – The Unauthorised Autobiography (2011). Assange and the publisher, Canongate, gave differing accounts of the circumstances surrounding the publication.[166][167] Sony VPCF11D4E Battery

 

Allegations of possible extradition to the United States

There was an indication of subpoena by a grand jury served to an individual linked to WikiLeaks in relation to the Espionage Act (18 U.S.C. 793) due to Guantanamo Bay files leak and also focuses on Bradley Manning.

 

Sony VPCF24M1E Battery The subpoena is investigating those who helped Bradley Manning release classified diplomatic cables under 18 U.S.C. 371. Another charge is those that “embezzle, steal, purloin, or knowingly convert … any record, voucher, money, or thing of value of the United States.” under 18 U.S.C. 641. The charges strongly indicate a criminal investigation against WikiLeaks.[168] Sony VPCF11M1E/H Battery

 

Stratfor’s emails leaked by WikiLeaks have discussions surrounding a secret grand jury[169] with a secret indictment.[170] Later, a media organisation received declassified diplomatic cables that confirm a secret indictment exists.

Sony VPCF23S1E BatteryThe documents go on to state that Australia has no objection to a potential extradition to the United States. The Australian government confirmed the possibility of extradition but stated that it wasn’t unusual as there was an ongoing investigation about Wikileaks. They point out that the United States may not be intent on extraditing Assange.[171]

 

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Support and criticism around the world

Comments by the Australian government

The publication of Australian government briefings after a Senate request showed the government had privately discussed charging Assange with treason, which they never mentioned publicly.[172]

 

Sony VPCF23Q1E BatteryJulia Gillard stated that Assange’s actions were “illegal”, which was later retracted when an Australian Federal Police commission determined he had not broken any Australian laws. They also found no grounds to withdraw his Australian passport after an investigation by the Australian Federal Police. Since then, government representatives and the major opposition,

 

Sony VPCF23M1E Battery including Craig Emerson, the Minister for Trade, and Helen Coonan, the former minister for Communications, have made statements supportive of WikiLeaks and deprecated some threats. Emerson stated on ABC’s Q&A program; “We condemn absolutely the threats that have been made by some people in the United States against Julian Assange and he deserves all of the rights of being an Australian citizen.”[173] Sony VPCF11S1E/B Battery

 

These supportive statements by the Australian government have complicated Assange’s attempts to seek political asylum. Under international legal principles,[clarification needed] refugees must have a “well-founded fear of being persecuted” in their home country.[174] Sony VPCF115FG/B Battery

 

Support from Australians

 

 

Demonstration in support of Assange in front of Sydney Town Hall, 10 December 2010.

The Prime Minister of Australia, Julia Gillard, has come under widespread condemnation and a backlash within her own party for failing to support Assange after calling the leaks “an illegal act” and suggesting that his Australian passport should be cancelled. Sony VPCF21Z1E Battery

Hundreds of lawyers, academics and journalists came forward in his support with the Attorney-General, Robert McClelland, unable to explain how Assange had broken Australian law. Opposition Legal Affairs spokesman, Senator George Brandis,

Sony VPCF22S8E Batterya Queen’s Counsel, accused Gillard of being “clumsy” with her language, stating, “As far as I can see, he (Assange) hasn’t broken any Australian law, nor does it appear he has broken any American laws.”[175]

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The former Foreign Minister, Kevin Rudd, who supports Assange,[citation needed] said that any decision to cancel the passport would be his, not Gillard’s.

Queen’s Counsel Peter Faris, who acted for Assange in a hacking case 15 years ago, said that the motives of Swedish authorities in seeking Assange’s extradition for alleged sex offences are suspect: “You have to say: why are they (Sweden) pursuing it?

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It’s pretty obvious that if it was Bill Bloggs, they wouldn’t be going to the trouble.”[176] Following the Swedish Embassy issuing of a “prepared and unconvincing reply” in response to letters of protest, Gillard was called on to send a message to Sweden “querying the way charges were laid, investigated and dropped, only to be picked up again by a different prosecutor.” Sony VPCF22J1E Battery

 

On 10 December 2010, over 500 people rallied outside Sydney Town Hall and about 350 people gathered in Brisbane, Queensland[180] where Assange’s lawyer, Rob Stary, criticised Julia Gillard’s position, telling the rally that the Australian government was a “sycophant” of the United States. A petition circulated by GetUp! Sony VPCF22L1E Battery

, which has placed full page ads in support of Assange in The New York Times and The Washington Times, received more than 50,000 signatures.[178]

American response to Afghan war logs

Despite withholding some 15,000 incident reports for “safety reasons,” thousands of documents in the Wikileaks Afghan war log do identify Afghans by name, family, location, and ideology. The Taliban issued a warning to Afghans, Sony VPCF13E4E Battery

 

alleged in the log to have worked as informers for the NATO-led coalition, that “US spies” will be hunted down and punished, indicating they will investigate the named individuals before deciding on their fate.[181]

 

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Asked what he thought of the dangers to those families created by the release of their personal information, Assange claimed that many informers in Afghanistan were “acting in a criminal way” by sharing false information with NATO authorities. He insisted that any risk to informants’ lives was outweighed by the overall importance of publishing the information.[181] Sony VPCF13E8E Battery

 

Current and former US government officials have accused Assange of terrorism. When asked if he saw Assange more as a high-tech terrorist or as a whistleblower, like those who released the Pentagon papers in the 1970s,

 

Sony VPCF23QIE BatteryUS Vice President Joe Biden said: “I would argue it is closer to being a high-tech terrorist than the Pentagon papers.”[182] In May 2010, Senate Minority Leader Mitch McConnell had used the phrase, calling Assange “a high-tech terrorist”, and saying “he has done enormous damage to our country. I think he needs to be prosecuted to the fullest extent of the law”.[183

 

Sony VPCF24Q1E Battery] Also in May 2010, former House Speaker Newt Gingrich said: “Information terrorism, which leads to people getting killed, is terrorism, and Julian Assange is engaged in terrorism. He should be treated as an enemy combatant.”[184] Sony VPCF13J0E/H Battery

 

In July 2010, after WikiLeaks released classified documents related to the war in Afghanistan, Chairman of the US Joint Chiefs of Staff, Mike Mullen, said at a Pentagon news conference, “Disagree with the war all you want, take issue with the policy, challenge me or our ground commanders on the decisions we make to accomplish the mission we’ve been given,

 

Sony VPCF21Z1E/BI Battery but don’t put those who willingly go into harm’s way even further in harm’s way just to satisfy your need to make a point. Mr. Assange can say whatever he likes about the greater good he thinks he and his source are doing, but the truth is, they might already have on their hands the blood of some young soldier or that of an Afghan family.” Assange responded later in an interview by saying,

 

Sony VPCF13M1E/H Battery “There is, as far as we can tell, no incident of that. So it is a speculative charge. Of course, we are treating any possible revelation of the names of innocents seriously. That is why we held back 15,000 of these documents, to review that”. Assange also claimed it was ‘ironic’ of US officials and military leaders to accuse him of having blood on his hands.[185]

 

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On 30 November 2010, former Vice-Presidential candidate Sarah Palin called for Assange to be “hunted down like Bin Laden”.[186]

Calls for Assange’s assassination

On 30 November 2010, Tom Flanagan, a former aide to the Canadian prime minister, Stephen Harper, called for Assange’s assassination. Mr. Flanagan later retracted his comments, after a Vancouver lawyer filed a complaint with the Calgary Police against Harper,[187] and Canadian nationals filed complaint with the ombudsman of CBC news.[188] Sony VPCF1318E/H Battery    

 

On 1 December 2010, Republican Mike Huckabee called for those behind the leak of the cables to be executed,[189] a view partly supported by Kathleen McFarland, former Pentagon advisor under Nixon, Ford and Reagan[190] and current Fox News national security expert. Sony VPCF13M1E/B Battery

 

On 6 December 2010, during a segment of the Fox Business show Follow The Money, Fox News political commentator and analyst Bob Beckel stated, “A dead man can’t leak stuff. This guy’s a traitor,

 

Sony VPCF12S1E/B Battery he’s treasonous, and he has broken every law of the United States. [...] And I’m not for the death penalty, so [...] there’s only one way to do it: illegally shoot the son of a bitch.” Other guests on the program agreed.[191] Sony VPCF11C4E/B Battery

 

Assange responded on the Guardian newspaper website, to a reader’s question about Flanagan’s remarks, by contending that “Mr. Flanagan and the others seriously making these statements should be charged with incitement to commit murder.”[192] Sony VPCF13Z8E Battery

Members of US Congress call for Espionage Act prosecution

On 29 November 2010, Rep. Peter T. King, Chairman of the House Permanent Select Committee on Intelligence (HPSCI) wrote to the Attorney General, Eric Holder, asking that Assange should be prosecuted under the Espionage Act of 1917, and that he should be declared a terrorist.[193][194] Sony VPCF13Z8E/BI Battery

The same day, King also wrote to the Secretary of State, Hillary Clinton, requesting that she designate Wikileaks as a Foreign Terrorist Organization (FTO).[193][195][196]

“I am calling on the attorney general and supporting his efforts to fully prosecute Wikileaks and its founder for violating the Espionage Act. And I’m also calling on Secretary of State Hillary Clinton to declare Wikileaks a foreign terrorist organization”, King said on WNIS radio on Sunday evening.[197]

 

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“By doing that, we will be able to seize their funds and go after anyone who provides them help or contributions or assistance whatsoever,” he said. “To me, they are a clear and present danger to America.”

 

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On 30 November 2010, on Fox News, Rep. King repeated his assertions that Wikileaks was a terrorist organisation;[198] he continued to repeat these assertions on other news media channels for the following week.

 

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On 2 December 2010, Senator Feinstein and Senator Kit Bond, respectively the Chairman and Ranking Member of the Senate Select Committee on Intelligence (SSCI), sent a joint-letter to Attorney General Holder, asking him to prosecute Assange under the Espionage Act [18 U.S.C.

 

Sony VAIO VPCS13S8R/S Battery793(e)], offering to “close those gaps in the law” if the United States Department of Justice (DOJ) found it difficult to apply the law to Assange’s case. In televised interviews Senators Bond and Feinstein stated that:

“We believe that Mr. Assange’s conduct is espionage and that his actions fall under the elements of this section of law….Therefore, we urge that he be prosecuted under the Espionage Act.”[199]

On 7 December 2010, Senator Dianne Feinstein published an editorial commentary on Assange entitled “Prosecute Assange Under the Espionage Act”.[200]

 

Sony VAIO VPCS12E7E Battery Punishments under the Espionage Act can include the death penalty, although in practice the US has not executed anyone for a crime other than murder since 1962.[citation needed]

 

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Support in the United States

Daniel Ellsberg, who was working in the US Department of Defense when he leaked the Pentagon Papers in 1971, was a signatory to a statement by an international group of former intelligence officers and ex-government officials in support of Assange’s work, which was released in late December 2010.

 

Sony VAIO VPCS12C5E BatteryOther signatories included David MacMichael, Ray McGovern, and five recipients of annual Sam Adams Award: Frank Grevil, Katharine Gun, Craig Murray, Coleen Rowley and Larry Wilkerson.[201

 

Sony VAIO VPCS12B7E Battery] Ellsberg has said, “If I released the Pentagon Papers today, the same rhetoric and the same calls would be made about me … I would be called not only a traitor – which I was [called] then, which was false and slanderous – but I would be called a terrorist… Assange and Bradley Manning are no more terrorists than I am.”[202]

 

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Response from other countries and the United Nations

Luiz Inacio Lula da Silva, then president of Brazil, expressed his “solidarity” with Assange following his 2010 arrest in the United Kingdom.[203][204] He further criticised the arrest of Assange as “an attack on freedom of expression”.[205]

 

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Vladimir Putin, the President of Russia, condemned Assange’s detention as “undemocratic”.[177] A source within the office of Russian President, suggested that Assange be nominated for a Nobel Prize and said that “Public and non-governmental organisations should think of how to help him.”[206]

 

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In December 2010, the United Nations’ Special Rapporteur for Freedom of Opinion and Expression, Frank LaRue, said that Assange or other WikiLeaks staff should not face criminal charges for any information they disseminated, noting that “if there is a responsibility by leaking information it is of, exclusively of the person that made the leak and not of the media that publish it. And this is the way that transparency works and that corruption has been confronted in many cases.”[207]

 

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Professional status

 

Assange has been a member of the Australian journalist union, the Media, Entertainment and Arts Alliance, for several years, and in 2011, was made an honorary member.[208][209] Alex Massie wrote an article in The Spectator called “Yes, Julian Assange is a journalist”, but acknowledged that “newsman” might be a better description of Assange.[8] Alan Dershowitz said “Without a doubt. He is a journalist,

 

Sony VAIO VPCS11M1E/W Batterya new kind of journalist”.[210] Assange has said that he has been publishing factual material since age 25, and that it is not necessary to debate whether or not he is a journalist. He has stated that his role is “primarily that of a publisher and editor-in-chief who organises and directs other journalists”.[211] He has been described as a journalist by the Centre for Investigative Journalism.[9]

 

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Awards

 

Assange received the 2009 Amnesty International UK Media Award (New Media),[212] for exposing extrajudicial assassinations in Kenya by distributing and publicizing the Kenya National Commission on Human Rights (KNCHR)’s investigation Kenya: The Cry of Blood – Extra Judicial Killings and Disappearances.[213][214][

 

Sony VAIO VPCS11G7E Battery10] Accepting the award, Assange said, “It is a reflection of the courage and strength of Kenyan civil society that this injustice was documented.”[215]

In 2010, Assange was awarded the Sam Adams Award,[216][217] Readers’ Choice in TIME magazine’s Person of the Year poll,[14] and runner-up for Person of the Year.[218] In April 2011 he was listed on the Time 100 list of most influential people.[219

 

Sony VAIO VPCS11F7E Battery] An informal poll of editors at Postmedia Network named him the top newsmaker for the year after six out of 10 felt Assange had “affected profoundly how information is seen and delivered”.[220]

 

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Le Monde, one of the five publications to cooperate with WikiLeaks’ publication of the recent document leaks, named him person of the year with fifty six percent of the votes in their online poll.[221][222][223]

 

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In February 2011, it was announced that Assange had been awarded the Sydney Peace Foundation gold medal by the Sydney Peace Foundation of the University of Sydney for his “exceptional courage and initiative in pursuit of human rights.”[224] There have been four recipients of the award in the foundation’s fourteen year history: Nelson Mandela; the 14th Dalai Lama, Tenzin Gyatso; Daisaku Ikeda; and Assange.[224]
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In June 2011, Assange was awarded the Martha Gellhorn Prize for Journalism. The prize is awarded on an annual basis to journalists “whose work has penetrated the established version of events and told an unpalatable truth that exposes establishment propaganda, or ‘official drivel’”. The judges said, “WikiLeaks has been portrayed as a phenomenon of the hi-tech age, which it is. But it’s much more. Its goal of justice through transparency is in the oldest and finest tradition of journalism.”[225]

 

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Snorre Valen, a Norwegian parliamentarian, told media he had proposed him for the 2011 Nobel Peace Prize.[226]

In November 2011, he was awarded the 2011 Walkleys Award in the category Most Outstanding Contribution to Journalism. The annual Walkley Awards honour excellence in journalism and the Most Outstanding Contribution to Journalism, awarded since 1994, recognises commitment and achievement in the Australian media. [227][228] Sony VAIO VGN-FW51 Battery

 

Allegations of sexual assault

 

Main article: Assange v The Swedish Prosecution Authority

In 2010, a European Arrest Warrant was issued for Assange in response to a Swedish police request for questioning in relation to a sexual assault investigation. Assange voluntarily attended a police station in England on 7 December 2010, Sony VAIO VGN-FW51ZF/H Battery

 

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Sony VAIO VGN-FW56 Battery and was arrested and taken into custody. After ten days in Wandsworth prison, Assange was freed on bail with a residence requirement at Ellingham Hall in Norfolk, England, fitted with an electronic tag and ordered to report to police daily. Assange appealed a February 2011 decision by English courts to extradite him to Sweden, saying the allegations were “without basis”.[229]

 

Sony VAIO VGN-FW54J Battery [230] On 2 November 2011 the High Court upheld the extradition decision and rejected all four grounds of appeal presented by Assange’s legal representatives. Costs of £19000 were also awarded against Assange.

On 20 August 2010, Swedish police began an investigation into allegations concerning Assange’s behaviour in separate sexual encounters involving two different women.[231][232] Assange has described all the sexual encounters as consensual.[233][ Sony VAIO VGN-FW51MF/H Battery

234] The arrest warrant was canceled on 21 August 2010 by one of Stockholm’s chief prosecutors, Eva Finne, as the investigation was downgraded to only cover lesser charges, and re-issued by Swedish Director of Prosecution Marianne Ny on 1 September 2010 who considered that the allegations could be classed as rape.[2

 

Sony VAIO VGN-FW54E Battery35] In December 2010, Assange, then in Britain, learned that the Swedish authorities had issued a European Arrest Warrant (EAW) to extradite him to Sweden for questioning.

According to published reports, the charges Sweden has lodged against Assange involve two different women. Their initial intention was reportedly to force Assange to take an HIV test. There are four charges:

 

Sony VAIO VGN-FW46Z Battery that on 14 August 2010 he committed “unlawful coercion” when he held complainant 1 down with his body weight in a sexual manner; that he “sexually molested” complainant 1 when he had condom-less sex with her after she insisted that he use one; Sony VAIO VGN-FW56M Battery

that he had condom-less sex with complainant 2 on the morning of 17 August while she was asleep; and that he “deliberately molested” complainant 1 on 18 August 2010 by pressing his erect penis against her body.[236][237] Sony VAIO VGN-FW35F Battery

 

An extradition hearing took place on 7–8 and 11 February 2011 before the City of Westminster Magistrates’ Court[238][239] when the extradition warrant was upheld.[240][241][242][243]

On 2 March 2011, his lawyers lodged papers at the High Court challenging the ruling to extradite Assange to Sweden.[244]

 

Sony VAIO VGN-FW46S Battery After a hearing on 12 and 13 July 2011, the High Court reserved its judgment, and on 2 November 2011, dismissed his appeal.[245] On 5 December 2011 Assange’s lawyers were granted permission to appeal to the Supreme Court, after the High Court certified that a point of law of general public importance, that ought to be considered by the Supreme Court, was involved in its decision.[2

 

Sony VAIO VGN-NW26JG Battery46] The certified question was whether a prosecutor can be a judicial authority.[247][248] The Supreme Court heard argument in the appeal on 1 and 2 February 2012.[249] and reserved its judgment,[25

 

Sony VAIO VGN-NW26EG Battery0] while Assange remained on conditional bail.[244][251] On 30 May 2012 the court dismissed the appeal by a majority of 5–2.[252] The court granted Assange two weeks to make an application to reopen the appeal after his counsel argued the judgments of the majority relied on an interpretation of the Vienna Convention on the Law of Treaties which was not argued during the hearing.[253]

 

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Barring any appeal to the European Court of Human Rights in Strasbourg, extradition had been expected to take place over a ten day period commencing on 28 June 2012.[254]

Assange’s lawyer in Britain, Mark Stephens claimed the charges in Sweden are just a ‘holding case’ while the US prepares its prosecution over Wikileak’s activities. He said Assange could face extradition or illegal rendition to the US from Sweden where he could be detained in a high-security prison and face the death penalty. Stephens said he believed Swedish officials were cooperating with US authorities.[255]

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Request for political asylum in Ecuador

 

 

The Ecuadorian Embassy in London, 16 August 2012

On 19 June 2012, the Ecuadorian foreign minister, Ricardo Patiño, announced that Assange had applied for political asylum and that the Ecuadorian government was analysing his request. He also told local media that Assange was in the Ecuadorian Embassy in London.[256Sony VAIO VGN-NW24S Battery

 

][257] The Metropolitan Police Service stated that he was in breach of one of the conditions of his bail and could therefore be lawfully arrested.[258] Ecuador was required by international law to consider his application, but some extradition experts contended that he might have to show that he was being persecuted in his home country, Australia.[259

Sony VAIO VGN-NW24JG Battery][260] On 23 June, Rafael Correa, President of Ecuador, recalled his Ambassador to the UK back to Quito, to discuss the situation.[261] On 24 June, Assange said he would go to Sweden if provided with a diplomatic guarantee that he would not be turned over to the US.[262]

 

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On 15 August, Ecuadorian foreign minister Ricardo Patiño stated that Britain threatened to storm his country’s London embassy to arrest Assange.[263][264] At a press conference Patiño said, “Such actions would be a blatant disregard of the Vienna Convention on Diplomatic Relations and of the rules of international law of the past four centuries. It would be a dangerous precedent because it would open the door to the violation of embassies as a declared sovereign space.”[265]

 

Sony VAIO VGN-FW56J BatteryThe UK’s position was that it was simply informing Ecuador of the legal position in the UK under the Diplomatic and Consular Premises Act 1987, which allows the UK government to determine what land is considered to be diplomatic or consular premises. Sony VAIO VGN-NW26M Battery

Sony VAIO VGN-FW56E BatteryThe 1987 Act permits the revocation of diplomatic status of a building if the foreign power occupying it “ceases to use land for the purposes of its mission or exclusively for the purposes of a consular post…if doing so [the revocation] is permissible under international law”.

 

Sony Vaio VGN-SR49VT/H Battery However, section 1(5) arguably limits loss of diplomatic status to “material considerations, and in particular” to public safety, national security and town and country planning. Lawyers for Ecuador could argue that sheltering Assange is not a material consideration as it does not interfere with the workings of the embassy.[26Sony Vaio VGN-SR49VN/H Battery

6] Ecuadorian officials at the embassy offered to allow Swedish prosecutors to question Assange in the London embassy. However, this offer was refused by the Swedish authorities.[267] Britain and Ecuador are attempting to find a solution to their diplomatic standoff.[268]

 

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Claes Borgström, the lawyer of the two Swedish women who made allegations of sexual assault against Assange, denounced Ecuador’s move as “absurd”. Borgström told reporters that the move was an abuse of the asylum instrument, the purpose of which is to protect people from persecution and torture if sent back to one’s country of origin. Sony Vaio VGN-FW56Z Battery

“He doesn’t risk being handed over to the United States for torture or the death penalty. He should be brought to justice in Sweden,” he said. [269]

Diplomatic asylum granted

On 16 August 2012, the Ecuadorian foreign minister, Ricardo Patiño, stated in a press conference that the Ecuadorian government was granting Assange diplomatic asylum.[15] Sony Vaio VGN-SR57S Battery

Patiño cited concerns that Assange might be extradited to the US, which could conceivably lead to his execution or indefinite incarceration. Patiño claims that Sweden has refused to rule out the extradition of Assange if it were requested by the United States. Ecuador also called a meeting of the Organization of American States to gather support for its position.[270] Sony Vaio VGN-SR57V Battery

 

Sony Vaio VGN-FW56ZR BatteryThe British Foreign Office stated that it was “disappointed” at Ecuador’s decision and that it remained under a binding agreement to extradite Assange to Sweden in spite of the decision taken by Ecuador.[271] On 16 August, the British Foreign Secretary, William Hague, said that the UK will not allow Assange safe passage out of the country.[272] Rafael Correa on 18 August, said that Assange could stay at the embassy indefinitely.[273]

 

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In a speech given by Assange on 19th August 2012, from the balcony of the Ecuadorian embassy in London, Assange urged the United States to “end its witch hunt” against WikiLeaks while also referring to the imprisonment of some of the members of the Russian punk rock band, Pussy Riot quoting: [274]

 

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“There is unity in the oppression. There must be absolute unity and determination in the response”

————————————————————————————-

WikiLeaks is an international, online, self-described not-for-profit[2] organisation publishing submissions of private, secret, and classified media from anonymous news sources, news leaks, and whistleblowers[5]. Its website, launched in 2006 under the Sunshine Press organisation,[6] claimed a database of more than 1.2 million documents within a year of its launch.[7] Julian Assange, an Australian Internet activist, is generally described as its founder, editor-in-chief, and director.

Sony Vaio VGN-SR59TH/H Battery Kristinn Hrafnsson, Joseph Farrell and Sarah Harrison are the only other publicly known and acknowledged associates of Julian Assange.[9] Hrafnsson is also a member of the company Sunshine Press Productions along with Assange, Ingi Ragnar Ingason and Gavin MacFadyen.[10][11] [8] Sony Vaio VGN-SR57X Battery

The group has released a number of significant documents which have become front-page news items. Early releases included documentation of equipment expenditures and holdings in the Afghanistan war and corruption in Kenya.[12Sony VPCF11C4E/B Battery

] In April 2010, WikiLeaks published gunsight footage from the 12 July 2007 Baghdad airstrike in which Iraqi journalists were among those killed by an Apache helicopter, known as the Collateral Murder video. In July of the same year, WikiLeaks released Afghan War Diary, a compilation of more than 76,900 documents about the War in Afghanistan not previously available to the public.[13] Sony VPCF11C5E Battery

In October 2010, the group released a package of almost 400,000 documents called the Iraq War Logs in coordination with major commercial media organisations. This allowed the mapping of 109,032 deaths in “significant” attacks by insurgents in Iraq that had been reported to Multi-National Force – Iraq, including around 15,000 that had not been previously published.[14][1

 

Sony VPCF13Z8E Battery5] In April 2011, WikiLeaks began publishing 779 secret files relating to prisoners detained in the Guantanamo Bay detention camp.[16]

In November 2010, WikiLeaks collaborated with major global media organisations to release U.S. State department diplomatic cables in redacted format. On 1 September 2011, it became public that an encrypted version of WikiLeaks’ huge archive of unredacted U.S. State Department cables had been available via Bittorrent for months, Sony VPCF11D4E Battery

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and that the decryption key (similar to a password) was available to those who knew where to look. WikiLeaks blamed the breach on its former partner, The Guardian, and that newspaper’s journalist David Leigh, who revealed the key in a book published in February 2011;[17] Sony VPC-F21Z1E Battery

The Guardian argued that WikiLeaks was to blame since they gave the impression that the decryption key was temporary (something not possible for a file decryption key).[18] Der Spiegel reported a more complex story[19] involving errors on both sides. The incident led to widely expressed fears that the information released could endanger innocent lives.[20][21]

 

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The wikileaks.org domain name was registered on 4 October 2006.[3] The website was unveiled, and published its first document, in December 2006.[22][23] WikiLeaks has been predominantly represented in public since January 2007 by Julian Assange, who is now generally recognised as the “founder of WikiLeaks.”[24] Sony VPCF22J1E Battery

According to Wired magazine, a volunteer said that Assange described himself in a private conversation as “the heart and soul of this organisation, its founder, philosopher, spokesperson, original coder, organizer, financier, and all the rest.”[25]

 

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WikiLeaks relies to some degree on volunteers and previously described its founders as a mix of Asian dissidents, journalists, mathematicians, and start-up company technologists from the United States, Taiwan, Europe, Australia, and South Africa.[26] The site was originally launched as a user-editable wiki (hence its name),

 

Sony VPCF1318E/H Battery but has progressively moved toward a more traditional publication model and no longer accepts either user comments or edits. As of June 2009, the site had over 1,200 registered volunteers[26] and listed an advisory board comprising Assange, his deputy Jash Vora and seven other people, some of which denied any association with the organisation.[27][28] Sony VPCF22L1E Battery

 

Despite using the name “WikiLeaks”, the website is no longer wiki-based as of May 2010.[29] Also, despite some popular confusion[30] due to both having the term “wiki” in their names, WikiLeaks and Wikipedia have no affiliation with each other (“wiki” is not a brand name);[31][32]

 

Sony VPCF13J0E/H BatteryWikia, a for-profit corporation loosely affiliated with the Wikimedia Foundation, did purchase several WikiLeaks-related domain names (including wikileaks.com and wikileaks.net) as a “protective brand measure” in 2007.[33] Sony VPCF22M1E Battery

 

[edit]Purpose

The WikiLeaks website says their goal is “to bring important news and information to the public… One of our most important activities is to publish original source material alongside our news stories so readers and historians alike can see evidence of the truth.” Sony VPCF22S1E Battery

 

Another of the organisation’s goals is to ensure that whistleblowers and journalists are not jailed for emailing sensitive or classified documents. The online “drop box” (currently not functioning) was designed to “provide an innovative, secure and anonymous way for sources to leak information to our journalists.”

 

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In an interview on The Colbert Report, Assange discussed the limit to the freedom of speech, saying, “[it is] not an ultimate freedom, however free speech is what regulates government and regulates law. That is why in the US Constitution the Bill of Rights says that Congress is to make no such law abridging the freedom of the press. Sony VPCF22S8E Battery

It is to take the rights of the press outside the rights of the law because those rights are superior to the law because in fact they create the law. Every constitution, every bit of legislation is derived from the flow of information. Similarly every government is elected as a result of people understanding things”.[34] Sony VPCF23M1E Battery

 

The project has drawn comparisons to Daniel Ellsberg’s leaking of the Pentagon Papers in 1971.[35] In the United States, the leaking of some documents may be legally protected. The U.S. Supreme Court has ruled that the Constitution guarantees anonymity, at least in the area of political discourse.[35

 

Sony VPCF13E4E Battery] Author and journalist Whitley Strieber has spoken about the benefits of the WikiLeaks project, noting that “Leaking a government document can mean jail, but jail sentences for this can be fairly short. However, there are many places where it means long incarceration or even death, such as China and parts of Africa and the Middle East.”[36] Sony VPCF23Q1E Battery

 

[edit]Administration

 

According to a January 2010 interview, the WikiLeaks team then consisted of five people working full-time and about 800 people who worked occasionally, none of whom were compensated.[37] WikiLeaks has no official headquarters.

 

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[edit]Hosting

WikiLeaks describes itself as “an uncensorable system for untraceable mass document leaking”.[38] The site is available on multiple servers and different domain names following a number of denial-of-service attacks and its severance from different Domain Name System (DNS) providers.[39][40]

 

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Until August 2010, WikiLeaks was hosted by PRQ, a Sweden-based company providing “highly secure, no-questions-asked hosting services”. PRQ is said to have “almost no information about its clientele and maintains few if any of its own logs”.[41] Currently, WikiLeaks is mainly hosted by Bahnhof in a facility that used to be a nuclear bunker.[42

Sony VPCF12E1E/H Battery][43] Other servers are spread around the world with the central server located in Sweden.[44] Julian Assange has said that the servers are located in Sweden (and the other countries) “specifically because those nations offer legal protection to the disclosures made on the site”. He talks about the Swedish constitution,

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which gives the information providers total legal protection.[44] It is forbidden according to Swedish law for any administrative authority to make inquiries about the sources of any type of newspaper.[45] These laws, and the hosting by PRQ, make it difficult for any authorities to take WikiLeaks offline;

 

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they place an onus of proof upon any complainant whose suit would circumscribe WikiLeaks’ liberty, e.g. its rights to exercise free speech online. Furthermore, “WikiLeaks maintains its own servers at undisclosed locations, keeps no logs and uses military-grade encryption to protect sources and other confidential information.” Such arrangements have been called “bulletproof hosting.”[41][46]

 

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On 17 August 2010, it was announced that the Swedish Pirate Party would be hosting and managing many of WikiLeaks’ new servers. The party donates servers and bandwidth to WikiLeaks without charge. Technicians of the party would make sure that the servers are maintained and working.[47][48]

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After the site became the target of a denial-of-service attack on its old servers, WikiLeaks moved its site to Amazon’s servers.[49] Later, however, the website was “ousted” from the Amazon servers.[49] In a public statement,

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Amazon said that WikiLeaks was not following its terms of service. The company further explained, “There were several parts they were violating. For example, our terms of service state that ‘you represent and warrant that you own or otherwise control all of the rights to the content.. Sony VPCF231S1E Battery. that use of the content you supply does not violate this policy and will not cause injury to any person or entity.’ It’s clear that WikiLeaks doesn’t own or otherwise control all the rights to this classified content.”[50] WikiLeaks then decided to install itself on the servers of OVH in France.[51] Sony VPCF13M8E/B Battery 

After criticism from the French government, the company sought two court rulings about the legality of hosting WikiLeaks. While the court in Lille immediately declined to force OVH to shut down the WikiLeaks site, the court in Paris stated it would need more time to examine the highly technical issue.[52][53]

 

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WikiLeaks is based on several software packages, including Tor[54] and PGP.[citation needed] WikiLeaks was implemented on MediaWiki software between 2006 and October 2010.[55] WikiLeaks strongly encouraged postings via Tor because of the strong privacy needs of its users.[56]

 

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On 4 November 2010, Julian Assange told Swiss public television TSR that he is seriously considering seeking political asylum in neutral Switzerland and setting up a WikiLeaks foundation to move the operation there.[57][58] According to Assange, Switzerland and Iceland are the only countries where WikiLeaks would feel safe to operate.[59][60] Sony VPCF13Z0E/B Battery 

 

[edit]Name servers

WikiLeaks had been using EveryDNS’s services, which led to DDoS attacks on the host.[clarification needed] The attacks affected the quality of service at EveryDNS, so the company withdrew its service from WikiLeaks. Pro-WikiLeaks supporters retaliated by launching a DDoS attack against EveryDNS.

 

Sony VPCYB3V1E/R BatteryBecause of mistakes in the blogosphere, some supporters accidentally mistook EasyDNS for EveryDNS and a sizable internet backlash against EasyDNS ensued. Afterwards EasyDNS decided to provide WikiLeaks its name server service.[61] Sony VPCM13M1E/L Battery 

 

[edit]Verification of submissions

WikiLeaks states that it has never released a misattributed document. Documents are assessed before release. In response to concerns about the possibility of misleading or fraudulent leaks, WikiLeaks has stated that misleading leaks “are already well-placed in the mainstream media. WikiLeaks is of no additional assistance.”[62]

 

Sony VPCF11S1E/B BatteryThe FAQ states that: “The simplest and most effective countermeasure is a worldwide community of informed users and editors who can scrutinise and discuss leaked documents.”[63]

 

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According to statements by Assange in 2010, submitted documents are vetted by a group of five reviewers, with expertise in different fields such as language or programming, who also investigate the background of the leaker if his or her identity is known.[64] In that group, Assange has the final decision about the assessment of a document.[64] Sony VPCM13M1E/W Battery 

 

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[edit]Legal status

[edit]Legal background

The legal status of WikiLeaks is complex. Assange considers WikiLeaks a whistleblower protection intermediary. Rather than leaking directly to the press, and fearing exposure and retribution, whistleblowers can leak to WikiLeaks, which then leaks to the press for them.[65Sony VPCF22M1E Battery 

] Its servers are located throughout Europe and are accessible from any uncensored web connection. The group located its headquarters in Sweden because it has one of the world’s strongest shield laws to protect confidential source-journalist relationships.[66][67] WikiLeaks has stated it does not solicit any information.[6

 

Sony VPCF22S1E Battery6] However, Assange used his speech during the Hack In The Box conference in Malaysia to ask the crowd of hackers and security researchers to help find documents on its “Most Wanted Leaks of 2009″ list.[68]

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[edit]Potential criminal prosecution

The U.S. Justice Department opened a criminal probe of WikiLeaks and founder Julian Assange shortly after the leak of diplomatic cables began.[69][70] Attorney General Eric Holder affirmed the probe was “not sabre-rattling”

 

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, but was “an active, ongoing criminal investigation.”[70] The Washington Post reported that the department was considering charges under the Espionage Act, a move which former prosecutors characterised as “difficult” because of First Amendment protections for the press.[69][7Sony VPCF11M1E/H Battery 

1] Several Supreme Court cases have previously established that the American constitution protects the re-publication of illegally gained information provided the publishers did not themselves break any laws in acquiring it.[72] Sony VPCF13M0E/B Battery      Federal prosecutors have also considered prosecuting Assange for trafficking in stolen government property, but since the diplomatic cables are intellectual rather than physical property, that approach also faces hurdles.[73] Any prosecution of Assange would require extraditing him to the United States, a step made more complicated and potentially delayed by any preceding extradition to Sweden.[74]

 

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One of Assange’s lawyers, however, says they are fighting extradition to Sweden because it might lead to his extradition to the United States.[75] Assange’s attorney, Mark Stephens, has “heard from Swedish authorities there has been a secretly empanelled grand jury in Alexandria [Virginia]” meeting to consider criminal charges in the WikiLeaks case.[76] Sony VPCF23Z1E Battery 

 

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In Australia, the government and the Australian Federal Police have not stated what Australian laws may have been broken by WikiLeaks, but Prime Minister Julia Gillard has stated that the foundation of WikiLeaks and the stealing of classified documents from the US administration is illegal in foreign countries.[77]

 

Sony VPCF23M1E Battery Gillard later clarified her statement as referring to “the original theft of the material by a junior US serviceman rather than any action by Mr Assange.”[78] Spencer Zifcak, President of Liberty Victoria, an Australian civil liberties group, notes that with no charge, and no trial completed, it is inappropriate to state that WikiLeaks is guilty of illegal activities.[79] Sony VPCF22M0E Battery 

 

On threats by various governments toward Assange, legal expert Ben Saul argues that founder Julian Assange is the target of a global smear campaign to demonise him as a criminal or as a terrorist, without any legal basis.[80] The U.S. Center for Constitutional Rights has issued a statement highlighting its alarm at the “multiple examples of legal overreach and irregularities” in his arrest.[81]

 

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[edit]Insurance files

On 29 July 2010, WikiLeaks added a 1.4 GB “Insurance file” to the Afghan War Diary page. The file is AES encrypted and has a SHA1 checksum of “cce54d3a8af370213d23fcbfe8cddc8619a0734c”.[82][83] There has been speculation that it was intended to serve as insurance in case the WikiLeaks website or its spokesman Julian Assange are incapacitated, upon which the passphrase could be published, similar to the concept of a dead man’s switch.[84][8

 

Sony VPCF22L1E Battery5] Following the first few days’ release of the US diplomatic cables starting 28 November 2010, the US television broadcaster CBS predicted that “If anything happens to Assange or the website, a key will go out to unlock the files. There would then be no way to stop the information from spreading like wildfire because so many people already have copies.”[86] CBS correspondent Declan McCullagh stated,

 

Sony VPCF22J1E Battery“What most folks are speculating is that the insurance file contains unreleased information that would be especially embarrassing to the US government if it were released.”[86]

 

In February 2012 there was another insurance file release, this time 65GB in size.[87]

The insurance files are not to be confused with another encrypted file containing diplomatic cables, whose password has been compromised. The insurance files’ passwords have not been compromised and their contents are still unknown. Sony VPCF13S1E/B Battery 

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[edit]Financing

WikiLeaks is a non-profit organisation, largely supported by volunteers, and it is dependent on public donations. Its main financing methods include conventional bank transfers and online payment systems. Annual expenses have been estimated at about €200,000, mainly for servers and bureaucracy, but might reportedly reach €600,000 if work currently done by volunteers were paid for.[37]

 

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WikiLeaks’ lawyers often work pro bono, and in some cases legal support has been donated by media organisations such as the Associated Press, Los Angeles Times, and the National Newspaper Publishers Association.[37

Sony VPCF24Q1E Battery] WikiLeaks only revenue stream is donations, but it has considered other options including an auction model to sell early access to documents.[37] In September 2011, Wikileaks began auctioning items on eBay to raise funds, and Assange told an audience at Sydney’s Festival of Dangerous Ideas that the organisation might not be able to survive. Sony VPCF12Z1E Battery 

 

 

[edit]Funding model

The Wau Holland Foundation helps to process donations to WikiLeaks. In July 2010, the Foundation stated that WikiLeaks was receiving no money for personnel costs, only for hardware, travelling and bandwidth.[88] An article in TechEye stated: Sony VPCF12S1E/B Battery 

As a charity accountable under German law, donations for WikiLeaks can be made to the foundation. Funds are held in escrow and are given to WikiLeaks after the whistleblower website files an application containing a statement with proof of payment. The foundation does not pay any sort of salary nor give any renumeration [Sony VPCF12M0E/B Battery
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ic] to WikiLeaks’ personnel, corroborating the statement of the site’s former German representative Daniel Schmitt [real name Daniel Domscheit-Berg][89] on national television that all personnel works voluntarily, even its speakers.[88]

However, in December 2010 the Wau Holland Foundation stated that 4 permanent employees, including Julian Assange, had begun to receive salaries.[90] Sony VAIO VPCS11B7E Battery

 

 

On 24 December 2009, WikiLeaks announced that it was experiencing a shortage of funds[91] and suspended all access to its website except for a form to submit new material.[92] Material that was previously published was no longer available, although some could still be accessed on unofficial mirrors.[93] WikiLeaks stated on its website that it would resume full operation once the operational costs were covered.[9

Sony VAIO VPCS11X9E Battery2] WikiLeaks saw this as a kind of strike “to ensure that everyone who is involved stops normal work and actually spends time raising revenue”.[37] While the organisation initially planned for funds to be secured by 6 January 2010,[94] it was not until 3 February 2010 that WikiLeaks announced that its minimum fundraising goal had been achieved.[95] Sony VAIO VPCS11C5E Battery

 

 

On 22 January 2010, PayPal suspended WikiLeaks’ donation account and froze its assets. WikiLeaks said that this had happened before, and was done for “no obvious reason”.[96] The account was restored on 25 January 2010.[97] On 18 May 2010, WikiLeaks announced that its website and archive were back up.[98]

 

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In June 2010, WikiLeaks was a finalist for a grant of more than half a million dollars from the John S. and James L. Knight Foundation,[23] but did not make the cut.[99] WikiLeaks commented via Twitter, “WikiLeaks was highest rated project in the Knight challenge, strongly recommended to the board but gets no funding. Go figure.”[10

Sony VAIO VPCS11H7E Battery0] WikiLeaks said that the Knight foundation announced the award to “’12 Grantees who will impact future of news’ – but not WikiLeaks” and questioned whether Knight foundation was “really looking for impact”.[99]

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A spokesman of the Knight Foundation disputed parts of WikiLeaks’ statement, saying “WikiLeaks was not recommended by Knight staff to the board.”[100] However, he declined to say whether WikiLeaks was the project rated highest by the Knight advisory panel, which consists of non-staffers, among them journalist Jennifer 8. Lee, who has done PR work for WikiLeaks with the press and on social networking sites.[100] Sony VAIO VPCS11D7E Battery

 

 

In 2010, WikiLeaks received €635,772.73 in PayPal donations, less €30,000 in PayPal fees, and €695,925.46 in bank transfers. €500,988.89 of the sum was received in the month of December, primarily as bank transfers as PayPal suspended payments December 4. €298,057.38 of the remainder was received in April.[101]

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The Wau Holland Foundation, one of the WikiLeaks’ main funding channels, stated that they received more than €900,000 in public donations between October 2009 and December 2010, out of which €370,000 has been passed on to WikiLeaks. Hendrik Fulda, vice president of the Wau Holland Foundation,

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mentioned that the Foundation had been receiving twice as many donations through PayPal as through normal banks, before PayPal’s decision to suspend WikiLeaks’ account. He also noted that every new WikiLeaks publication brought “a wave of support”, and that donations were strongest in the weeks after WikiLeaks started publishing leaked diplomatic cables.[102][103]

On 15 June 2011, WikiLeaks began accepting donations in Bitcoin.[104][105][106] Sony VAIO VPCS11E7E Battery

 

 

[edit]Leaks

 

Main article: Information published by WikiLeaks

[edit]2006–08

WikiLeaks posted its first document in December 2006, a decision to assassinate government officials signed by Sheikh Hassan Dahir Aweys.”[23] In August 2007, The Guardian published a story about corruption by the family of the former Kenyan leader Daniel arap Moi based on information provided via WikiLeaks.

 

Sony VAIO VPCS13S8R/S Battery107] In November 2007, a March 2003 copy of Standard Operating Procedures for Camp Delta detailing the protocol of the U.S. Army at the Guantanamo Bay detention camp was released.[108] The document revealed that some prisoners were off-limits to the International Committee of the Red Cross, something that the U.S. military had in the past repeatedly denied.[109]

 

Sony VAIO VPCS12E7E BatteryIn February 2008, WikiLeaks released allegations of illegal activities at the Cayman Islands branch of the Swiss Bank Julius Baer, which led to the bank suing WikiLeaks and obtaining an injunction which temporarily shut down wikileaks.org.[110Sony VAIO VPCS11F7E Battery

] The California judge had the service provider of WikiLeaks block the site’s domain (wikileaks.org) on 18 February 2008, although the bank only wanted the documents to be removed but WikiLeaks had failed to name a contact. The site was instantly mirrored by supporters, and later that month the judge overturned his previous decision citing First Amendment concerns and questions about legal jurisdiction.[111

 

Sony VAIO VPCS12D7E Battery][112] In March 2008, WikiLeaks published what they referred to as “the collected secret ‘bibles’ of Scientology,” and three days later received letters threatening to sue them for breach of copyright.[113]

 

Sony VAIO VPCS12C5E Battery In September 2008, during the 2008 United States presidential election campaigns, the contents of a Yahoo account belonging to Sarah Palin (the running mate of Republican presidential nominee John McCain) were posted on WikiLeaks after being hacked into by members of Anonymous.[114]

 

Sony VAIO VPCS12B7E BatteryIn November 2008, the membership list of the far-right British National Party was posted to WikiLeaks, after briefly appearing on a blog.[115] A year later, on October 2009, another list of BNP members was leaked.[116] Sony VAIO VPCS11G7E Battery

 

[edit]2009

In January 2009, WikiLeaks released 86 telephone intercept recordings of Peruvian politicians and businessmen involved in the 2008 Peru oil scandal.[117] In February, WikiLeaks released 6,780 Congressional Research Service reports[118] followed in March, by a list of contributors to the Norm Coleman senatorial campaign[119]

 

Sony VAIO VPCS12A7R Battery [120] and a set of documents belonging to Barclays Bank that had been ordered removed from the website of The Guardian.[121] In July, it released a report relating to a serious nuclear accident that had occurred at the Iranian Natanz nuclear facility in 2009.[122] Later media reports have suggested that the accident was related to the Stuxnet computer worm.[123][124]

 

Sony VAIO VPCS12A7E Battery In September, internal documents from Kaupthing Bank were leaked, from shortly before the collapse of Iceland’s banking sector, which led to the 2008–2012 Icelandic financial crisis. The document shows that suspiciously large sums of money were loaned to various owners of the bank, and large debts written off.[125] Sony VAIO VPCS11J7E Battery

In October, Joint Services Protocol 440, a British document advising the security services on how to avoid documents being leaked was published by WikiLeaks.[126] Later that month, it announced that a super-injunction was being used by the commodities company Trafigura to gag The Guardian (London) from reporting on a leaked internal document regarding a toxic dumping incident in the Ivory Coast.[127]

Sony VAIO VPCS11V9E/B Battery [128] In November, it hosted copies of e-mail correspondence between climate scientists, although they were not originally leaked to WikiLeaks.[129][130] It also released 570,000 intercepts of pager messages sent on the day of the 11 September attacks.[131] During 2008 and 2009,

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WikiLeaks published the alleged lists of forbidden or illegal web addresses for Australia, Denmark and Thailand. These were originally created to prevent access to child pornography and terrorism, but the leaks revealed that other sites covering unrelated subjects were also listed.[132][133][134] Sony VAIO VPCS11M1E/W Battery

[edit]2010

In mid-February 2010, WikiLeaks received a diplomatic cable from the US Embassy in Reykjavik relating to the Icesave scandal, which they published on 18 February.[135] The cable, known as Reykjavik 13 was the first of the classified documents WikiLeaks published among those allegedly provided to them by US Army Private Bradley Manning. In March 2010, Sony VAIO PCG-3B1M Battery

WikiLeaks released a secret 32-page U.S. Department of Defense Counterintelligence Analysis Report written in March 2008 discussing the leaking of material by WikiLeaks and how it could be deterred.[136][137][138] In April, a classified video of the 12 July 2007 Baghdad airstrike was released, showing two Reuters employees being fired at, after the pilots mistakenly thought the men were carrying weapons, which were in fact cameras.[1Sony VAIO PCG-3D1M Battery

39] In the week following the release, “wikileaks” was the search term with the most significant growth worldwide in the last seven days as measured by Google Insights.[140] In June 2010, Manning was arrested after alleged chat logs were turned in to the authorities by former hacker Adrian Lamo, in whom he had confided.

 

Sony VAIO PCG-7144M Battery Manning reportedly told Lamo he had leaked the “Collateral Murder” video, in addition to a video of the Granai airstrike and around 260,000 diplomatic cables, to WikiLeaks.[141] In July, WikiLeaks released 92,000 documents related to the war in Afghanistan between 2004 and the end of 2009 to The Guardian, The New York Times and Der Spiegel. The documents detail individual incidents including friendly fire and civilian casualties.[14Sony VAIO PCG-3G2M Battery

2] At the end of July, a 1.4 GB “insurance file” was added to the Afghan War Diary page, whose decryption details would be released if WikiLeaks or Assange were harmed.[84] About 15,000 of the 92,000 documents have not yet been released on WikiLeaks, as the group is currently reviewing the documents to remove some of the sources of the information. WikiLeaks asked the Pentagon and human-rights groups to help remove names from the documents to reduce the potential harm caused by their release, but did not receive assistance.[143Sony VAIO PCG-5R1M Battery

] Following the Love Parade stampede in Duisburg, Germany, on 24 July 2010, a local resident published internal documents of the city administration regarding the planning of Love Parade. The city government reacted by securing a court order on 16 August forcing the removal of the documents from the site on which it was hosted.[144] On 20 August 2010, WikiLeaks released a publication entitled Loveparade

 

Sony VAIO PCG-71312M Battery 2010 Duisburg planning documents, 2007–2010, which comprised 43 internal documents regarding the Love Parade 2010.[145][146] Following on from the leak of information from the Afghan War, in October 2010, around 400,000 documents relating to the Iraq War were released.

 

Sony VAIO PCG-7153M BatteryThe BBC quoted The Pentagon referring to the Iraq War Logs as “the largest leak of classified documents in its history.” Media coverage of the leaked documents focused on claims that the U.S. government had ignored reports of torture by the Iraqi authorities during the period after the 2003 war.[147] Sony VAIO PCG-7141M Battery

 

[edit]Diplomatic cables release

Main articles: United States diplomatic cables leak, contents, and reactions

On 28 November 2010, WikiLeaks and five major newspapers from Spain (El País), France (Le Monde), Germany (Der Spiegel), the United Kingdom (The Guardian), and the United States (The New York Times) started to simultaneously publish the first 220 of 251,287 leaked confidential—but not top-secret—diplomatic cables from 274 US embassies around the world,

 

Sony VAIO PCG-41112M Batterydated from 28 December 1966 to 28 February 2010.[148][149] WikiLeaks plans to release the entirety of the cables in phases over several months.[149]

The contents of the diplomatic cables include numerous unguarded comments and revelations regarding: critiques and praises about the host countries of various US embassies; political manoeuvring regarding climate change;

Sony VAIO PCG-7181M Batterydiscussion and resolutions towards ending ongoing tension in the Middle East; efforts and resistance towards nuclear disarmament; actions in the War on Terror; assessments of other threats around the world; dealings between various countries; Sony VAIO PCG-7143M Battery

 

US intelligence and counterintelligence efforts; and other diplomatic actions. Reactions to the United States diplomatic cables leak include stark criticism, anticipation, commendation, and quiescence. Consequent reactions to the US government include ridicule, sympathy, bewilderment and dismay. On 14 December 2010 the United States Department of Justice issued a subpoena directing Twitter to provide information for accounts registered to or associated with WikiLeaks.[150] Twitter decided to notify its users.[15Sony VAIO PCG-7151M Battery

1] The overthrow of the presidency in Tunisia has been attributed in part to reaction against the corruption revealed by leaked cables.[152][153][154]

[edit]2011–12

Main articles: Guantanamo Bay files leak, Global Intelligence Files leak, and Syria Files

In late April 2011, files related to the Guantanamo prison were released.[155] In December 2011, WikiLeaks started to release the Spy Files.[156] On 27 February 2012, WikiLeaks began publishing more than five million emails from the Texas-headquartered “global intelligence” company Stratfor.[157] Sony VAIO PCG-7154M Battery

On 5 July 2012, WikiLeaks began publishing the Syria Files, more than two million emails from Syrian political figures, ministries and associated companies, dating from August 2006 to March 2012.[158] Sony VAIO PCG-7162M Battery

 

[edit]Announcements of upcoming leaks

In May 2010, WikiLeaks said it had video footage of a massacre of civilians in Afghanistan by the US military which they were preparing to release.[159][160]

In an interview with Chris Anderson on 19 July 2010, Assange showed a document WikiLeaks had on an Albanian oil-well blowout, and said they also had material from inside BP,[161] and that they were “getting enormous quantity of whistle-blower disclosures of a very high calibre” but added that they had not been able to verify and release the material because they did not have enough volunteer journalists.[162] Sony VAIO PCG-3C1M Battery

 

In October 2010, Assange told a leading Moscow newspaper that “The Kremlin had better brace itself for a coming wave of WikiLeaks disclosures about Russia”.[163][164] Assange later clarified: “we have material on many businesses and governments, including in Russia. It’s not right to say there’s going to be a particular focus on Russia”.[165] Sony VAIO PCG-3F1M Battery

 

In a 2009 Computerworld interview, Assange claimed to be in possession of “5GB from Bank of America”. In 2010 he told Forbes magazine that WikiLeaks was planning another “megaleak” early in 2011, from inside the private sector, involving “a big U.S. bank” and revealing an “ecosystem of corruption”. Bank of America’s stock price fell by 3% as a result of this announcement.[166][167]

 

Sony VAIO PCG-8152M Battery Assange commented on the possible impact of the release that “it could take down a bank or two.”[168][169]

In December 2010, Assange’s lawyer, Mark Stephens, told The Andrew Marr Show on BBC Television that WikiLeaks had information it considered to be a “thermo-nuclear device” which it would release if the organisation needs to defend itself against the authorities.[170] Sony VAIO PCG-3H1M Battery

 

In January 2011, Rudolf Elmer, a former Swiss banker, passed on data containing account details of 2,000 prominent people to Assange, who stated that the information will be vetted before being made publicly available at a later date.[171]

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[edit]Backlash and pressure

 

 

 

A truck bearing a slogan and WikiLeaks logo as a prop at the Occupy Wall Street protest in New York on 25 September 2011

[edit]Operational challenges

Assange has acknowledged that the practice of posting largely unfiltered classified information online could one day lead the website to have “blood on our hands.”[23][172] He expressed the view that the potential to save lives,

 

Sony VAIO PCG-31311M Battery however, outweighs the danger to innocents.[173] Furthermore, WikiLeaks has highlighted independent investigations which have failed to find any evidence of civilians harmed as a result of WikiLeaks’ activities.[174][175] A surveillance-resistant social network, FoWL (Friends of WikiLeaks), was launched by the organization in June 2012[176] by way of advocacy.

 

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[edit]Response from media

Chinese journalist Shi Tao was sentenced to 10 years in 2005 after publicising an email from Chinese officials about the anniversary of the Tiananmen Square massacre.[177] An article in The New Yorker said:

 

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One of the WikiLeaks activists owned a server that was being used as a node for the Tor network. Millions of secret transmissions passed through it. The activist noticed that hackers from China were using the network to gather foreign governments’ information, and began to record this traffic

 

Sony VAIO PCG-7186M BatteryOnly a small fraction has ever been posted on WikiLeaks, but the initial tranche served as the site’s foundation, and Assange was able to say, “[w]e have received over one million documents from thirteen countries.”[23][178]

Assange responded to the suggestion that eavesdropping on Chinese hackers played a crucial part in the early days of WikiLeaks by saying “the imputation is incorrect. The facts concern a 2006 investigation into Chinese espionage one of our contacts was involved in. Sony VAIO PCG-8141M Battery

 

Sony VAIO PCG-7171M Battery Somewhere between none and handful of those documents were ever released on WikiLeaks. Non-government targets of the Chinese espionage, such as Tibetan associations were informed (by us)”.[179] Sony VAIO PCG-8161M Battery

 

[edit]Response from governments

[edit]Australia

On 16 March 2009, the Australian Communications and Media Authority added WikiLeaks to their proposed blacklist of sites that will be blocked for all Australians if the mandatory internet filtering censorship scheme is implemented as planned.[180][181] The blacklisting had been removed by 29 November 2010.[182]

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[edit]People’s Republic of China

The WikiLeaks website claims that the government of the People’s Republic of China has attempted to block all traffic to web sites with “wikileaks” in the URL since 2007, but that this can be bypassed through encrypted connections or by using one of WikiLeaks’ many covert URLs.[183] Sony VAIO PCG-3C2M Battery

 

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[edit]Germany

The home of Theodor Reppe, registrant of the German WikiLeaks domain name, wikileaks.de, was raided on 24 March 2009 after WikiLeaks released the Australian Communications and Media Authority (ACMA) censorship blacklist.[184] The site was not affected.[185][186] Sony VAIO PCG-5N2M Battery

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[edit]Iceland

After the release of the 2007 airstrikes video and as they prepared to release film of the Granai airstrike, Julian Assange has said that his group of volunteers came under intense surveillance. In an interview and Twitter posts he said that a restaurant in Reykjavík where his group of volunteers met came under surveillance in March; Sony VAIO PCG-5J1M Battery

that there was “covert following and hidden photography” by police and foreign intelligence services; that an apparent British intelligence agent made thinly veiled threats in a Luxembourg car park; and that one of the volunteers was detained by police for 21 hours. Another volunteer posted that computers were seized, saying “If anything happens to us, Sony VAIO PCG-5J4M Battery

 

Sony VAIO PCG-8113M Batteryyou know why … and you know who is responsible.”[187] According to the Columbia Journalism Review, “the Icelandic press took a look at Assange’s charges of being surveilled in Iceland [...] and, at best, have found nothing to substantiate them.”[188]

 

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In August 2009, Kaupthing Bank secured a court order preventing Iceland’s national broadcaster, RÚV, from broadcasting a risk analysis report showing the bank’s substantial exposure to debt default risk. This information had been leaked by a whistleblower to WikiLeaks and remained available on the WikiLeaks site; faced with an injunction minutes before broadcast, Sony VAIO PCG-5K1M Battery

the channel ran with a screen grab of the WikiLeaks site instead of the scheduled piece on the bank. Citizens of Iceland were reported to be outraged that RÚV was prevented from broadcasting news of relevance.[18

 

Sony VAIO PCG-7134M Battery9] Therefore, WikiLeaks has been credited with inspiring the Icelandic Modern Media Initiative, a bill meant to reclaim Iceland’s 2007 Reporters Without Borders (Reporters sans frontières) ranking as first in the world for free speech. It aims to enact a range of protections for sources, journalists, and publishers.[190][191] Birgitta Jónsdóttir, a former WikiLeaks volunteer and member of the Icelandic parliament, is the chief sponsor of the proposal. Sony VAIO PCG-5K2M Battery

 

[edit]Thailand

The Centre for the Resolution of the Emergency Situation (CRES) is currently censoring the WikiLeaks website in Thailand[192] and more than 40,000 other webpages[193] because of the emergency decree declared in Thailand at the beginning of April 2010 as a result of political instabilities.[194]

 

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[edit]United States

On 17 July 2010, Jacob Appelbaum spoke on behalf of WikiLeaks at the Hackers on Planet Earth conference in New York City, replacing Assange because of the presence of federal agents at the conference.[195][196] Sony VAIO PCG-5J5M Battery

He announced that the WikiLeaks submission system was again up and running, after it had been temporarily suspended.[195][197][198] Assange was a surprise speaker at a TED conference on 19 July 2010 in Oxford, and confirmed that the site had begun accepting submissions again.[161] Sony VAIO PCG-5L2M Battery

 

Upon returning to the US from the Netherlands, on 29 July, Appelbaum was detained for three hours at the airport by US agents, according to anonymous sources.[199] The sources told Cnet that Appelbaum’s bag was searched, receipts from his bag were photocopied, and his laptop was inspected, although in what manner was unclear.[199Sony VAIO PCG-6S4M Battery

] Appelbaum reportedly refused to answer questions without a lawyer present, and was not allowed to make a phone call. His three mobile phones were reportedly taken and not returned.[199] On 31 July, he spoke at a Defcon conference and mentioned his phone being “seized”. After speaking, he was approached by two FBI agents and questioned.[199] Sony VAIO PCG-6W1M Battery

 

Access to WikiLeaks is currently blocked in the United States Library of Congress.[200] On 3 December 2010 the White House Office of Management and Budget sent a memo forbidding all unauthorised federal government employees and contractors from accessing classified documents publicly available on WikiLeaks and other websites.[201

 

Sony VAIO PCG-7122M Battery] The U.S. Army, the Federal Bureau of Investigation, and the Justice Department are considering criminally prosecuting WikiLeaks and Assange “on grounds they encouraged the theft of government property”,[202] although former prosecutors say doing so would be difficult.[71] According to a report on the Daily Beast website, the Obama administration asked Britain,

 

Sony VAIO PCG-7121M Battery Germany, and Australia among others to also consider bringing criminal charges against Assange for the Afghan war leaks and to help limit Assange’s travels across international borders.[203] Columbia University students have been warned by their Office of Career Services that the U.S. State Department had contacted the office in an email saying that the diplomatic cables which were released by WikiLeaks were “still considered classified” and that “online discourse about the documents ‘would call into question your ability to deal with confidential information.’”[204]

 

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All U.S. federal government staff have been blocked from viewing WikiLeaks.[205]

As in individual responses, government officials had mixed feelings. Although Hillary Clinton refused to comment on specific reports, she claimed that the leaks “put people’s lives in danger” and “threatens national security.”[22

 

Sony VAIO PCG-7112M Battery] Former United States Secretary of Defense Robert Gates commented, “Is this embarrassing? Yes. Is it awkward? Yes. Consequences for U.S. foreign policy? I think fairly modest.”[22]

 

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[edit]Response from corporations

[edit]Facebook

WikiLeaks claimed in April 2010 that Facebook deleted its fan page, which had 30,000 fans.[206][207][208] However, as of 7 December 2010 the group’s Facebook fan page was available and had grown by 100,000 fans daily since 1 December,[209] to more than 1.6 million fans. It was also the largest growth of the week.[2

Sony VAIO PCG-8Z2M Battery10] Regarding the presence of WikiLeaks on Facebook, Andrew Noyes, the company’s D.C.-based Manager of Public Policy Communications, has stated “the Wikileaks Facebook Page does not violate our content standards nor have we encountered any material posted on the page that violates our policies.”[211] Sony VAIO PCG-6W2M Battery

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[edit]U.S. diplomatic cables leak responses

According to The Times (London), WikiLeaks and its members have complained about continuing harassment and surveillance by law enforcement and intelligence organisations, including extended detention, seizure of computers, veiled threats, “covert following and hidden photography.”[159] Two lawyers for Julian Assange in the United Kingdom told The Guardian that they believed they were being watched by the security services after the U.S. cables leak, which started on 28 November 2010.[212]

 

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Furthermore, several companies severed ties with WikiLeaks. After providing 24-hour notification, American-owned EveryDNS dropped WikiLeaks from its entries on 2 December 2010, citing DDoS attacks that “threatened the stability of its infrastructure”.[39][213] The site’s ‘info’ DNS lookup remained operational at alternative addresses for direct access respectively to the WikiLeaks and Cablegate websites.[2

Sony VAIO PCG-8Y3M Battery] On the same day, Amazon.com severed its ties with WikiLeaks, to which it was providing infrastructure services, after an intervention by an aide of U.S. Senator Joe Lieberman.[215][216][217] Amazon denied acting under political pressure, citing a violation of its terms of service.[218] 14Sony VAIO PCG-8Y2M BatteryCiting indirect pressure from the U.S. Government, Tableau Software also dropped WikiLeaks’ data from its site for people to use for data visualisation.[219][220]

In the days following, hundreds of (and eventually more than a thousand)[221] mirrors of the WikiLeaks site appeared, and the Anonymous group of Internet activists called on supporters to attack the websites of companies which opposed WikiLeaks,[2Sony PCG-61211M Battery

22] under the banner of Operation Payback, previously aimed at anti-piracy organisations.[223] AFP reported that attempts to shut down the wikileaks.org address had led to the site surviving via the so-called Streisand effect, whereby attempts to censor information online leads to it being replicated in many places.[224]

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On 3 December, PayPal, the payment processor owned by eBay, permanently cut off the account of the Wau Holland Foundation that had been redirecting donations to WikiLeaks. PayPal alleged that the account violated its “Acceptable Use Policy”, specifically that the account was used for “activities that encourage, promote, facilitate or instruct others to engage in illegal activity.”[225][226]

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The Vice President of PayPal later stated that they stopped accepting payments after the “State Department told us these were illegal activities. It was straightforward.” Later the same day, he said that his previous statement was incorrect, and that it was in fact based on a letter from the State Department to WikiLeaks.[227]


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On 8 December 2010, the Wau Holland Foundation released a press statement, saying it has filed a legal action against PayPal for blocking its account used for WikiLeaks payments and for libel due to PayPal’s allegations of “illegal activity”.[228]

On 6 December, the Swiss bank PostFinance announced that it had frozen the assets of Assange that it holds, totalling €31,000. In a statement on its website, it stated that this was because Assange “provided false information regarding his place of residence” when opening the account.[229]

 

Sony PCG-91111M Battery WikiLeaks released a statement saying this was because Assange, “as a homeless refugee attempting to gain residency in Switzerland, had used his lawyer’s address in Geneva for the bank’s correspondence”.[230] Sony PCG-71213M Battery

 

On the same day, MasterCard announced that it was “taking action to ensure that WikiLeaks can no longer accept MasterCard-branded products”, adding “MasterCard rules prohibit customers from directly or indirectly engaging in or facilitating any action that is illegal.”[231] The next day, Visa Inc. announced it was suspending payments to WikiLeaks, pending “further investigations”.[232

 

Sony PCG-61713M Battery] In a move of support for WikiLeaks, XIPWIRE established a way to donate to WikiLeaks, and waived their fees.[233] Datacell, the Swiss-based IT company that enabled WikiLeaks to accept credit card donations, announced that it would take legal action against Visa Europe and Mastercard, in order to resume allowing payments to the website.[234] Sony PCG-71311M Battery

 

On 7 December 2010, The Guardian stated that people could donate to WikiLeaks via Commerzbank in Kassel, Germany, or Landsbanki in Iceland, or by post to a post office box at the University of Melbourne or at the wikileaks.ch domain.[235]

The UN High Commissioner for Human Rights Navi Pillay stated that Visa, Mastercard, and Amazon may be “violating WikiLeaks’ right to freedom of expression” by withdrawing their services.[236]

 

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On 21 December, media reported that Apple had removed an application from its App Store, which provided access to the embassy cable leaks.[237]

As part of its ‘Initial Assessments Pursuant to … WikiLeaks’, the US Presidential Executive Office has issued a memorandum to the heads of Executive Departments and Agencies asking whether they have an ‘insider threat program’.[238][239] Sony PCG-71313M Battery

 

On 14 July 2011 WikiLeaks and DataCell Ltd. of Iceland filed a complaint against the international card companies, VISA Europe and MasterCard Europe, for infringement of the antitrust rules of the EU, in response to their withdrawal of financial services to the organisation. In a joint press release,

 

Sony PCG-91211M Battery the organisations stated: “The closure by VISA Europe and MasterCard of Datcell‘s access to the payment card networks in order to stop donations to WikiLeaks violates the competition rules of the European Community.”[240] Sony PCG-71212M Battery

 

[edit]Response from the financial industry

Since the publications of CableGate, WikiLeaks has faced an unprecedented global financial blockade by major finance companies including Mastercard, Visa and PayPal although there has been no legal accusation of any wrongdoing. Sony PCG-71811M Battery

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In October 2010, it was reported that Moneybookers, which collected donations for WikiLeaks, had ended its relationship with the site. Moneybookers stated that its decision had been made “to comply with money laundering or other investigations conducted by government authorities, agencies or commissions.”[241]

 

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On 18 December 2010, Bank of America announced it would “not process transactions of any type that we have reason to believe are intended for Wikileaks,” citing “Wikileaks might be engaged in activities … inconsistent with our internal policies for processing payments”.

 

Sony VGP-BPS26A BatteryWikiLeaks responded in a tweet by encouraging their supporters who were BoA customers to close their accounts. Bank of America has long been believed to be the target of WikiLeaks’ next major release.[242]

 

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Late in 2010, Bank of America approached the law firm of Hunton & Williams to put a stop to WikiLeaks. Hunton & Williams assembled a group of security specialists, HBGary Federal, Palantir Technologies, and Berico Technologies.

 

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During 5 and 6 February 2011, Anonymous hacked HBGary’s web site, copied tens of thousands of documents from HBGary, posted tens of thousands of company emails online, and usurped Barr’s Twitter account in revenge. Some of the documents taken by Anonymous show HBGary Federal was working on behalf of Bank of America to respond to WikiLeaks’ planned release of the bank’s internal documents.

 

Sony VGP-BPS22A BatteryEmails detailed a supposed business proposal by HBGary to assist Bank of America’s law firm, Hunton & Williams, and revealed that the companies were willing to break the law to bring down WikiLeaks and Anonymous.

 

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“CEO Aaron Barr thought he’d uncovered the hackers’ identities and like rats, they’d scurry for cover. If he could nail them, he could cover up the crimes H&W, HBGary, and BoA planned, bring down WikiLeaks, decapitate Anonymous, and place his opponents in prison while collecting a cool fee. He thought he was 88% right; he was 88% wrong.”[243]

 

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In October 2011 Julian Assange said the financial blockade had destroyed 95% of WikiLeaks’ revenues and announced that it was suspending publishing operations in order to focus on fighting the blockade and raising new funds.[244]

On 18 July 2012 Wikileaks, shunned by the financial industry and almost broke, announced that it had found a new way to accept donations again. Accordingly, the Fund for the Defense of Net Neutrality (FDNN) had agreed to channel contributions via Carte Bleue, and WikiLeaks claimed that contractual obligation would prevent Visa and MasterCard to block participation in such transactions.[245]

 

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[edit]Internal conflicts

 

[edit]Restructuring

Some supporters were unhappy[citation needed] when WikiLeaks moved from a community-based Wiki model to a more centralised organisational structure. The “about” page originally read:[246]

 

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To the user, WikiLeaks will look very much like Wikipedia. Anybody can post to it, anybody can edit it. No technical knowledge is required. Leakers can post documents anonymously and untraceably. Users can publicly discuss documents and analyze their credibility and veracity. Users can discuss interpretations and context and collaboratively formulate collective publications.

 

Sony PCG-91211M BatteryUsers can read and write explanatory articles on leaks along with background material and context. The political relevance of documents and their verisimilitude will be revealed by a cast of thousands.

 

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However, WikiLeaks established an editorial policy that accepted only documents that were “of political, diplomatic, historical or ethical interest” (and excluded “material that is already publicly available”).[247] This coincided with early criticism that having no editorial policy would drive out good material with spam and promote “automated or indiscriminate publication of confidential records.”[248]

 

Sony PCG-71212M Battery It is no longer possible for anybody to post to it or edit it, in any country, as the original FAQ promised. Instead, submissions are regulated by an internal review process and some are published, while documents not fitting the editorial criteria are rejected by anonymous WikiLeaks reviewers. By 2008, the revised FAQ stated that “Anybody can post comments to it. [...]

 

Sony PCG-71911M BatteryUsers can publicly discuss documents and analyse their credibility and veracity.”[249] After the 2010 relaunch, posting new comments on leaks was no longer possible.[29]

[edit]Defections

Within WikiLeaks, there has been public disagreement between founder and spokesperson Julian Assange and Daniel Domscheit-Berg, the site’s former German representative who was suspended by Assange. Domscheit-Berg announced on 28 September 2010 that he was leaving the organisation due to internal conflicts over management of the site.[89][250][251]

 

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Julian Assange (left) with Daniel Domscheit-Berg. Domscheit-Berg was ejected from WikiLeaks and started a rival whistleblower organisation named OpenLeaks.

On 25 September 2010, after being suspended by Assange for “disloyalty, insubordination and destabilization”, Daniel Domscheit-Berg, the German spokesman for WikiLeaks, told Der Spiegel that he was resigning, saying “WikiLeaks has a structural problem.

 

Sony PCG-71311M Battery I no longer want to take responsibility for it, and that’s why I am leaving the project”.[252][253][254] Assange accused Domscheit-Berg of leaking information to Newsweek, claiming the WikiLeaks team was unhappy with Assange’s leadership and handling of the Afghan war document releases.[2
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Sony PCG-71213M Battery54] Domscheit-Berg left with a small group to start OpenLeaks.com, a new leak organisation and website with a different management and distribution philosophy.[252][255]

While leaving, Daniel Domscheit-Berg copied and then deleted roughly 3,500 unpublished documents from the WikiLeaks servers,[256] including information on the US government’s ‘no-fly list’ and inside information from 20 right wing organizations, and accordingly to a WikiLeaks statement,

 

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5 gigabytes of data relating to Bank of America, the internal communications of 20 neo-Nazi organisations and US intercept information for “over a hundred internet companies.”[257] In Domscheit-Berg’s book he wrote: “To this day, we are waiting for Julian to restore security, so that we can return the material to him, which was on the submission platform”.[258]

 

HP Pavilion dv6-3140sa BatteryIn August 2011, Domscheit-Berg permanently deleted the files for which he claimed “in order to ensure that the sources are not compromised”.[259]

Herbert Snorrason, a 25-year old Icelandic university student, resigned after he challenged Assange on his decision to suspend Domscheit-Berg and was bluntly rebuked.[254]

 

HP Pavilion dv6-3130sa Battery Iceland MP Birgitta Jónsdóttir also left WikiLeaks, citing lack of transparency, lack of structure, and poor communication flow in the organisation.[260] According to The Independent (London), at least a dozen key supporters of WikiLeaks left the website in 2010.[261]

 

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[edit]Reception

 

Main article: Reception of WikiLeaks

WikiLeaks has received praise as well as criticism. The organisation has won a number of awards, including The Economist’s New Media Award in 2008 at the Index on Censorship Awards[262] and Amnesty International’s UK Media Award in 2009.[263][264]

 

HP Pavilion dv6-3120sa BatteryIn 2010, the New York Daily News listed WikiLeaks first among websites “that could totally change the news”,[265] and Julian Assange received the Sam Adams Award[266] and was named the Readers’ Choice for TIME’s Person of the Year in 2010.[267] The UK Information Commissioner has stated that “WikiLeaks is part of the phenomenon of the online, empowered citizen”.[268] In its first days, an Internet petition calling for the cessation of extra-judicial intimidation of WikiLeaks attracted over six hundred thousand signatures.[269]

 

HP Pavilion dv6-3116sa BatterySupporters of WikiLeaks in the media and academia have commended it for exposing state and corporate secrets, increasing transparency, supporting freedom of the press, and enhancing democratic discourse while challenging powerful institutions.[

 

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At the same time, several U.S. government officials have criticized WikiLeaks for exposing classified information and claimed that the leaks harm national security and compromise international diplomacy.[277][278][279]

 

HP Pavilion dv6-3110sa Battery [280][281] Several human rights organisations requested with respect to earlier document releases that WikiLeaks adequately redact the names of civilians working with international forces, in order to prevent repercussions.[282] Some journalists have likewise criticised a perceived lack of editorial discretion when releasing thousands of documents at once and without sufficient analysis.[28

 

HP Pavilion dv6-3110ea Battery3] In response to some of the negative reaction, the UN High Commissioner for Human Rights has expressed her concern over the “cyber war” against WikiLeaks,[284] and in a joint statement with the Organization of American States the UN Special Rapporteur has called on states and other actors to keep international legal principles in mind.[285] According to journalist Catherine A. Fitzpatrick, WikiLeaks is motivated by “a theory of anarchy,” not a theory of journalism or social activism.[286]
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[edit]Spin-offs

 

Releases of US diplomatic cables inspired the creation of a number of other organisations based on the WikiLeaks model.[287]

OpenLeaks was created by a former WikiLeaks spokesperson. Daniel Domscheit-Berg said the intention was to be more transparent than WikiLeaks. OpenLeaks was supposed to start public operations in early 2011 but despite much media coverage it is still not functioning.

 

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In December 2011, Wikileaks launched Friends of Wikileaks, a social network for supporters and founders of the platform.[288]

Brussels Leaks was focused on the European Union as a collaborative effort of media professionals and activists that sought to “pull the shady inner workings of the EU system out into the public domain. This is about getting important information out there, not about Brusselsleaks [or any other 'leaks' for that matter].”

 

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TradeLeaks was created to “do to trade and commerce what WikiLeaks has done to politics.” It was founded by Australian Ruslan Kogan. Its goal is to ensure “individuals and businesses should attain values from others through mutually beneficial and fully consensual trade, rather than force, fraud or deception.” Unfortunately the site itself appears to have become discounted by its users, as evidenced by the highest rated article being “Tradeleaks tampering with leak vote count mechanism”.

 

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Balkan Leaks was founded by Bulgarian Atanas Chobanov in order to make the Balkans more transparent and to fight corruption as “There are plenty of people out there that want to change the Balkans for good and are ready to take on the challenge. We’re offering them a hand.” HP Pavilion dv6-3010sa Battery

 

Indoleaks is an Indonesian site that seeks to publish classified documents primarily from the Indonesian government.

RuLeaks is aimed at being a Russian equivalent to WikiLeaks. It was originally launched to provide translated versions of the WikiLeaks cables but the Moscow Times reports it has started to publish its own content as well.[289]

 

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PPLeaks and PSOELeaks are related to the Spanish Partido Popular and PSOE leaks and scandals.

Leakymails is a project designed to obtain and publish relevant documents exposing corruption of the political class and the powerful in Argentina.[290][291][292] HP Pavilion dv6-3015sa Battery

 

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Honest Appalachia,[293] launched in January 2012, is a website based in the United States which hopes to reach out to potential whistleblowers in West Virginia, Virginia, Pennsylvania, Ohio, Kentucky, Tennessee and North Carolina, and serve as a replicable model for similar projects elsewhere.[294][295] HP Pavilion dv6-3020sa Battery

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Country music is a popular American musical style

Country music is a popular American musical style

Country music is a popular American musical style that began in the rural Southern United States in the 1920s.[1] It takes its roots from Western cowboy and southeastern American folk music. Country music often consists of ballads and dance tunes with generally simple forms and harmonies accompanied by mostly string instruments such as banjoes, electric and acoustic guitars, fiddles such as violins, and harmonicas.[2][3][4] Sony VAIO VGN-SR11M Battery

 

The term country music gained popularity in the 1940s in preference to the earlier term hillbilly music. The term country music is used today to describe many styles and subgenres. In 2009 Country music was the most listened to rush hourSony VAIO VGN-SR11MR Battery

radio genre during the evening commute, and second most popular in the morning commute.[5]

Immigrants to the Maritime Provinces and Southern Appalachian Mountains of North America brought the music and instruments of the Old World along with them for nearly 300 years.

 

Sony VAIO VGN-SR51MF/W Battery They brought some of their most important valuables with them, and to most of them this was an instrument: “Early Scottish settlers enjoyed the fiddle because it could be played to sound sad and mournful or bright and bouncy”[6] The fiddle, the German derived dulcimer, the Italian mandolin, Sony VAIO VGN-SR19VN Battery

the Spanish guitar, and the West African banjo[7] were the most common musical instruments. The interactions among musicians from different ethnic groups produced music unique to this region of North America. Appalachian string bands of the early 20th century primarily consisted of the fiddle, guitar, and banjo.[8] Sony VAIO VGN-SR19XN Battery

This early country music along with early recorded country music is often referred to as old-time music.

According to Bill Malone in Country Music U.S.A, country music was “introduced to the world as a southern phenomenon.”[9] Sony VAIO VGN-SR21M/S Battery

In the South, folk music was a combination of cultural strains, combining musical traditions of a variety of ethnic groups in the region. For example, some instrumental pieces from British and Irish immigrants were the basis of folk songs and ballads that form what is now known as old time music, Sony VAIO VGN-SR21RM/H Battery

from which country music descended. It is commonly thought that British and Irish folk music heavily influenced the development of old time music in the Southern Appalachian Mountains, where the earliest European settlers hailed principally from Northern England, the Scottish Lowlands and Ulster.[10] Sony VAIO VGN-SR29VN Battery

 

Often, when many people think or hear country music, they think of it as a creation of European-Americans. However, a great deal of style—and of course, the banjo, a major instrument in most early American folk songs—came from African Americans. One of the reasons country music was created by African-Americans, Sony VAIO VGN-SR31M Battery

as well as European-Americans, is because blacks and whites in rural communities in the south often worked and played together, just as recollected by DeFord Bailey[11] in the PBS documentary, DeFord Bailey: A Legend Lost.[12] Sony VAIO VGN-SR41M/P Battery

Influential black guitarist Arnold Schultz, known as the primary source for thumb style, or Travis picking, played with white musicians in West-central Kentucky.[13]

Throughout the 19th century, several immigrant groups from Europe, most notably from Ireland, Germany, Spain, and Italy moved to Texas. Sony VAIO VGN-SR41M/S Battery

These groups interacted with Mexican and Native American, and U.S. communities that were already established in Texas. As a result of this cohabitation and extended contact, Texas has developed unique cultural traits that are rooted in the culture of all of its founding communities.[14] Sony VAIO VGN-SR41M/W Battery

[edit]1920s

 

Atlanta’s music scene played a major role in launching country’s earliest recording artists in the early 1920s — many Appalachian people had come to the city to work in its cotton mills and brought their music with them. Sony VAIO VGN-SR51MF/P Battery

It would remain a major recording center for two decades and a major performance center for four decades, into the first country music TV shows on local Atlanta stations in the 1950s.[15]

Some record companies in Atlanta turned away early artists such as Fiddlin’ John Carson;
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while others realized that his music would fit perfectly with the lifestyle of the country’s agricultural workers.[16] The first commercial recordings of what was considered country music were “Arkansas Traveler” and “Turkey in the Straw” by fiddlers Henry Gilliland & A.C. (Eck) Robertson on June 30, 1925 for Victor Records.[17] Sony VGP-BPS15/B Battery

 

Columbia Records began issuing records with “hillbilly” music (series 15000D “Old Familiar Tunes”) as early as 1924.[18]

 

 

Vernon Dalhart

A year earlier, on June 14, 1923, Fiddlin’ John Carson recorded “Little Log Cabin in the Lane” for Okeh Records.[19] Vernon Dalhart was the first country singer to have a nationwide hit in May 1924 with “Wreck of the Old ’97″.[20][21] Sony VGP-BPL15/S Battery

The flip side of the record was “Lonesome Road Blues,” which also became very popular.[22] In April 1924, “Aunt” Samantha Bumgarner and Eva Davis became the first female musicians to record and release country songs.[23] Sony VGP-BPS15/S Battery

 

Many “hillbilly” musicians, such as Cliff Carlisle, recorded blues songs throughout the decade[24] and into the 30s. Other important early recording artists were Riley Puckett, Don Richardson, Fiddlin’ John Carson, Uncle Dave Macon, Al Hopkins, Ernest V. Stoneman, Charlie Poole and the North Carolina Ramblers and The Skillet Lickers.[25] Sony VGP-BPS15 Battery

 

Sony VPCW12S1E/T Battery The steel guitar entered country music as early as 1922, when Jimmie Tarlton met famed Hawaiian guitarist Frank Ferera on the West Coast.[26]

Jimmie Rodgers and the Carter Family are widely considered to be important early country musicians. Their songs were first captured at a historic recording session in Bristol on August 1, 1927, where Ralph Peer was the talent scout and sound recordist.[27Sony VGP-BPL15 Battery

][28] A scene in the movie O Brother, Where Art Thou? (film) depicts a similar occ urrence in the same timeframe.

Rodgers fused hillbilly country, gospel, jazz, blues, pop, cowboy, and folk; and many of his best songs were his compositions, including “Blue Yodel”,[29] which sold over a million records and established Rodgers as the premier singer of early country music.[30][31] Sony VGN-P series Battery

Beginning in 1927, and for the next 17 years, the Carters recorded some 300 old-time ballads, traditional tunes, country songs and gospel hymns, all representative of America’s southeastern folklore and heritage.[32] Sony VGN-P11Z/Q Battery

[edit]1930s–1940s

 

One effect of the Great Depression was to reduce the number of records that could be sold. Radio, and broadcasting, became a popular source of entertainment, and “barn dance” shows featuring country music were started all over the South, as far north as Chicago, and as far west as California. Sony VGN-P11Z/R Battery

 

 

 

Roy Acuff

The most important was the Grand Ole Opry, aired starting in 1925 by WSM-AM in Nashville to the present day. Some of the early stars on the Opry were Uncle Dave Macon, Roy Acuff and African American harmonica player DeFord Bailey. WSM’s 50,000 watt signal (1934) could often be heard across the country,[33] Sony VGN-P11Z/W Battery

 

Many musicians performed and recorded songs in any number of styles. Moon Mullican, for example, played Western swing, but also recorded songs that can be called rockabilly. Between 1947 and 1949, country crooner Eddy Arnold placed eight songs in the top 10.[34] Sony VGN-P21S/W Battery

[edit]Singing cowboys and Western swing

 

Main article: Western music (North America)

During the 1930s and 1940s, cowboy songs, or Western music, which had been recorded since the 1920s, were popularized by films made in Hollywood. Some of the popular singing cowboys from the era were Gene Autry, Sony VGN-P21Z/G Battery

 

the Sons of the Pioneers and Roy Rogers.[35] Country music & western music were frequently played together on the same radio stations, hence the term country & western music.

And it wasn’t only cowboys; cowgirls contributed to the sound in various family groups. Patsy Montana opened the door for female artists with her history making song “I Want To Be a Cowboy’s Sweetheart”. Sony VGN-P21Z/R Battery

 

This would begin a movement toward opportunities for women to have successful solo careers.

Bob Wills was another country musician from the Lower Great Plains who had become very popular as the leader of a “hot string band,” and who also appeared in Hollywood Westerns. His mix of country and jazz, which started out as dance hall music, Sony VGN-P29VN/Q Battery

 

would become known as Western swing. Spade Cooley and Tex Williams also had very popular bands and appeared in films. At its height, Western swing rivaled the popularity of other big band jazz.

 

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[edit]Changing instrumentation

Drums were scorned by early country musicians as being “too loud” and “not pure,” but by 1935 Western swing big band leader Bob Wills had added drums to the Texas Playboys. In the mid 1940s, the Grand Ole Opry did not want the Playboys’ drummer to appear on stage. Although drums were commonly used by rockabilly groups by 1955,

 

Sony VPCW11S1E/W Battery the less-conservative-than-the-Grand Ole Opry Louisiana Hayride kept its infrequently used drummer back stage as late as 1956. By the early 1960s, however, it was rare that a country band didn’t have a drummer.[36]

 

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Bob Wills was one of the first country musicians known to have added an electric guitar to his band, in 1938.[37] A decade later (1948) Arthur Smith achieved top 10 US country chart success with his MGM Records recording of “Guitar Boogie”, which crossed over to the US pop chart, introducing many people to the potential of the electric guitar.

 

Sony VPCW11S1E/P Battery For several decades Nashville session players preferred the warm tones of the Gibson and Gretsch archtop electrics, but a “hot” Fender style, utilizing guitars which became available beginning in the early 1950s, eventually prevailed as the signature guitar sound of country.[36][38]

 

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[edit]Hillbilly boogie

Country musicians began recording boogie in 1939, shortly after it had been played at Carnegie Hall, when Johnny Barfield recorded “Boogie Woogie.” The trickle of what was initially called hillbilly boogie, or okie boogie (later to be renamed country boogie), became a flood beginning in late 1945.

 

Sony VGP-BPL18 Battery One notable release from this period was the Delmore Brothers’ “Freight Train Boogie,” considered to be part of the combined evolution of country music and blues towards rockabilly. In 1948, Sony Vaio VGN-AW21M/H Battery

Arthur “Guitar Boogie” Smith achieved top ten US country chart success with his MGM Records recordings of “Guitar Boogie” and “Banjo Boogie,” with the former crossing over to the US pop charts.[39]

Sony VGP-BPL18 Battery Other country boogie artists included Merrill Moore and Tennessee Ernie Ford. The hillbilly boogie period lasted into the 1950s and remains one of many subgenres of country into the 21st century.

[edit]Bluegrass, folk and gospel

 

 

Red Foley

By the end of World War II, “mountaineer” string band music known as bluegrass had emerged when Bill Monroe joined with Lester Flatt and Earl Scruggs, introduced by Roy Acuff at the Grand Ole Opry. Gospel music, too, remained a popular component of country music. Red Foley, the biggest country star following World War II, Sony Vaio VGN-AW21S/B Battery

 

Sony Vaio VGN-AW31ZJ/B Battery had one of the first million-selling gospel hits (“Peace In The Valley”) and also sang boogie, blues and rockabilly.

In the post-war period, country music was called “folk” in the trades, and “hillbilly” within the industry.[40] In 1944, The Billboard replaced the term “hillbilly” with “folk songs and blues,” and switched to “country” or “country and Western” in 1949.[41][42] Sony Vaio VGN-AW21Z/B Battery

 

[edit]Honky tonk

Another type of stripped down and raw music with a variety of moods and a basic ensemble of guitar, bass, dobro or steel guitar (and later) drums became popular, especially among poor whites in Texas and Oklahoma. Sony Vaio VGN-AW31ZS/B Battery

It became known as honky tonk and had its roots in Western swing and the ranchera music of Mexico and the border states, particularly Texas, together with the blues of the American South. Bob Wills and His Texas Playboys personified this music which has been described as “a little bit of this, and a little bit of that, Sony Vaio VGN-AW41ZF/H Battery

a little bit of black and a little bit of white…just loud enough to keep you from thinking too much and to go right on ordering the whiskey.”[43] East Texan Al Dexter had a hit with “Honky Tonk Blues,” and seven years later “Pistol Packin’ Mama”.[44Sony Vaio VGN-AW41XH/Q Battery

] These “honky tonk” songs associated barrooms, were performed by the likes of Ernest Tubb, Kitty Wells (the first major female country solo singer), Ted Daffan, Floyd Tillman, and the Maddox Brothers and Rose, Lefty Frizzell and Hank Williams, would later be called “traditional” country. Williams’ influence in particular would prove to be enormousSony Vaio VGN-AW41MF/H Battery

inspiring many of the pioneers of rock and roll, such as Elvis Presley and Jerry Lee Lewis, as well as Chuck Berry and Ike Turner, while providing a framework for emerging honky tonk talents like George Jones. Sony Vaio VGN-AW41JF/H Battery

Webb Pierce was the top-charting country artist of the 1950s, with 13 of his singles spending 113 weeks at number one. He charted 48 singles during the decade; 31 reached the top ten and 26 reached the top four. Sony Vaio VGN-AW31M/H Battery

 

[edit]1950s–1960s

 

See also: 1950s in music and 1960s in music

By the early 1950s a blend of Western swing, country boogie, and honky tonk was played by most country bands. Western music, influenced by the cowboy ballads and Tejano music rhythms of the southwestern U.S. and northern Mexico, Sony Vaio VGN-AW21S Battery

reached its peak in popularity in the late 1950s, most notably with the song El Paso first recorded by Marty Robbins in September 1959.

During the mid-1950sa new style of country music became popular, eventually to be referred to as rockabilly.[45] Sony Vaio VGN-AW21M Battery

 

[edit]Rockabilly

Main article: Rockabilly

Rockabilly was most popular with country fans in the 1950s, and 1956 could be called the year of rockabilly in country music. Rockabilly was a mixture of rock-and-roll and hillbilly music. During this period Elvis Presley converted over to country music. He played a huge role in the music industry during this time. The number two Sony Vaio VGN-AW11ZR/B Battery

three and four songs on Billboard’s charts for that year were Elvis Presley, “Heartbreak Hotel”; Johnny Cash, “I Walk the Line”; and Carl Perkins, “Blue Suede Shoes”.[46] Sony Vaio VGN-AW11Z/B Battery

 

Johnny Cash

Cash and Presley placed songs in the top 5 in 1958 with No. 3 “Guess Things Happen That Way/Come In, Stranger” by Cash, and No. 5 by Presley “Don’t/I Beg Of You.”[47] Presley acknowledged the influence of rhythm and blues artists and his style, saying “The colored folk been singin’ and playin’ it just the way I’m doin’ it now Sony Vaio VGN-AW11XU/Q Battery

 

man for more years than I know.” But he also said, “My stuff is just hopped-up country.”[43] Within a few years, many rockabilly musicians returned to a more mainstream style or had defined their own unique style. Sony Vaio VGN-AW11SR/B Battery

 

Country music gained national television exposure through Ozark Jubilee on ABC-TV and radio from 1955–1960 from Springfield, Missouri. The program showcased top stars including several rockabilly artists, some from the Ozarks. As Webb Pierce put it in 1956, “Once upon a time, it was almost impossible to sell country music in a place like New York City. Sony  VGP-BPS13 Battery

Nowadays, television takes us everywhere, and country music records and sheet music sell as well in large cities as anywhere else.”[48] Sony  VAIO VGP-BPS13A/B Battery

 

The late 1950s saw the emergence of the Lubbock sound, but by the end of the decade, backlash as well as traditional artists such as Ray Price, Marty Robbins, and Johnny Horton began to shift the industry away from the rock n’ roll influences of the mid-50s. Sony  VAIO VGP-BPS13B/B Battery

 

[edit]The Nashville and ‘countrypolitan’ sounds

Main article: Nashville sound

Beginning in the mid 1950s, and reaching its peak during the early 1960s, the Nashville sound turned country music into a multimillion-dollar industry centered in Nashville, Tennessee. Under the direction of producers such as Chet Atkins, Sony  VAIO VGP-BPS13/S Battery

Owen Bradley, and later Billy Sherrill, the sound brought country music to a diverse audience and helped revive country as it emerged from a commercially fallow period.[49] Sony  VAIO VGP-BPS13A/S Battery

 

 

 

Jim Reeves

This subgenre was notable for borrowing from 1950s pop stylings: a prominent and “smooth” vocal, backed by a string section and vocal chorus. Instrumental soloing was de-emphasized in favor of trademark “licks”. Leading artists in this genre included Patsy Cline,

 

Sony Vaio VGN-NW20EF/P BatteryJim Reeves, Skeeter Davis, The Browns, and Eddy Arnold. The “slip note” piano style of session musician Floyd Cramer was an important component of this style.

Nashville’s pop song structure became more pronounced and it morphed into what was called countrypolitan. Sony  VAIO VGP-BPS13B/S Battery

Countrypolitan was aimed straight at mainstream markets and it sold well throughout the later 1960s into the early 1970s (a rarity in an era where American popular music was being decimated by the British Invasion). Top artists included Tammy Wynette, Lynn Anderson, and Charlie Rich, as well as such former “hard country” artists as Ray Price and Marty Robbins. Sony  VAIO VGP-BPS13/Q Battery

 

Despite the appeal of “The Nashville Sound”, many traditional “hard country” artists emerged during this period and dominated the genre: Loretta Lynn, Merle Haggard, Buck Owens, Porter Wagoner, and Sonny James among them.

 

Sony Vaio VGN-NW31EF Battery

[edit]Country soul – crossover

Main article: Country soul

In 1962, Ray Charles surprised the pop world by turning his attention to country and western music, topping the charts and rating number three for the year on Billboard’s pop chart[50] with the “I Can’t Stop Loving You” single, and recording the landmark album Modern Sounds in Country and Western Music. Sony  VAIO VGP-BPS13A/Q Battery

 

Sony Vaio VGN-NW31JF Battery

[edit]The Bakersfield sound

Main article: Bakersfield sound

Another genre of country music grew out of hardcore honky tonk with elements of Western swing and originated 112 miles (180 km) north-northwest of Los Angeles in Bakersfield, California. Influenced by one-time West Coast residents Bob Wills and Lefty Frizzell, Sony  VAIO VGP-BPS13B/Q Battery

by 1966 it was known as the Bakersfield sound. It relied on electric instruments and amplification, in particular the Telecaster electric guitar, more than other subgenres of country of the era, and can be described as having a sharp, hard, driving, no-frills, Sony  VGP-BPS21 Battery

edgy flavor. Leading practitioners of this style were Buck Owens, Haggard, Tommy Collins, Dwight Yoakam, Gary Allan, and Wynn Stewart, each of whom had his own style.[51][52]

 

Sony Vaio VGN-NW31ZF/S Battery

[edit]Country rock

Main article: Country rock

The late 1960s in American music produced a unique blend as a result of traditionalist backlash within separate genres. In the aftermath of the British Invasion, many desired a return to the “old values” of rock n’ roll. Sony  VGP-BPS21A Battery

At the same time there was a lack of enthusiasm in the country sector for Nashville-produced music. What resulted was a crossbred genre known as country rock.

Early innovators in this new style of music in the 60s and 70s included Bob Dylan who was the first to revert to country music with his 1967 album John Wesley Harding followed by rock n’ roll icon band The Byrds (Gram Parsons on “Sweethearts of the Rodeo”) and its spin-off The Flying Burrito Brothers (also featuring Gram Parsons), guitarist Clarence White, Sony  VGP-BPS21B Battery

Michael Nesmith (Monkees and First National Band), the Grateful Dead, Neil Young, Commander Cody, The Allman Brothers, The Marshall Tucker Band, Poco, Buffalo Springfield, and The Eagles among many. The Rolling Stones also got into the act with songs like “Honky Tonk Women” and “Dead Flowers”.Sony  VGP-BPS21/S Battery

 

Described by Allmusic as the “father of country-rock”,[53] Gram Parsons’ work in the early ’70s was acclaimed for its purity and for his appreciation for aspects of traditional country music.[54] Though his career was cut tragically short by his 1973 death, his legacy was carried on by his mentee and duet partner Emmylou Harris; Sony  VGP-BPS21A/b Battery

Harris would release her debut solo in 1975, an amalgamation of country, rock and roll, folk, blues and pop.

Subsequent to the initial blending of the two polar opposite genres, other offspring soon resulted, including Southern rock, heartland rock and in more recent years, alternative country.

 

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In the decades that followed, artists such as Juice Newton; Alabama; Hank Williams, Jr. (and, to an even greater extent, Hank Williams III); Gary Allan; Shania Twain; Brooks & Dunn; Faith Hill; Garth Brooks; Dwight Yoakam; Steve Earle; Dolly Parton; Rosanne Cash and Linda Ronstadt moved country further towards rock influence. Sony Vaio VGN-NW21MF Battery

 

[edit]Decline of Western music and the cowboy ballad

 

By the late 1960s, Western music, in particular the cowboy ballad, was in decline. Relegated to the “country and Western” genre by marketing agencies, popular Western recording stars released albums to only moderate success. Sony Vaio VGN-NW21EF Battery

Rock-and-roll dominated music sales, and Hollywood recording studios dropped most of their Western artists. The shift in country music production to Nashville also played a role, where the Nashville sound, country rock, and rockabilly music styles predominated over both ‘cowboy’ artists and the more recent Bakersfield sound. Sony Vaio VGN-NW21JF Battery The latter was largely limited to Buck Owens, Merle Haggard, and a few other bands. In the process, country and western music as a genre lost most of its southwestern, ranchera, and Tejano musical influences. However the cowboy ballad and honky-tonk music would be resurrected and reinterpreted in the 1970s with the growth in popularity of “outlaw country” music from Texas and Oklahoma.

 

Sony Vaio VGN-NW20SF Battery

 

 

[edit]1970s–1980s

 

[edit]Outlaw country

Main article: Outlaw country

Derived from the traditional Western and honky tonk musical styles of the late 1950s and 1960s, including Ray Price (whose band, the “Cherokee Cowboys”, included Willie Nelson and Roger Miller) and mixed with the anger of an alienated subculture of the nation during the period, outlaw country revolutionized the genre of country music. Sony Vaio VGN-NW20EF/S Battery

 

Willie Nelson

“After I left Nashville (the early 70s), I wanted to relax and play the music that I wanted to play, and just stay around Texas, maybe Oklahoma. Waylon and I had that outlaw image going, and when it caught on at colleges and we started selling records, we were O.K. The whole outlaw thing, it had nothing to do with the music, Sony Vaio VGN-NW20EF/W Battery

it was something that got written in an article, and the young people said, ‘Well, that’s pretty cool.’ And started listening.” (Willie Nelson)[55] Sony Vaio VGN-NW11Z/T Battery

 

The term outlaw country is traditionally associated with Hank Williams, Jr, Willie Nelson, Waylon Jennings, David Allan Coe, Whitey Morgan & The 78′s, John Prine, Billy Joe Shaver, Gary Stewart, Townes Van Zandt and with a few female vocalists such as Jessi Colter and Sammi Smith. It was encapsulated in the 1976 album Wanted! The OutlawsSony Vaio VGN-NW11Z/S Battery

A related subgenre is Red Dirt.

[edit]Country pop

Main article: Country pop

Country pop or soft pop, with roots in both the countrypolitan sound, folk music, and soft rock, is a subgenre that first emerged in the 1970s. Although the term first referred to country music songs and artists that crossed over to top 40 radio, Sony Vaio VGN-NW11S/T Battery

country pop acts are now more likely to cross over to adult contemporary music. It started with pop music singers like Glen Campbell, Bobbie Gentry, John Denver, Olivia Newton-John, Anne Murray, Marie Osmond, B. J. Thomas, The Bellamy Brothers, and Linda Ronstadt having hits on the country charts. Sony Vaio VGN-NW11S/S Battery

 

 

Lynn Anderson in concert

Between 1972 and 1975, singer/guitarist John Denver released a series of hugely successful songs blending country and folk-rock musical styles (Rocky Mountain High, Sunshine on My Shoulders, Annie’s Song, Thank God I’m a Country Boy, and I’m Sorry), and was named Country Music Entertainer of the Year in 1975. Sony Vaio VGN-NW31EF Battery

The year before, Olivia Newton-John, an Australian pop singer, won the “Best Female Country Vocal Performance” as well as the Country Music Association’s most coveted award for females, “Female Vocalist of the Year”. In response George Jones, Tammy Wynette, and other traditional Nashville country artists dissatisfied with the new trend formed the short-lived Association of Country Entertainers in 1974. Sony Vaio VGN-NW20ZF Battery

During the mid-1970s, Dolly Parton, a highly successful mainstream country artist since the late ’60s, mounted a high profile campaign to crossover to pop music, culminating in her 1977 hit “Here You Come Again”, which topped the U.S. country singles chart, and also reached No. 3 on the pop singles charts. Parton’s male counterpart, Sony Vaio VGN-NW24S Battery

Kenny Rogers came from the opposite direction, aiming his music at the country charts, after a successful career in pop, rock and folk music, achieving success the same year with “Lucille”, which topped the country charts and reached No. 5 on the U.S. pop singles charts. Parton and Rogers would both continue to have success on both country and pop charts simultaneously, well into the 1980s. Sony Vaio VGN-NW26M Battery

 

 

 

Artists like Crystal Gayle, Ronnie Milsap and Barbara Mandrell would also find success on the pop charts with their records as well.

 

 

Dolly Parton

In 1975, author Paul Hemphill stated in the Saturday Evening Post, “Country music isn’t really country anymore; it is a hybrid of nearly every form of popular music in America.”[56] Sony Vaio VGN-NW20EF Battery

 

During the early 1980s, country artists continued to see their records perform well on the pop charts. Willie Nelson and Juice Newton each had two songs in the top 5 of the Billboard Hot 100 in the early eighties: Nelson charted “Always On My Mind” (No. 5, 1982) and “To All The Girls I’ve Loved Before” (No. 5, 1984), Sony  VAIO VGN-FW21E Battery

 

and Newton achieved success with “Queen of Hearts” (No. 2, 1981) and “Angel of the Morning” (No. 4, 1981). Four country songs topped the Billboard Hot 100 in the 1980s: “Lady” by Kenny Rogers, from the late fall of 1980; “9 to 5″ by Dolly Parton, “I Love a Rainy Night” by Eddie Rabbitt (these two back-to-back at the top in early 1981); Sony  VAIO VGN-FW21I Battery

and “Islands in the Stream”, a duet by Dolly Parton and Kenny Rogers in 1983, a pop-country crossover hit written by Barry, Robin, and Maurice Gibb of the Bee Gees. Newton’s “Queen of Hearts” almost reached No. 1, Sony  VAIO VGN-FW21L Battery

but was kept out of the spot by the pop ballad juggernaut “Endless Love” by Diana Ross and Lionel Richie.[57] Although there were few crossover hits in the latter half of the 1980s, one song — Roy Orbison’s “You Got It”, from 1989 — made the top 10 of both the Billboard Hot Country Singles” and Hot 100 charts.[58][59] Sony  VAIO VGN-FW21Z Battery

 

The record-setting, multi-platinum group, Alabama, was named Artist of the Decade for the 1980s by the Academy of Country Music.

[edit]Neocountry

In 1980, a style of “neocountry disco music” was popularized by the film Urban Cowboy,[60] which also included more traditional songs such as “The Devil Went Down to Georgia” by the Charlie Daniels Band.[61] A related subgenre is Texas country music. Sony  VAIO VGN-FW21M Battery

 

Sales in record stores rocketed to $250 million in 1981; by 1984, 900 radio stations began programming country or neocountry pop full time. As with most sudden trends, however, by 1984 sales had dropped below 1979 figures.[60] Sony  VAIO VGN-FW31M Battery

 

[edit]Truck driving country

Truck driving country music is a genre of country music[62] and is a fusion of honky tonk, country-rock and Bakersfield Sound.[63] It has the tempo of country-rock and the emotion of honky-tonk,[63] and its lyrics focus on a truck driver’s lifestyle.[64] Truck driving country songs often deal with trucks and love.[63] Sony VAIO VGN-FW11J Battery

Well-known artists who sing truck driving country include Dave Dudley, Red Sovine, Dick Curless, Red Simpson, Colonel Robert Morris, The Road Hammers and Waylon Speed, with C. W. McCall and Cledus Maggard (pseudonyms of Bill Fries and Jay Huguely, respectively) being more humorous entries in the subgenre.[63] Sony VAIO VGN-FW11Z Battery

Dudley is known as the father of truck driving country.[64][65]

[edit]Neotraditionalist movement

Main article: Neotraditionalist country

During the mid-1980s, a group of new artists began to emerge who rejected the more polished country-pop sound that had been prominent on radio and the charts, in favor of more, traditional, “back-to-basics” production. Led by Randy Travis, whose 1986 debut album Storms of Life, sold four million copies and was Billboard’s year-end top country album of 1987, Sony VAIO VGN-FW11ZRU Battery

many of the artists during the latter half of the ’80s drew on traditional honky tonk, bluegrass, folk and western swing. Artists who typified this sound included Travis Tritt, Ricky Skaggs, Kathy Mattea, George Strait and The Judds. Sony VAIO VGN-FW11ZU Battery

 

[edit]1990s

 

 

 

Garth Brooks

Country music was aided by the FCC’s Docket 80-90, which led to a significant expansion of FM radio in the 1980s by adding numerous higher-fidelity FM signals to rural and suburban areas. At this point, country music was mainly heard on rural AM radio stations; the expansion of FM was particularly helpful to country music, Sony VAIO VGN-FW21J Battery

which migrated to FM from the AM band as AM became overcome by talk radio. At the same time, beautiful music stations already in rural areas began abandoning the format (leading to its effective demise) to adopt country music as well. This wider availability of country music led to producers seeking to polish their product for a wider audience. Sony VAIO VGN-FW21ZR Battery

 

In the 1990s, country music became a worldwide phenomenon thanks to Billy Ray Cyrus and Garth Brooks.[66][67][68] The latter enjoyed one of the most successful careers in popular music history, breaking records for both sales and concert attendance throughout the decade. The RIAA has certified his recordings at a combined (128× platinum), Sony VAIO VGN-FW3ZJ Battery

denoting roughly 113 million U.S. shipments.[69] Other artists that experienced success during this time included Clint Black, Sammy Kershaw, Aaron Tippin, Travis Tritt, Alan Jackson and the newly formed duo of Brooks & Dunn; George Strait, whose career began in the 1980s, also continued to have widespread success in this decade and beyond. Sony VAIO VGN-FW41E/H Battery

Toby Keith began his career as a more pop-oriented country singer in the 1990s, evolving into an outlaw persona in the late 1990s with Pull My Chain and its follow-up, Unleashed.

 

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Female artist such as Reba McEntire, Faith Hill, Martina McBride, Deana Carter, LeAnn Rimes, Shania Twain, and Mary Chapin Carpenter all released platinum selling albums in the 90s.

 

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The Dixie Chicks became one of the most popular country bands in the 90s and early 00s. Their 1998 debut album Wide Open Spaces went on to become certified 12x platinum while their 1999 album Fly went on to become 10x platinum. After their third album, Home, was released in 2003, the band’s popularity declined among country music fans, Sony VAIO VGN-FW41J/H Battery

in part because of lead singer Natalie Maines’s comments disparaging then-President George W. Bush while overseas.

In the early-mid 1990s, country western music was influenced by the popularity of line dancing. This influence was so great that Chet Atkins was quoted as saying “The music has gotten pretty bad, I think. It’s all that damn line dancing.”[70] Sony VAIO VGN-FW41M/H Battery

By the end of the decade, however, at least one line dance choreographer complained that good country line dance music was no longer being released.

[edit]2000s

 

Several rock and pop stars have ventured into country music. In 2000, Richard Marx made a brief cross-over with his Days In Avalon album, which features five country songs and several singers and musicians. Sony VAIO VGN-FW41ZJ/H Battery

Alison Krauss sang background vocals to Marx’s single “Straight From My Heart.” Also, Bon Jovi had a hit single, “Who Says You Can’t Go Home”, with Jennifer Nettles of Sugarland. Singer song writer Unknown Hinson became famous for his appearance in the Charlotte television show Wild,Wild, South. Sony VAIO VGN-FW46M Battery

After which Unknown Hinson started his own band and toured in southern states. Other rock stars who featured a country song on their albums were Don Henley and Poison.

One infrequent, but consistent theme in modern country music is that of proud, stubborn individualism. “Country Boy Can Survive” and “Copperhead Road”[71] Sony VAIO VGN-FW4ZTJ/H Battery

are two of the more serious songs along those lines; while “Some Girls Do”[72] and “Redneck Woman”[73] are more light-hearted variations on the theme.

 

 

Carrie Underwood

 

 

Taylor Swift

In 2005, country singer Carrie Underwood rose to fame as the winner of the fourth season of American Idol and became a multi-platinum selling recording artist and multiple Grammy Award winner. With her first single, Sony VAIO VGN-FW51 Battery “Inside Your Heaven”, Underwood became the only country artist to have a #1 Hit on Billboard Hot 100 Songs chart in the 2000-2009 decade. In 2007, Underwood won the Grammy Award for Best New Artist and became the first country artist in 10 years to win such award and the second of only three to ever win it. Underwood also made history by becoming the seventh woman to win Entertainer Of The Year for the Academy of Country Music Awards, Sony Vaio VGN-SR49VN/H Battery

Sony Vaio VGN-FW56Z Battery

and the first woman in history to win Entertainer of the Year for the Academy of Country Music Awards twice, as well as twice consecutively. Underwood’s debut album, “Some Hearts”, was not only the fastest-selling debut album by any country artist in history, Sony Vaio VGN-SR57S Battery

but was ranked by Billboard.com as the #1 Country Album of the 2000-2009 decade.

Underwood was one of several country stars produced by a television series in the 2000s. In addition to Underwood, American Idol launched the careers of Kellie Pickler, Josh Gracin, Bucky Covington, Kristy Lee Cook, Sony Vaio VGN-SR57V Battery

and Danny Gokey (as well as that of occasional country singer Kelly Clarkson) in the decade, and would continue to launch country careers in the 2010s. The series Nashville Star, while not nearly as successful as Idol, did manage to bring Miranda Lambert and Chris Young to mainstream success, Sony Vaio VGN-SR57X Battery

also launching careers of lower-profile musicians such as Buddy Jewell, Sean Patrick McGraw, and Canadian musician George Canyon. Can You Duet? produced the duo Steel Magnolia and the one-hit wonder Joey & Rory. Sony Vaio VGN-SR59TH/H Battery

 

Teen sitcoms also have had an impact on modern country music; in 2008, actress Jennette McCurdy (best known as the sidekick Sam on the teen sitcom iCarly) released her first single, “So Close;” following that with the single “Generation Love” in 2011. Another teen sitcom star, Miley Cyrus (of Hannah Montana), Sony Vaio VGN-SR59VG/H Battery

also had a crossover hit in the late 2000s with “The Climb” and another with a duet with her father, Billy Ray Cyrus, with “Ready, Set, Don’t Go.” Jana Kramer, an actress in teen drama One Tree Hill, released a country song in 2012. Sony Vaio VGN-SR59XG/H Battery

 

In 2008, Taylor Swift rose as a major country-pop artist, with her single “Love Story” becoming the first country song to reach No. 1 one on the Nielsen BDS CHR/Top 40 chart. Another of her singles, “You Belong with Me”, also reached No. 1, Sony Vaio VGN-FW56ZR Battery

making Swift the only country artist to have two No. 1 singles atop the chart. Both “Love Story” and “You Belong with Me” became the best-selling country song of all time, with “Love Story” in the first position with a domestic total of 5.2 million digital copies sold, and “You Belong with Me” in the second with 4 million sales, respectively. Sony Vaio VGN-FW56SR Battery

In 2010, Swift’s second album “Fearless” was awarded the Grammy Award for Album of the Year, becoming the first album in history to win the American Music Award (AMA), Academy of Country Music Award (ACM), Country Music Association Award (CMA), and the Grammy Award for Album of the Year in the same year. Sony Vaio VGN-SR49VT/H Battery

In the same year, Hootie & the Blowfish vocalist Darius Rucker released his second solo album and country music debut, Learn to Live. The first three singles from that album all debuted at No. 1, making Rucker the first solo artist to debut with three No. 1 hits in over a decade. He is also the first African American with a No. 1 country hit since Charley Pride in 1983. Sony Vaio VPCEA1S1E/P Battery

 

 

In 2011, Toby Keith was named Artist of the Decade by the Academy of Country Music.

[edit]2010s

 

In 2010, the group Lady Antebellum won five Grammys, including the coveted Song of the Year and Record of the Year for “Need You Now”.[74] Also in 2010, Taylor Swift’s third multi-platinum album Speak Now sold 1,041,000 copies in its first week.[citation needed] Sony Vaio VPCEA1S1E/L Battery

 

A large number of duos and vocal groups have begun to emerge on the charts in the 2010s, many of which feature close harmony in the lead vocals. In addition to Lady Antebellum, groups such as The Band Perry, Gloriana, Thompson Square, Eli Young Band and the Zac Brown Band have emerged to occupy a large portion of the new country artists in the popular scene.

 

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[edit]International

 

[edit]Canada

This unreferenced section requires citations to ensure verifiability.

Main articles: Canadian Country Music Association and Canadian Country Music Hall of Fame

Outside of the US, Canada has the largest country music fan and artist base. Mainstream country music is culturally ingrained in the Maritimes and the prairie provinces: Sony Vaio VPCEA1S1E/G Battery

areas with large numbers of rural residents. Canadian country music originated in Atlantic Canada in the form of British and Irish folk music popular amongst Irish and Scottish immigrants to Canada’s Maritime Provinces (Nova Scotia, New Brunswick, and Prince Edward Island). Like the southern United States and Appalachia, Sony Vaio VPCEA2S1E/B Battery

all three regions are of heavy British Isles stock and rural; as such, The development of country music in the Maritimes mirrored the development of country music in the US south and Appalachia. Sony Vaio VPCEA2S1E/L Battery

 

Don Messer’s Jubilee was a Halifax, Nova Scotia based country/folk variety television show that was broadcast nationally from 1957 to 1969. It out drew the Ed Sullivan Show from the United States and became the #1 rated television show in Canada throughout much of the 1960s. Don Messer’s Jubilee followed a consistent format throughout its years, Sony Vaio VPCEA181 Battery

beginning with a tune named “Goin’ to the Barndance Tonight”, followed by fiddle tunes by Messer, songs from some of his “Islanders” including singers Marg Osburne and Charlie Chamberlain, the featured guest performance, and a closing hymn. It ended with “Till We Meet Again”.Sony Vaio VGP-BPS22 Battery

The guest performance slot gave national exposure to numerous Canadian folk musicians, including Stompin’ Tom Connors and Catherine McKinnon. Some Maritime country performers went on to further fame beyond Canada. Hank Snow, Wilf Carter (also known as Montana Slim), and Anne Murray are the three most notable. Sony  VAIO VGN-FZ38M Battery

 

The cancellation of the show by the public broadcaster in 1969 caused a nationwide protest, including the raising of questions in the Canadian parliament. Sony Vaio VGN-NR31E/S Battery

 

Despite country’s roots in the Maritimes, many traditional country artists are present in Eastern and Western Canada. They make common use of fiddle and pedal steel guitar styles. Some notable Canadian country artists include: Shania Twain, Blue Rodeo, Marg Osburne, Hank Snow, Johnny Mooring, Don Messer, Doc Walker, Sony Vaio VGN-NR31ER/S Battery

Sony Vaio VGN-NR31J/S Battery

Emerson Drive, Paul Brandt, The Wilkinsons, Wilf Carter, Michelle Wright, Corb Lund and the Hurtin’ Albertans, Stompin’ Tom Connors, Terri Clark, Crystal Shawanda, Shane Yellowbird, The Road Hammers, Anne Murray, and Prairie Oyster and The Higgins. Sony Vaio VGN-NR31MR/S Battery

 

[edit]Australia

Main article: Australian country music

 

 

Olivia Newton-John singing in Sydney in 2008.

Australian country music has a long tradition. Influenced by American country music it has developed a distinct style, shaped by British and Irish folk ballads and Australian bush balladeers like Henry Lawson and Banjo Paterson. Sony Vaio VGN-NR31S/S Battery

Country instruments, including the guitar, banjo, fiddle and harmonica create the distinctive sound of country music in Australia and accompany songs with strong storyline and memorable chorus. Sony Vaio VGN-NR31SR/S Battery

 

Folk songs sung in Australia between the 1780s and 1920s based around such themes as the struggle against government tyranny, or the lives of bushrangers, swagmen, drovers, stockmen and shearers continue to influence the genre. This strain of Australian country, with lyrics focusing on Australian subjects, Sony Vaio VGN-NR31Z/S Battery

is generally known as “bush music” or “bush band music”. Waltzing Matilda, often regarded as Australia’s unofficial National anthem, is a quintessential Australian country song, influenced more by British and Irish folk ballads than by American Country and Western music. The lyrics were composed by the poet Banjo Paterson in 1895. Sony Vaio VGN-NR31Z/T Battery

Other popular songs from this tradition include The Wild Colonial Boy, Click Go The Shears, The Queensland Drover and The Dying Stockman. Later themes which endure to the present include the experiences of war, of droughts and flooding rains, Sony Vaio VGN-NR31ZR/S Battery

of Aboriginality and of the railways and trucking routes which link Australia’s vast distances.[75][76]

Pioneers of a more Americanised popular country music in Australia included Tex Morton (known as The Father of Australian Country Music) in the 1930s and other early stars like Buddy Williams, Shirley Thoms and Smoky Dawson. In 1952, Sony Vaio VGN-NR38E/S Battery

Dawson began a radio show, and went on to national stardom as a singing cowboy of radio, TV and film.

Slim Dusty (1927–2003) was known as the King of Australian Country Music, and helped to popularise the Australian bush ballad. His successful career spanned almost six decades and his 1957 hit “Pub With No Beer” was the biggest-selling record by an Australian to that time,

 

Sony Vaio VGN-NR31E/S Battery and with over seven million record sales in Australia he is the most successful artist in Australian musical history[77] Dusty recorded and released his one-hundredth album in the year 2000 and was given the honour of singing Waltzing Matilda in the closing ceremony of the Sydney 2000 Olympic Games. Dusty’s wife Joy McKean penned several of his most popular songs. Sony Vaio VGN-NR38M/S Battery

 

Chad Morgan, who began recording in the 1950s has represented a vaudeville style of comic Australian country; Frank Ifield achieved considerable success in the early 1960s, especially in the UK Singles Charts and Reg Lindsay was one of the first Australians to perform at Nashville’s Grand Ole Opry in 1974.[78] Sony Vaio VGN-NR38S/S Battery

Eric Bogle’s 1972 folk lament to the Gallipoli campaign “And The Band Played Waltzing Matilda” recalled the British and Irish origins of Australian folk-country. Singer-songwriter Paul Kelly whose music style straddles folk, rock, and country is often described as the poet laureate of Australian music.[79] Sony Vaio VGN-NR38Z/S Battery

 

 

Keith Urban in 2007

By the 1990s, country music had attained cross-over success in the pop charts with artists like James Blundell and James Reyne singing “Way Out West”, and country star Kasey Chambers winning the ARIA for Best Female Artist in 2003. Sony Vaio VGN-NR38Z/T Battery

The cross-over influence of Australian country is also evident in the music of successful contemporary bands The Waifs and The John Butler Trio. Nick Cave has been heavily influenced by the country artist Johnny Cash. In 2000, Cash, covered Cave’s “The Mercy Seat” on the album American III: Solitary Man, Sony Vaio VGN-SR49VN/H Battery

seemingly repaying Cave for the compliment he paid by covering Cash’s “The Singer” (originally “The Folk Singer”) on his Kicking Against the Pricks album. Subsequently, Cave cut a duet with Cash on a version of Hank Williams’ “I’m So Lonesome I Could Cry” for Cash’s American IV: The Man Comes Around album (2002).[80] Sony Vaio VGN-FW56Z Battery

 

Popular contemporary performers of Australian country music include: John Williamson (who wrote the iconic “True Blue”), Lee Kernaghan (whose hits include “Boys From the Bush” and “the Outback Club”), Gina Jeffreys and Sara Storer. In the USA, Olivia Newton John, Sherrié Austin and Keith Urban have attained great success. Sony Vaio VGN-SR57S Battery

Ruby Hunter and Archie Roach at the 2009 Tamworth Country Music Festival.

Country music has also been a particularly popular form of musical expression among Indigenous Australians. Troy Cassar-Daley is among Australia’s successful contemporary indigenous performers Aboriginal artists and Kev Carmody and Archie Roach employ a combination of folk-rock and country music to sing about Aboriginal rights issues.[81] Sony Vaio VGN-SR57V Battery

 

The Tamworth Country Music Festival began in 1973 and now attracts up to a 100,000 visitors annually. Held in Tamworth, New South Wales (Country music capital of Australia), it celebrates the culture and heritage of Australian country music. During the festival the CMAA holds the Country Music Awards of Australia ceremony awarding the Golden Guitar trophies.

 

Sony Vaio VGN-SR49VT/H Battery

 

 

 

Other significant country music festivals include the Whittlesea Country Music Festival (near Melbourne) and Boyup Brook Country Music Festival (Western Australia) in February; the Bamera Country Music Festival in June (South Australia), the National Country Muster held in Gympie during August, Sony Vaio VGN-SR57X Battery

Mildura Country Music Festival for “independent” performers during October and the Canberra Country Music Festival held in the national capital during November. Some festivals are quite unique in their location: Grabine State Park in New South Wales promotes Australian country through the Grabine Music Muster Festival; Sony Vaio VGN-SR59TH/H Battery

Marilyns Country Music Festival is a unique event held in South Australia’s Smoky Bay in September and is the only music festival in the world using an oyster barge as a stage. Sony Vaio VGN-SR59VG/H Battery

 

Country HQ showcases new talent on the rise in the country music scene downunder. CMC (the Country Music Channel), a 24 hour music channel dedicated to non-stop country music, can be viewed on pay tv and features once a year the Golden Guitar Awards, Sony Vaio VGN-SR59XG/H Battery

CMAs and CCMAs alongside international shows such as The Wilkinsons, The Road Hammers, and Country Music Across America.

[edit]Other international country music

Tom Roland, from the Country Music Association International, explains Country Music’s global popularity: “In this respect, at least, Country Music listeners around the globe have something in common with those in the United States. In Germany, Sony Vaio VGN-FW56ZR Battery

for instance, Rohrbach identifies three general groups that gravitate to the genre: people intrigued with the American cowboy icon, middle-aged fans who seek an alternative to harder rock music and younger listeners drawn to the pop-influenced sound that underscores many current Country hits.”[82] Sony Vaio VGN-FW56SR Battery

One of the first Americans to perform country music abroad was George Hamilton IV. He was the first country musician to perform in the Soviet Union; he also toured in Australia and the Middle East. He was deemed the “International Ambassador of Country Music” for his contributions to the globalization of country music.[83] Johnny Cash, Sony VGN-P11Z/Q Battery

Emmylou Harris, Keith Urban, and Dwight Yoakam have also made numerous international tours.[82]

The Country Music Association undertakes various initiatives to promote country music internationally.[82] Sony VGN-P11Z/R Battery

 

In the United Kingdom, a country-derived genre known as skiffle peaked in the 1950s thanks to the efforts of Lonnie Donegan; though the genre as a whole was very short-lived, most of the bands involved with the British Invasion began their careers as skiffle musicians.[84] Sony VGN-P11Z/W Battery

 

In South America, on the last weekend of September, the yearly “San Pedro Country Music Festival”[85] takes places in the town of San Pedro, Argentina. The festival features bands from different places of Argentina, as well as international artist from Brazil, Uruguay, Chile, Peru and the United States. Sony VGN-P21S/W Battery

 

Sony VPCW12S1E/W Battery

In India, the Anglo-Indian community is well known for enjoying and performing country music. An annual concert festival called “Blazing Guitars”[86] held in Chennai brings together Anglo-Indian musicians from all over the country (including some who have emigrated to places like Australia). Sony VGN-P21Z/G Battery

 

In Ireland TG4 began a quest for Ireland’s next country star called Glór Tíre, translated as Country Voice, it is now in its 6th season and is one of TG4 most watched TV shows. A recent success in the Irish arena has been Crystal Swing. Sony VGN-P21Z/R Battery

 

In Sweden, Rednex rose to stardom combining country music with electro-pop in the 1990s. In 1994, the group had a worldwide hit with their version of the traditional Southern tune “Cotton-Eyed Joe”. Other notable Swedish country acts include Jill Johnson and Calaisa.

 

Sony VPCW12S1E/T Battery

Rhodesia during the 1970s had an active country and western music scene. Many songs combined country ballads with patriotic or military inspired lyrics. For example, Clem Tholet’s Rhodesians Never Die rose to the top of the Rhodesian pop charts. Sony VGN-P29VN/Q Battery

 

In Poland since 1983 international country music festival, known as Piknik Country (picnic country), is organized in Mrągowo on Masuria. Sony VGP-BPS18 Battery

 

Sony VPCW12S1E/P Battery

In France since 1991 a huge international country music festival known as Country Rendez-Vous is organized in Craponne-sur-Arzon. There’s more and more country music artists in France. Some of the most importants are Liane Edwards, Annabel, Rockie Mountains, Tahiana, Lili West. French rock and roll superstar Eddy Mitchell is also very inspired by Americana and country music. Sony VGP-BPL18 Battery

 

[edit]Performers and shows

 

Main articles: List of country music performers, List of country performers by era, and List of country television and radio shows

[edit]US cable television

Five U.S. cable TV networks are at least partly devoted to the genre: CMT and CMT Pure Country (both owned by Viacom), Rural Free Delivery TV (owned by Rural Media Group), GAC (owned by The E. W. Scripps Company), Sony VGP-BPL18 Battery

and The Country Network (a privately owned channel distributed by Sinclair Broadcast Group). The first American country music video cable channel was The Nashville Network, launched in the early 1980s. In 2000, the channel was renamed and reformatted as The National Network, a general-interest network, and eventually became Spike TV. Sony VPCW11S1E/P Battery

 

[edit]Canadian television

Only one television channel is currently dedicated to country music in Canada and that is CMT (Canada) owned by Corus Entertainment (90%) and Viacom (10%). But in the past the show Don Messer’s Jubilee had great impact on country music in Canada in fact it is the program that launched Anne Murray’s career. Sony VPCW11S1E/P Battery

 

[edit]Australian cable television

The only network dedicated to Country Music in Australia is the Country Music Channel owned by XYZnetworks.

———————————————————————–

Electronic music is music that employs electronic musical instruments and electronic music technology in its production. In general a distinction can be made between sound produced using electromechanical means and that produced using electronic technology.[1] Sony VPCW11S1E/T Battery

Examples of electromechanical sound producing devices include the telharmonium, Hammond organ, and the electric guitar. Purely electronic sound production can be achieved using devices such as the Theremin, sound synthesizer, and computer.[2] Sony VPCW11S1E/W Battery

Electronic music was once associated almost exclusively with Western art music but from the late 1960s on the availability of affordable music technology meant that music produced using electronic means became increasingly common in the popular domain.[3] Sony  VAIO VGN-FW21E Battery

Today electronic music includes many varieties and ranges from experimental art music to popular forms such as electronic dance music.

The ability to record sounds is often connected to the production of electronic music, but not absolutely necessary for it. The earliest known sound recording device was the phonautograph, patented in 1857 by Édouard-Léon Scott de Martinville. Sony  VAIO VGN-FW21I Battery

It could record sounds visually, but was not meant to play them back.[4]

In 1878, Thomas A. Edison patented the phonograph, which used cylinders similar to Scott’s device. Although cylinders continued in use for some time, Emile Berliner developed the disc phonograph in 1887.[5] Sony  VAIO VGN-FW21L Battery

A significant invention, which was later to have a profound effect on electronic music, was Lee DeForest’s triode audion. This was the first thermionic valve, or vacuum tube, invented in 1906, which led to the generation and amplification of electrical signals, radio broadcasting, and electronic computation, amongst other things. Sony  VAIO VGN-FW21Z Battery

 

 

Before electronic music, there was a growing desire for composers to use emerging technologies for musical purposes. Several instruments were created that employed electromechanical designs and they paved the way for the later emergence of electronic instruments. An electromechanical instrument called the Telharmonium (sometimes Teleharmonium or Dynamophone) was developed by Thaddeus Cahill in the years 1898–1912. Sony  VAIO VGN-FW21M Battery

 

However, simple inconvenience hindered the adoption of the Telharmonium, due to its immense size. The first electronic instrument is often viewed to be the Theremin, invented by Professor Léon Theremin circa 1919–1920.[6] Sony  VAIO VGN-FW31M Battery

Other early electronic instruments include the Croix Sonore, invented in 1926 by Nikolai Obukhov, and the Ondes Martenot, which was most famously used in the Turangalîla-Symphonie by Olivier Messiaen as well as other works by him. The Ondes Martenot was also used by other, primarily French, composers such as Andre Jolivet.[7] Sony  VAIO VGN-FW31J Battery

 

[edit]Sketch of a New Esthetic of Music

Main article: Ferruccio Busoni

In 1907, just a year after the invention of the triode audion, Ferruccio Busoni published Sketch of a New Esthetic of Music, which discussed the use of electrical and other new sound sources in future music. Sony VAIO VGN-FW11ZRU Battery

He wrote of the future of microtonal scales in music, made possible by Cahill’s Dynamophone: “Only a long and careful series of experiments, and a continued training of the ear, can render this unfamiliar material approachable and plastic for the coming generation, and for Art.”[8]

 

Sony VAIO VGN-FW54M Battery

Also in the Sketch of a New Esthetic of Music, Busoni states:

Music as an art, our so-called occidental music, is hardly four hundred years old; its state is one of development, perhaps the very first stage of a development beyond present conception, and we—we talk of “classics” and “hallowed traditions”!Sony VAIO VGN-FW11ZU Battery

And we have talked of them for a long time!

We have formulated rules, stated principles, laid down laws;—we apply laws made for maturity to a child that knows nothing of responsibility! Sony VAIO VGN-FW21ER Battery

 

Young as it is, this child, we already recognize that it possesses one radiant attribute which signalizes it beyond all its elder sisters. And the lawgivers will not see this marvelous attribute, lest their laws should be thrown to the winds. Sony VAIO VGN-FW21J Battery

 

Sony VAIO VGN-FW51ZF/H Battery This child—it floats on air! It touches not the earth with its feet. It knows no law of gravitation. It is well nigh incorporeal. Its material is transparent. It is sonorous air. It is almost Nature herself. It is—free!

But freedom is something that mankind have never wholly comprehended, never realized to the full. They can neither recognize or acknowledge it. Sony VAIO VGN-FW3ZJ Battery

 

They disavow the mission of this child; they hang weights upon it. This buoyant creature must walk decently, like anybody else. It may scarcely be allowed to leap—when it were its joy to follow the line of the rainbow, and to break sunbeams with the clouds.[9] Sony VAIO VGN-FW21ZR

 

Through this writing, as well as personal contact, Busoni had a profound effect on many musicians and composers, perhaps most notably on his pupil, Edgard Varèse, who said:

Together we used to discuss what direction the music of the future would, or rather, should take and could not take as long as the straitjacket of the tempered system. Sony VAIO VGN-FW46M Battery

He deplored that his own keyboard instrument had conditioned our ears to accept only an infinitesimal part of the infinite gradations of sounds in nature. He was very much interested in the electrical instruments we began to hear about, Sony VAIO VGN-FW4ZTJ/H

and I remember particularly one he had read of called the Dynamophone. All through his writings one finds over and over again predictions about the music of the future which have since come true. In fact, there is hardly a development that he did not foresee, as for instance in this extraordinary prophecy: Sony VAIO VGN-FW51 Battery

I almost think that in the new great music, machines will also be necessary and will be assigned a share in it. Perhaps industry, too, will bring forth her share in the artistic ascent.’[10]

[edit]Futurists

Main article: Futurism (music)

In Italy, the Futurists approached the changing musical aesthetic from a different angle. A major thrust of the Futurist philosophy was to value “noise,” and to place artistic and expressive value on sounds that had previously not been considered even remotely musical. Sony VAIO VGN-FW51MF/H Battery ‘ Balilla Pratella’s “Technical Manifesto of Futurist Music” (1911) states that their credo is: “To present the musical soul of the masses, of the great factories, of the railways, of the transatlantic liners, of the battleships, SONY VGN-FW41E/H BATTERY

 

Sony VAIO VGN-NW21ZF/S Battery

of the automobiles and airplanes. To add to the great central themes of the musical poem the domain of the machine and the victorious kingdom of Electricity.”[11]

On 11 March 1913, futurist Luigi Russolo published his manifesto “The Art of Noises”. In 1914, he held the first “art-of-noises” concert in Milan on April 21. This used his Intonarumori, described by Russolo as “acoustical noise-instruments, whose sounds (howls, SONY VGN-FW41J/H BATTERY

roars, shuffles, gurgles, etc.) were hand-activated and projected by horns and megaphones.”[12] In June, similar concerts were held in Paris.

[edit]The 1920s to 1930s

Further information: Electronic musical instrument and Léon Theremin

See also: Graphical sound, Trautonium, and Harald Bode

This decade brought a wealth of early electronic instruments and the first compositions for electronic instruments. The first instrument, the Etherophone, SONY VGN-FW41M/H BATTERY

was created by Léon Theremin (born Lev Termen) between 1919 and 1920 in Leningrad, though it was eventually renamed the Theremin. This led to the first compositions for electronic instruments, as opposed to noisemakers and re-purposed machines. In 1929, Joseph Schillinger composed First Airphonic Suite for Theremin and Orchestra, premièred with the Cleveland Orchestra with Leon Theremin as soloist. SONY VGN-FW41ZJ/H BATTERY

 

In addition to the Theremin, the Ondes Martenot was invented in 1928 by Maurice Martenot, who debuted it in Paris.[13]

The following year, Antheil first composed for mechanical devices, electrical noisemakers, motors and amplifiers in his unfinished opera, Mr. Bloom. Sony VAIO VGN-NW31JF/S Battery

 

Recording of sounds made a leap in 1927, when American inventor J. A. O’Neill developed a recording device that used magnetically coated ribbon. However, this was a commercial failure. Two years later, Laurens Hammond established his company for the manufacture of electronic instruments. He went on to produce the Hammond organ, Sony VAIO VGN-NW21ZF/T Battery

which was based on the principles of the Telharmonium, along with other developments including early reverberation units.[14] Hammond (along with John Hanert and C. N. Williams) would also go on to invent another electronic instrument, the Novachord, which Hammond’s company manufactured from 1939–1942.[15] Sony VAIO VGN-NW21ZF/S Battery

 

The method of photo-optic sound recording used in cinematography made it possible to obtain a visible image of a sound wave, as well as to realize the opposite goal—synthesizing a sound from an artificially drawn sound wave. Sony VAIO VGN-NW21MF/W Battery

 

In this same period, experiments began with sound art, early practitioners of which include Tristan Tzara, Kurt Schwitters, Filippo Tommaso Marinetti, and others.

[edit]Development: 1940s to 1950s

 

[edit]Electroacoustic tape music

See also: Electroacoustic music and Tape music

 

 

Halim El-Dabh at a Cleveland festival in 2009.

Low-fidelity magnetic wire recorders had been in use since around 1900[16] and in the early 1930s the movie industry began to convert to the new optical sound-on-film recording systems based on the photoelectric cell.[17] Sony VAIO VGN-NW21MF/P Battery

It was around this time that the German electronics company AEG developed the first practical audio tape recorder, the “Magnetophon” K-1, which was unveiled at the Berlin Radio Show in August 1935.[18] Sony VAIO VGN-NW21JF/S Battery

 

During World War II, Walter Weber rediscovered and applied the AC biasing technique, which dramatically improved the fidelity of magnetic recording by adding an inaudible high-frequency tone. It extended the 1941 ‘K4′ Magnetophone frequency curve to 10 kHz and improved the dynamic range up to 60 dB,[19] surpassing all known recording systems at that time.[20] Sony VAIO VGN-NW11S/S Battery

 

As early as 1942 AEG was making test recordings in stereo.[21] However these devices and techniques remained a secret outside Germany until the end of WWII, when captured Magnetophon recorders and reels of Farben ferric-oxide recording tape were brought back to the United States by Jack Mullin and others.[22] Sony VAIO VGN-NW11S/T Battery

These captured recorders and tapes were the basis for the development of America’s first commercially made professional tape recorder, the Model 200, manufactured by the American Ampex company[23] Sony VAIO VGN-NW11Z/T Battery

with support from entertainer Bing Crosby, who became one of the first performers to record radio broadcasts and studio master recordings on tape.[24]

Magnetic audio tape opened up a vast new range of sonic possibilities to musicians, composers, producers and engineers. Sony VAIO VGN-NW11Z/S Battery

Audio tape was relatively cheap and very reliable, and its fidelity of reproduction was better than any audio medium to date. Most importantly, unlike discs, it offered the same plasticity of use as film. Tape can be slowed down, sped up or even run backwards during recording or playback, with often startling effect. It can be physically edited in much the same way as film, allowing for unwanted sections of a recording to be seamlessly removed or replaced; Sony VAIO VGN-NW31JF/S Battery

likewise, segments of tape from other sources can be edited in. Tape can also be joined to form endless loops that continually play repeated patterns of pre-recorded material. Audio amplification and mixing equipment further expanded tape’s capabilities as a production medium, allowing multiple pre-taped recordings (and/or live sounds, Sony VAIO VGN-NW21ZF/T Battery  speech or music) to be mixed together and simultaneously recorded onto another tape with relatively little loss of fidelity. Another unforeseen windfall was that tape recorders can be relatively easily modified to become echo machines that produce complex, Sony VAIO VGN-NW21MF/W Battery

 

controllable, high-quality echo and reverberation effects (most of which would be practically impossible to achieve by mechanical means).

The spread of tape recorders eventually led to the development of electroacoustic tape music. The first known example was composed in 1944 by Halim El-Dabh, Sony VAIO VGN-NW21MF/P Battery

a student at Cairo, Egypt.[25] He recorded the sounds of an ancient zaar ceremony using a cumbersome wire recorder and at the Middle East Radio studios processed the material using reverberation, echo, voltage controls, and re-recording. Sony VAIO VGN-NW20EF/P Battery

The resulting work was entitled The Expression of Zaar and it was presented in 1944 at an art gallery event in Cairo. While his initial experiments in tape based composition were not widely known outside of Egypt at the time, El-Dabh is also notable for his later work in electronic music at the Columbia-Princeton Electronic Music Center in the late 1950s.[26] Sony VAIO VGN-NW20EF/w Battery

 

[edit]Musique concrète

Main article: Musique concrète

See also: Acousmatic music

It wasn’t long before composers in Paris also began using the tape recorder to develop a new technique for composition called Musique concrète. This technique involved editing together recorded fragments of natural and industrial sounds.[27] The first pieces of musique concrète in Paris were assembled by Pierre Schaeffer, who went on to collaborate with Pierre Henry.

 

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On 5 October 1948, Radiodiffusion Française (RDF) broadcast composer Pierre Schaeffer’s Etude aux chemins de fer. This was the first “movement” of Cinq études de bruits, and marked the beginning of studio realizations[28Sony VAIO VGN-NW20EF/S Battery

] and musique concrète (or acousmatic art). Schaeffer employed a disk-cutting lathe, four turntables, a four-channel mixer, filters, an echo chamber, and a mobile recording unit. Not long after this, Henry began collaborating with Schaeffer, Sony VAIO VGN-NW31EF Battery

a partnership that would have profound and lasting effects on the direction of electronic music. Another associate of Schaeffer, Edgard Varèse, began work on Déserts, a work for chamber orchestra and tape. The tape parts were created at Pierre Schaeffer’s studio, and were later revised at Columbia University. Sony VAIO VGN-NW31ZF/S Battery

 

In 1950, Schaeffer gave the first public (non-broadcast) concert of musique concrète at the Ecole Normale de Musique de Paris. “Schaeffer used a PA system, several turntables, and mixers. The performance did not go well, as creating live montages with turntables had never been done before.”[29] Later that same year, Sony VAIO VGN-NW21JF/S Battery 

Pierre Henry collaborated with Schaeffer on Symphonie pour un homme seul (1950) the first major work of musique concrete. In Paris in 1951, in what was to become an important worldwide trend, RTF established the first studio for the production of electronic music. Also in 1951, Schaeffer and Henry produced an opera, Orpheus, for concrete sounds and voices. Sony Vaio VGN-AW41ZF/B Battery

x Musik

 

 

Karlheinz Stockhausen in the Electronic Music Studio of WDR, Cologne, in 1991

Karlheinz Stockhausen worked briefly in Schaeffer’s studio in 1952, and afterward for many years at the WDR Cologne’s Studio for Electronic Music. Sony Vaio VGN-AW41ZF/B Battery

 

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In Cologne, what would become the most famous electronic music studio in the world was officially opened at the radio studios of the NWDR in 1953, though it had been in the planning stages as early as 1950 and early compositions were made and broadcast in 1951.[30] The brain child of Werner Meyer-Eppler, Robert Beyer, Sony Vaio VGN-AW41XH/Q Battery

and Herbert Eimert (who became its first director), the studio was soon joined by Karlheinz Stockhausen and Gottfried Michael Koenig. In his 1949 thesis Elektronische Klangerzeugung: Elektronische Musik und Synthetische Sprache, Meyer-Eppler conceived the idea to synthesize music entirely from electronically produced signals; Sony Vaio VGN-AW41MF/H Battery

in this way, elektronische Musik was sharply differentiated from French musique concrète, which used sounds recorded from acoustical sources.[31]

With Stockhausen and Mauricio Kagel in residence, it became a year-round hive of charismatic avante-gardism [sic]“[32] Sony Vaio VGN-AW41JF/H Battery

on two occasions combining electronically generated sounds with relatively conventional orchestras—in Mixtur (1964) and Hymnen, dritte Region mit Orchester (1967).[33] Stockhausen stated that his listeners had told him his electronic music gave them an experience of “outer space,” sensations of flying, or being in a “fantastic dream world”[34] Sony Vaio VGN-AW31ZJ/B Battery

More recently, Stockhausen turned to producing electronic music in his own studio in Kürten, his last work in the genre being Cosmic Pulses (2007).

[edit]Japanese electronic music

 

This section may be confusing or unclear to readers. Please help clarify the section; suggestions may be found on the talk page. (March 2012) Sony Vaio VGN-AW31S/B Battery

 

While early electric instruments such as the Ondes Martenot, Theremin and Trautonium were little known in Japan prior to World War II,[neutrality is disputed] certain composers such as Minao Shibata had known about them at the time. Several years after the end of World War II, musicians in Japan began experimenting with electronic music, Sony Vaio VGN-AW31M/H Battery

resulting in some of the most dedicated efforts due to institutional sponsorship enabling composers to experiment with the latest audio recording and processing equipment. These efforts represented an infusion of Asian music into the emerging genre and would eventually pave the way for Japan’s domination in the development of music technology several decades later.[35] Sony Vaio VGN-AW31XY/Q Battery

 

Following the foundation of electronics company Sony (then called Tokyo Tsushin Kogyo K.K.) in 1946, two Japanese composers, Toru Takemitsu and Minao Shibata, independently wrote about the possible use of electronic technology to produce music during the late 1940s.[36] Sony Vaio VGN-AW21Z/B Battery

In 1948, Takemitsu conceived of a technology that would “bring noise into tempered musical tones inside a busy small tube,” an idea similar to Pierre Schaeffer’s musique concrète the same year, which Takemitsu was unaware of until several years later. In 1949, Sony Vaio VGN-AW21XY/Q Battery

Shibata wrote about his concept of “a musical instrument with very high performance” that can “synthesize any kind of sound waves” and is “operated very easily,” predicting that with such an instrument, “the music scene will be changed drastically.”[37] Sony Vaio VGN-AW21S Battery

The same year, Sony developed the magnetic tape recorder G-Type,[38] which became a popular recording device for use in courtrooms and government offices, leading to Sony releasing the H-Type for home use by 1951.[35] Sony Vaio VGN-AW21M Battery

 

In 1950, the Jikken Kobo (Experimental Workshop) electronic music studio would be founded by a group of musicians in order to produce experimental electronic music using Sony tape recorders. It included musicians such as Toru Takemitsu, Sony Vaio VGN-AW11RXU/Q Battery

Kuniharu Akiyama, and Joji Yuasa, and was supported by Sony, which offered them access to the latest audio technology, hired Takemitsu to compose electronic tape music to demonstrate their tape recorders, and sponsored concerts.[39] Sony Vaio VGN-AW11ZR/B Battery

The first electronic tape music from the group were “Toraware no Onna” (“Imprisoned Woman”) and “Piece B”, completed in 1951 by Kuniharu Akiyama.[40] Many of the electroacoustic tape pieces they produced were usually used as incidental music for radio, film, and theatre. They also held concerts such as 1953′s Experimental Workshop, Sony Vaio VGN-AW11Z/B Battery

5th Exhibition, which employed an ‘auto-slide’, a machine developed by Sony that made it possible to synchronize a slide show with a soundtrack recorded on tape; they used the same device to produce the concert’s tape music at the Sony studio. Sony Vaio VGN-AW11XU/Q Battery  The concert, along with the experimental electroacoustic tape music they produced, anticipated the introduction of musique concrète in Japan later that year.[41] Beyond the Jikken Kobo, several other composers such as Yasushi Akutagawa, Saburo Tominaga and Shiro Fukai were also experimenting with producing radiophonic tape music between 1952 and 1953.[38]

 

Sony VAIO VGN-NW20SF Battery

Japan was introduced to musique concrète through Toshiro Mayuzumi, who in 1952 attended a Schaeffer concert in Paris.[40] On his return to Japan, he experimented with a short tape music piece for the 1952 comedy film Carmen Jyunjyosu (Carmen With Pure Heart)[42]

 

Sony VAIO VGN-NW20ZF Battery and then produced “X, Y, Z for Musique Concrète” which was broadcast by the JOQR radio station in 1953.[40] Mayuzumi also composed another musique concrète piece for Yukio Mishima’s 1954 radio drama Boxing.[42] Sony VAIO VGN-SR11M Battery

Schaeffer’s French concept of objet sonore (sound object), however, was not influential among Japanese composers, whose main interest in music technology was instead to, according to Mayuzumi, overcome the restrictions of “the materials or the boundary of human performance.”[43] Sony VAIO VGN-SR11MR Battery

This led to several Japanese electroacoustic musicians making use of serialism and twelve-tone techniques,[43] evident in Yoshiro Irino’s 1951 dodecaphonic piece “Concerto da Camera”,[42] in the organization of electronic sounds in Mayuzumi’s “X, Y, Z for Musique Concrète”, and later in Shibata’s electronic music by 1956.[44] Sony VAIO VGN-SR19VN Battery

 

Following the lead of the Cologne studio established in 1953, Japan’s NHK company established one of the world’s leading electronic music facilities in Tokyo, the NHK Studio, in 1954, equipping it with technologies such as tone-generating and audio processing equipment, recording and radiophonic equipment, Ondes Martenot, Sony VAIO VGN-SR19XN Battery

Monochord and Melochord, sine wave oscillators, tape recorders, ring modulators, band-pass filters, and four & eight channel mixers. Musicians associated with the studio included Toshiro Mayuzumi, Minao Shibata, Joji Yuasa, Sony VAIO VGN-SR21M/S Battery

Toshi Ichiyanagi, and Toru Takemitsu. The studio’s first electronic compositions were complete in 1955, including Mayuzumi’s 5-minute pieces “Studie I: Music for Sine Wave by Proportion of Prime Number”,Sony VAIO VGN-SR21RM/H Battery

“Music for Modulated Wave by Proportion of Prime Number” and “Invention for Square Wave and Sawtooth Wave” produced using the studio’s various tone-generating capabilities, and Shibata’s 20-minute stereo piece “Musique Concrète for Stereophonic Broadcast”.[45] Sony VAIO VGN-SR21M/S Battery

 

Ikutaro Kakehashi founded a repair shop called Kakehashi Watch Shop in the late 1940s repairing watches and radios, and then in 1954 founded Kakehashi Musen (“Kakehashi Radio”), which eventually grew into the company Ace Tone by 1960 and later the Roland Corporation by 1972.

 

Sony VAIO VGN-NW26M Battery Kakehashi began producing electronic musical instruments since 1955, with the aim of creating ones capable of producing monophonic melodies. During the late 1950s, he produced theramins, Ondes Martenots, and electronic keyboards, and by 1959, a Hawaiian guitar amplifier and electronic organs.[46][neutrality is disputed] Sony VAIO VGN-SR29VN Battery

 

[edit]American electronic music

In the United States, sounds were being created electronically and used in composition, as exemplified in a piece by Morton Feldman called Marginal Intersection. This piece is scored for winds, brass, percussion, strings, 2 oscillators, and sound effects of riveting, and the score uses Feldman’s graph notation. Sony VAIO VGN-SR31M Battery

 

The Music for Magnetic Tape Project was formed by members of the New York School (John Cage, Earle Brown, Christian Wolff, David Tudor, and Morton Feldman),[47] and lasted three years until 1954. Cage wrote of this collaboration: “In this social darkness, therefore, Sony VAIO VGN-SR41M/P Battery

the work of Earle Brown, Morton Feldman, and Christian Wolff continues to present a brilliant light, for the reason that at the several points of notation, performance, and audition, action is provocative.[48] Sony VAIO VGN-SR41M/S Battery

Cage completed Williams Mix in 1953 while working with the Music for Magnetic Tape Project.[49] The group had no permanent facility, and had to rely on borrowed time in commercial sound studios, including the studio of Louis and Bebe Barron. Sony VAIO VGN-SR51MF/P Battery

[edit]Columbia-Princeton Center

Further information: Columbia-Princeton Electronic Music Center

See also: Vladimir Ussachevsky and RCA Mark II Sound Synthesizer

In the same year Columbia University purchased its first tape recorder—a professional Ampex machine—for the purpose of recording concerts. Vladimir Ussachevsky, who was on the music faculty of Columbia University, was placed in charge of the device, and almost immediately began experimenting with it. Sony VAIO VGN-SR51MF/W Battery

Herbert Russcol writes: “Soon he was intrigued with the new sonorities he could achieve by recording musical instruments and then superimposing them on one another.”[50] Ussachevsky said later: “I suddenly realized that the tape recorder could be treated as an instrument of sound transformation.”[50] On Thursday, May 8, 1952, Sony VAIO VGN-SR51MR Battery

Ussachevsky presented several demonstrations of tape music/effects that he created at his Composers Forum, in the McMillin Theatre at Columbia University. These included Transposition, Reverberation, Experiment, Composition, and Underwater Valse. In an interview, he stated: “I presented a few examples of my discovery in a public concert in New York together with other compositions I had written for conventional instruments.”[50] Sony VGP-BPS13/B Battery

Otto Luening, who had attended this concert, remarked: “The equipment at his disposal consisted of an Ampex tape recorder . . . and a simple box-like device designed by the brilliant young engineer, Peter Mauzey, to create feedback, a form of mechanical reverberation. Other equipment was borrowed or purchased with personal funds.”[51] Sony VGP-BPS13B/B Battery

 

 

Just three months later, in August 1952, Ussachevsky traveled to Bennington, Vermont at Luening’s invitation to present his experiments. There, the two collaborated on various pieces. Luening described the event: “Equipped with earphones and a flute, I began developing my first tape-recorder composition. Sony VGP-BPS13A/B Battery

Both of us were fluent improvisors and the medium fired our imaginations.”[51] They played some early pieces informally at a party, where “a number of composers almost solemnly congratulated us saying, ‘This is it’ (‘it’ meaning the music of the future).”[51] Sony VGP-BPS13/S Battery

 

Word quickly reached New York City. Oliver Daniel telephoned and invited the pair to “produce a group of short compositions for the October concert sponsored by the American Composers Alliance and Broadcast Music, Inc., under the direction of Leopold Stokowski at the Museum of Modern Art in New York. After some hesitation, we agreed. . Sony VGP-BPS13 Batterty

 

 

. . Henry Cowell placed his home and studio in Woodstock, New York, at our disposal. With the borrowed equipment in the back of Ussachevsky’s car, we left Bennington for Woodstock and stayed two weeks. . . . In late September, 1952, the travelling laboratory reached Ussachevsky’s living room in New York, where we eventually completed the compositions.”[51] Sony VGP-BPS13/Q Battery

 

Two months later, on October 28, Vladimir Ussachevsky and Otto Luening presented the first Tape Music concert in the United States. The concert included Luening’s Fantasy in Space (1952)—”an impressionistic virtuoso piece”[51] using manipulated recordings of flute—and Low Speed (1952), Sony VGP-BPS13A/Q Battery

an “exotic composition that took the flute far below its natural range.”[51] Both pieces were created at the home of Henry Cowell in Woodstock, NY. After several concerts caused a sensation in New York City, Ussachevsky and Luening were invited onto a live broadcast of NBC’s Today Show to do an interview demonstration—the first televised electroacoustic performance. Luening described the event: Sony VGP-BPS13B/Q Battery

“I improvised some [flute] sequences for the tape recorder. Ussachevsky then and there put them through electronic transformations.”[52] Sony VGP-BPS21 Battery

 

1954 saw the advent of what would now be considered authentic electric plus acoustic compositions—acoustic instrumentation augmented/accompanied by recordings of manipulated and/or electronically generated sound. Three major works were premiered that year: Varèse’s Déserts, for chamber ensemble and tape sounds, Sony VGP-BPS21A Battery

and two works by Luening and Ussachevsky: Rhapsodic Variations for the Louisville Symphony and A Poem in Cycles and Bells, both for orchestra and tape. Because he had been working at Schaeffer’s studio, the tape part for Varèse’s work contains much more concrete sounds than electronic. Sony VGP-BPS21B Battery

“A group made up of wind instruments, percussion and piano alternates with the mutated sounds of factory noises and ship sirens and motors, coming from two loudspeakers.”[53]

Déserts was premiered in Paris in the first stereo broadcast on French Radio.[citation needed] At the German premiere in Hamburg, which was conducted by Bruno Maderna, the tape controls were operated by Karlheinz Stockhausen.[53] Sony VGP-BPS21A/B Battery

The title Déserts, suggested to Varèse not only, “all physical deserts (of sand, sea, snow, of outer space, of empty streets), but also the deserts in the mind of man; not only those stripped aspects of nature that suggest bareness, aloofness, timelessness, but also that remote inner space no telescope can reach, where man is alone, a world of mystery and essential loneliness.”[54] Sony VGP-BPS21/S Battery

 

In 1958, Columbia-Princeton developed the RCA Mark II Sound Synthesizer, the first programmable synthesizer.[55] Prominent composers such as Vladimir Ussachevsky, Otto Luening, Milton Babbitt, Charles Wuorinen, Sony VAIO VGN-NW20EF Battery

  • Sony VAIO VGN-NW24S Battery  Halim El-Dabh, Bülent Arel and Mario Davidovsky used the RCA Synthesizer extensively in various compositions.[56] One of the most influential composers associated with the early years of the studio was Egypt’s Halim El-Dabh who,[57] after having developed the earliest known electronic tape music in 1944,[25] Sony VPCY115FG/S Battery
  •   became more famous for Leiyla and the Poet, a 1959 series of electronic compositions which stood out for its immersion and seamless fusion of electronic and folk music, in contrast to the more mathematical approach used by serial composers such as Babbitt at the time. Sony VPCY115FGS Battery
  • El-Dabh’s Leiyla and the Poet, released as part of the album Columbia-Princeton Electronic Music Center in 1961, would be cited as a strong influence by a number of musicians, ranging from Neil Rolnick, Charles Amirkhanian and Alice Shields to rock musicians Frank Zappa and The West Coast Pop Art Experimental Band.[58] Sony VPCY115FX/B Battery

 

[edit]Stochastic music

Main articles: Iannis Xenakis and Stochastic music

  • An important new development was the advent of computers for the purpose of composing music, as opposed to manipulating or creating sounds. Iannis Xenakis began what is called “musique stochastique,” or “stochastic music”,Sony VPCY118GX/BI Battery
  • Sony VPCY21AVJ Battery  which is a method of composing that employs mathematical probability systems.[citation needed] Different probability algorithms were used to create a piece under a set of parameters. Xenakis used graph paper and a ruler to aid in calculating the velocity trajectories of glissandi for his orchestral composition Metastasis (1953–54), Sony VPCY119FJ Battery

Sony VPCY21AHJ Battery but later turned to the use of computers to compose pieces like ST/4 for string quartet and ST/48 for orchestra (both 1962).[citation needed]

[edit]Mid-to-late 1950s

  • In 1954, Stockhausen composed his Elektronische Studie II—the first electronic piece to be published as a score. In 1955, more experimental and electronic studios began to appear. Notable were the creation of the Studio de Fonologia (already mentioned), Sony VPCY11AFJ Battery

a studio at the NHK in Tokyo founded by Toshiro Mayuzumi, and the Phillips studio at Eindhoven, the Netherlands, which moved to the University of Utrecht as the Institute of Sonology in 1960.

  • The score for Forbidden Planet, by Louis and Bebe Barron,[59] was entirely composed using custom built electronic circuits and tape recorders in 1956. Sony VPCY11AGJ Battery

 

  • The world’s first computer to play music was CSIRAC which was designed and built by Trevor Pearcey and Maston Beard. Mathematician Geoff Hill programmed the CSIRAC to play popular musical melodies from the very early 1950s. In 1951 it publicly played the Colonel Bogey March of which no known recordings exist.[60] However, Sony VPCY11AHJ Battery
  • CSIRAC played standard repertoire and was not used to extend musical thinking or composition practice which is current computer music practice. CSIRAC was never recorded, but the music played was accurately reconstructed (reference 12). Sony VPCY11AVJ Battery
  • The oldest known recordings of computer generated music were played by the Ferranti Mark 1 computer, a commercial version of the Baby Machine from the University of Manchester in the autumn of 1951. The music program was written by Christopher Strachey. Sony VPCY11M1E Battery

 

  • The impact of computers continued in 1956. Lejaren Hiller and Leonard Isaacson composed Iliac Suite for string quartet, the first complete work of computer-assisted composition using algorithmic composition. “…Sony VPCY11S1E Battery
  •   Hiller postulated that a computer could be taught the rules of a particular style and then called on to compose accordingly.”[61] Later developments included the work of Max Mathews at Bell Laboratories, who developed the influential MUSIC I program. Sony VPCY11V9E Battery
  • In 1957, MUSIC, one of the first computer programs to play electronic music, was created by Max Mathews at Bell Laboratories. Vocoder technology was also a major development in this early era. In 1956, Stockhausen composed Gesang der Jünglinge, Sony VPCY11V9E/S Battery
  • the first major work of the Cologne studio, based on a text from the Book of Daniel. An important technological development of that year was the invention of the Clavivox synthesizer by Raymond Scott with subassembly by Robert Moog. Sony VPCY219FJ/S Battery

 

  • Also in 1957, Kid Baltan (Dick Raaymakers) and Tom Dissevelt released their debut album, Song Of The Second Moon, recorded at the Phillips studio.[62] The public remained interested in the new sounds being created around the world, as can be deduced by the inclusion of Varèse’s Poème électronique, Sony VPCY21AFJ Battery
  • which was played over four hundred loudspeakers at the Phillips Pavilion of the 1958 Brussels World Fair. That same year, Mauricio Kagel, an Argentine composer, composed Transición II. The work was realized at the WDR studio in Cologne. Sony VPCY21AGJ BatteryTwo musicians perform on a piano, one in the traditional manner, the other playing on the strings, frame, and case. Two other performers use tape to unite the presentation of live sounds with the future of prerecorded materials from later on and its past of recordings made earlier in the performance. Dell Latitude E5420 Battery

 

[edit]Expansion: 1960s

 

See also: Synthesizer, Harald Bode, Modular synthesizer, Buchla, and Moog Music

  • These were fertile years for electronic music—not just for academia, but for independent artists as synthesizer technology became more accessible. By this time, a strong community of composers and musicians working with new sounds and instruments was established and growing. Dell Latitude E5520 Battery
  • DELL Latitude E5510 Battery 1960 witnessed the composition of Luening’s Gargoyles for violin and tape as well as the premiere of Stockhausen’s Kontakte for electronic sounds, piano, and percussion. This piece existed in two versions—one for 4-channel tape, and the other for tape with human performers. Dell Latitude E6120 Battery
  •   ”In Kontakte, Stockhausen abandoned traditional musical form based on linear development and dramatic climax. This new approach, which he termed ‘moment form,’ resembles the ‘cinematic splice’ techniques in early twentieth century film.”[63] Dell Latitude E6220 Battery

 

The first of these synthesizers to appear was the Buchla. Appearing in 1963, it was the product of an effort spearheaded by musique concrète composer Morton Subotnick.[citation needed]

  • The theremin had been in use since the 1920s but it attained a degree of popular recognition through its use in science-fiction film soundtrack music in the 1950s (e.g., Dell Latitude E6320 Battery

DELL Latitude E5410 Battery  Bernard Herrmann’s classic score for The Day the Earth Stood Still).[64]

  • In the UK in this period, the BBC Radiophonic Workshop (established in 1958) emerged one of the most productive and widely known electronic music studios in the world,[citation needed] thanks in large measure to their work on the BBC science-fiction series Doctor Who. Dell Latitude E6420 Battery
  • One of the most influential British electronic artists in this period[65] was Workshop staffer Delia Derbyshire, who is now famous for her 1963 electronic realisation of the iconic Doctor Who theme, composed by Ron Grainer. Dell Latitude E6420 ATG Battery

 

 

 

Israeli composer Josef Tal at the Electronic Music Studio in Jerusalem (~1965). On the right, Hugh Le Caine’s sound synthesizer the Special Purpose Tape Recorder.

  • In 1961 Josef Tal established the Centre for Electronic Music in Israel at The Hebrew University, and in 1962 Hugh Le Caine arrived in Jerusalem to install his Creative Tape Recorder in the centre.[66] In the 1990s Tal conducted, together with Dr Shlomo Markel, Dell Latitude E6520 Battery
  • in cooperation with the Technion – Israel Institute of Technology, and VolkswagenStiftung a research project (Talmark) aimed at the development of a novel musical notation system for electronic music.[67] Dell Latitude E6500 Battery

 

  • Milton Babbitt composed his first electronic work using the synthesizer—his Composition for Synthesizer (1961)—which he created using the RCA synthesizer at the Columbia-Princeton Electronic Music Center. Dell Latitude E6400 Battery

 

  • For Babbitt, the RCA synthesizer was a dream come true for three reasons. First, the ability to pinpoint and control every musical element precisely. Second, the time needed to realize his elaborate serial structures were brought within practical reach. Third, the question was no longer “What are the limits of the human performer?” but rather “What are the limits of human hearing?[68] DELL Latitude E6400 ATG

 

  • The collaborations also occurred across oceans and continents. In 1961, Ussachevsky invited Varèse to the Columbia-Princeton Studio (CPEMC). Upon arrival, Varese embarked upon a revision of Déserts. He was assisted by Mario Davidovsky and Bülent Arel.[69]
  • ·

Dell Latitude E5400 Battery

  • The intense activity occurring at CPEMC and elsewhere inspired the establishment of the San Francisco Tape Music Center in 1963 by Morton Subotnick, with additional members Pauline Oliveros, Ramon Sender, Anthony Martin, and Terry Riley. Riley’s overdubbed recording A Rainbow in Curved Air (1967) employed various electronic keyboard instruments, all played by the composer-improviser.[citation needed] DELL Latitude E6400 XFR

 

Later, the Center moved to Mills College, directed by Pauline Oliveros, where it is today known as the Center for Contemporary Music.[70]

  • Simultaneously in San Francisco, composer Stan Shaff and equipment designer Doug McEachern, presented the first “Audium” concert at San Francisco State College (1962), followed by a work at the San Francisco Museum of Modern Art (1963), DELL Latitude E6410 Battery
  • conceived of as in time, controlled movement of sound in space. Twelve speakers surrounded the audience, four speakers were mounted on a rotating, mobile-like construction above.[71] In an SFMOMA performance the following year (1964), DELL Latitude E6410 ATG
  • San Francisco Chronicle music critic Alfred Frankenstein commented, “the possibilities of the space-sound continuum have seldom been so extensively explored”.[71] In 1967, the first Audium, a “sound-space continuum” opened, holding weekly performances through 1970. In 1975, enabled by seed money from the National Endowment for the Arts, DELL Latitude E6510 Battery
  • a new Audium opened, designed floor to ceiling for spatial sound composition and performance.[72] “There are composers who manipulate sound space by locating multiple speakers at various locations in a performance space and then switching or panning the sound between the sources. In this approach, DELL Precision M2400 Battery
  • the composition of spatial manipulation is dependent on the location of the speakers and usually exploits the acoustical properties of the enclosure. Examples include Varese’s Poem Electronique (tape music performed in the Phillips Pavilion of the 1958 World Fair, Brussels) and Stanley Schaff’s Audium installation, currently active in San Francisco.”[7DELL Precision M4400 Battery

3] Through weekly programs (over 4,500 in 40 years), Shaff “sculpts” sound, performing now-digitized spatial works live through 176 speakers.[74]

  • A well-known example of the use of Moog’s full-sized Moog modular synthesizer is the Switched-On Bach album by Wendy Carlos, which triggered a craze for synthesizer music. DELL Precision M4500 Battery

 

  • Pietro Grossi was an Italian pioneer of computer composition and tape music, who first experimented with electronic techniques in the early sixties. Grossi was a cellist and composer, born in Venice in 1917. He founded the S 2F M (Studio de Fonologia Musicale di Firenze) in 1963 in order to experiment with electronic sound and composition. DELL Precision M6400 Battery

 

[edit]Computer music

Main article: Computer music

See also: Music-N and Algorithmic composition

  • CSIRAC, the first computer to play music, did so publicly in August 1951 (reference 12).[75] One of the first large-scale public demonstrations of computer music was a pre-recorded national radio broadcast on the NBC radio network program Monitor on February 10, DELL Precision M6500 Battery

1962. In 1961, LaFarr Stuart programmed Iowa State University’s CYCLONE computer (a derivative of the Illiac) to play simple, recognizable tunes through an amplified speaker that had been attached to the system originally for administrative and diagnostic purposes. An interview with Mr. Stuart accompanied his computer music. Dell Latitude E5500 Battery

  • The late 1950s, 1960s and 1970s also saw the development of large mainframe computer synthesis. Starting in 1957, Max Mathews of Bell Labs developed the MUSIC programs, culminating in MUSIC V, a direct digital synthesis language[76] Dell Studio 1735 Battery

 

[edit]Live electronics

Main article: Live electronic music

  • In America, live electronics were pioneered in the early 1960s by members of Milton Cohen’s Space Theater in Ann Arbor, Michigan, including Gordon Mumma and Robert Ashley, by individuals such as David Tudor around 1965, Dell Studio 1737 Battery
  • Dell Studio 1558 Battery  and The Sonic Arts Union, founded in 1966 by Gordon Mumma, Robert Ashley, Alvin Lucier, and David Behrman. ONCE Festivals, featuring multimedia theater music, were organized by Robert Ashley and Gordon Mumma in Ann Arbor between 1958 and 1969. In 1960, John Cage composed Cartridge Music, one of the earliest live-electronic works.[citation needed] Dell Inspiron 1737 Battery

 

  • In Europe in 1964, Karlheinz Stockhausen composed Mikrophonie I for tam-tam, hand-held microphones, filters, and potentiometers, and Mixtur for orchestra, four sine-wave generators, and four ring modulators. In 1965 he composed Mikrophonie II for choir, Hammond organ, and ring modulators.[77] Dell Studio 1535 Battery

 

  • The Jazz composers and musicians Paul Bley and Annette Peacock performed some of the first live concerts in the late 1960s using Moog synthesizers. Peacock made regular use of a customised Moog synthesizer to process her voice on stage and in studio recordings.[citation needed]

Dell Studio 1557 Battery

  • In 1966–67, Reed Ghazala discovered and began to teach “circuit bending”—the application of the creative short circuit, a process of chance short-circuiting, creating experimental electronic instruments, exploring sonic elements mainly of timbre and with less regard to pitch or rhythm, and influenced by John Cage’s aleatoric music [sic] concept.[78] Dell Studio 1536 Battery

 

[edit]Popularization: 1970s to early 1980s

 

[edit]Synthesizers

See also: Modular synthesizer, Buchla, Electronic Music Studios, and Korg

  • Released in 1970 by Moog Music the Mini-Moog was among the first widely available, portable and relatively affordable synthesizers. It became the most widely used synthesizer in both popular and electronic art music.[79] Patrick Gleeson, Dell Studio 1537 Battery
  • Dell Studio 1555 Battery playing live with Herbie Hancock in the beginning of the 1970s, pioneered the use of synthesizers in a touring context, where they were subject to stresses the early machines were not designed for.[80][81] Sony VGP-BPS12 Battery

 

  • In 1974 the WDR studio in Cologne acquired an EMS Synthi 100 synthesizer which was used by a number of composers in the production of notable electronic works—amongst others, Rolf Gehlhaar’s Fünf deutsche Tänze (1975), Karlheinz Stockhausen’s Sirius (1975–76), and John McGuire’s Pulse Music III (1978).[82] Sony VGP-BPL12 Battery

 

  • The early 1980s saw the rise of bass synthesizers, the most influential being the Roland TB-303, a bass synthesizer and sequencer released in late 1981 that would later become synonymous with electronic dance music,[83] particularly acid house.[84Sony VGP-BPS12/Q Battery
  • ] One of the first to utilize it was Charanjit Singh in 1982, though it wouldn’t be popularized until Phuture’s “Acid Tracks” in 1987.[84] Sony VGP-BPS13 Battery

 

[edit]IRCAM, STEIM, and Elektronmusikstudion

Main article: IRCAM

  • IRCAM in Paris became a major center for computer music research and realization and development of the Sogitec 4X computer system,[85] featuring then revolutionary real-time digital signal processing. Pierre Boulez’s Répons (1981) for 24 musicians and 6 soloists used the 4X to transform and route soloists to a loudspeaker system. Sony VGP-BPS13A/B Battery

 

Main article: STEIM

  • STEIM is a center for research and development of new musical instruments in the electronic performing arts, located in Amsterdam, Netherlands. STEIM has existed since 1969. It was founded by Misha Mengelberg, Louis Andriessen, Peter Schat, Dick Raaymakers, Jan van Vlijmen, Reinbert de Leeuw, and Konrad Boehmer. Sony VGP-BPS13A/S Battery
  • This group of Dutch composers had fought for the reformation of Amsterdam’s feudal music structures; they insisted on Bruno Maderna’s appointment as musical director of the Concertgebouw Orchestra and enforced the first public fundings for experimental and improvised electronic music in The Netherlands. Sony VGP-BPS13B/B Battery

 

Main article: Elektronmusikstudion

  • Elektronmusikstudion (EMS), formerly known as Electroacoustic Music in Sweden, is the Swedish national centre for electronic music and sound art. The research organisation started in 1964 and is based in Stockholm. Sony VGP-BPS13/S Battery

 

[edit]Rise of popular electronic music

Main articles: Electronic rock, Synthpop, Electro music, and House music

See also: Progressive rock, Berlin School of electronic music, Krautrock, and Space rock

Sony VGP-BPS13B Battery

 

Keith Emerson performing in St. Petersburg in 2008

  • In the late 1960s, pop and rock musicians, including The Beach Boys and The Beatles, began to use electronic instruments, like the theremin and Mellotron, to supplement and define their sound. By the end of the decade, the Moog synthesizer took a leading place in the sound of emerging progressive rock with bands including Pink Floyd, Sony VGP-BPS13B/Q Battery
  • Yes, Emerson, Lake & Palmer, and Genesis making them part of their sound. Instrumental prog rock was particularly significant in continental Europe, allowing bands like Kraftwerk, Tangerine Dream, Can, and Faust to circumvent the language barrier.[86] Sony VGP-BPS13/Q Battery
  •   Their synthesiser-heavy “Kraut rock”, along with the work of Brian Eno (for a time the keyboard player with Roxy Music), would be a major influence on subsequent synth rock.[87] Electronic rock was also produced by several Japanese musicians, including Isao Tomita’s Electric Samurai: Switched on Rock (1972), Sony VGP-BPS13/B Battery
  • which featured Moog synthesizer renditions of contemporary pop and rock songs,[88] and Osamu Kitajima’s progressive rock album Benzaiten (1974).[89] The mid-1970s saw the rise of electronic art music musicians such as Jean Michel Jarre, Vangelis, and Tomita, who with Brian Eno were a significant influence on the development of New Age Music.[90] Sony VGP-BPS13B/S Battery

After the arrival of punk rock, a form of basic synth rock emerged, increasingly using new digital technology to replace other instruments. Pioneering bands included Ultravox with their 1977 single “Hiroshima Mon Amour”,[91] Yellow Magic Orchestra from Japan, The Human League and Tubeway Army from the UK, and Devo from the US.[92] Sony VGP-BPS13A Battery

  •  Yellow Magic Orchestra in particular helped pioneer synthpop with their self-titled album (1978) and Solid State Survivor (1979).[93] The definition of MIDI and the development of digital audio made the development of purely electronic sounds much easier.[94] Sony VGP-BPS14/B Battery
  •  These developments led to the growth of synth pop, which after it was adopted by the New Romantic movement, allowed synthesizers to dominate the pop and rock music of the early 80s. Key acts included Duran Duran, Spandau Ballet, A Flock of Seagulls, Culture Club,
  • Sony VGP-BPS22A Battery

Sony VGP-BPS26 Battery Talk Talk, Japan and the Eurythmics. Synthpop sometimes used synthesizers to replace all other instruments,[95] until the style began to fall from popularity in the mid-1980s.[92]

[edit]Sequencers and drum machines

Main articles: Music sequencer and Drum machines

 

  • This article’s factual accuracy is disputed. Please help to ensure that disputed facts are reliably sourced. See the relevant discussion on the talk page. (December 2011) Sony VGP-BPS14B Battery

 

  • Music sequencers began being used around the mid 20th century, and Tomita’s albums in mid-1970s being later examples.[88] In 1978, Yellow Magic Orchestra were using computer-based technology in conjunction with a synthesiser to produce popular music,[96] Sony VGP-BPS14/S Battery

making their early use of the microprocessor-based Roland MC-8 Microcomposer sequencer.[97][98][not in citation given]

  • Drum machines, also known as rhythm machines, also began being used around the late-1950s, with a later example being Osamu Kitajima’s progressive rock album Benzaiten (1974), which used a rhythm machine along with electronic drums and a synthesizer.[89] Sony VGP-BPL14/B Battery
  • In 1977, Ultravox’s “Hiroshima Mon Amour” was one of the first singles to use the metronome-like percussion of a Roland TR-77 drum machine.[91] In 1980, Roland Corporation released the TR-808, one of the first and most popular programmable drum machines. The first band to use it was Yellow Magic Orchestra in 1980, Sony VGP-BPL14 Battery
  • and it would later gain widespread popularity with the release of Marvin Gaye’s “Sexual Healing” and Afrika Bambaataa’s “Planet Rock” in 1982, after which the TR-808 would remain in continued use until at least 2008.[99] Sony VGP-BPL14B Battery

 

[edit]Birth of MIDI

Main article: MIDI

  • In 1980, a group of musicians and music merchants met to standardize an interface by which new instruments could communicate control instructions with other instruments and the prevalent microcomputer. Sony VGP-BPL14/S Battery
  • This standard was dubbed MIDI (Musical Instrument Digital Interface) and resulted from a collaboration between leading manufacturers intially Sequential Circuits, Oberheim, Roland, and later participated groups including: Yamaha, Korg, and Kawai, etc.[100] Sony VGP-BPS14 Battery

A paper was authored by Dave Smith of Sequential Circuits and proposed to the Audio Engineering Society in 1981. Then, in August 1983, the MIDI Specification 1.0 was finalized.

  • The advent of MIDI technology allows a single keystroke, control wheel motion, pedal movement, or command from a microcomputer to activate every device in the studio remotely and in synchrony, Sony VGP-BPL15/B Battery

with each device responding according to conditions predetermined by the composer.

  • MIDI instruments and software made powerful control of sophisticated instruments easily affordable by many studios and individuals. Acoustic sounds became reintegrated into studios via sampling and sampled-ROM-based instruments. Sony VGP-BPS15/B Battery

 

  • Miller Puckette developed graphic signal-processing software for 4X called Max (after Max Mathews) and later ported it to Macintosh (with Dave Zicarelli extending it for Opcode)[101] for real-time MIDI control, bringing algorithmic composition availability to most composers with modest computer programming background. Sony VGP-BPL15/S Battery

 

[edit]Digital synthesis

See also: Digital synthesizer, Sampling (music), Additive synthesis#Implementations, Bell Labs Digital Synthesizer, and Synclavier

 

  • This article’s factual accuracy is disputed. Please help to ensure that disputed facts are reliably sourced. See the relevant discussion on the talk page. (December 2011). Sony VGP-BPS15/S Battery

 

  • In 1975, the Japanese company Yamaha licensed the algorithms for frequency modulation synthesis (FM synthesis) from John Chowning, who had experimented with it at Stanford University since 1971.[102][103] Yamaha’s engineers began adapting Chowning’s algorithm for use in a digital synthesizer, Sony VGP-BPS15 Battery
  • adding improvements such as the “key scaling” method to avoid the introduction of distortion that normally occurred in analog systems during frequency modulation.[104] However, the first commercial digital synthesizer to be released would be the Australian Fairlight company’s Fairlight CMI (Computer Musical Instrument) in 1979, Sony VGP-BPL15 Battery

as the first practical polyphonic digital synthesizer/sampler system.

  • In 1980, Yamaha eventually released the first FM digital synthesizer, the Yamaha GS-1, but at an expensive price.[105] In 1983, Yamaha introduced the first stand-alone digital synthesizer, the DX-7, Sony VGP-BPS21A Battery
  • which also used FM synthesis and would become one of the best-selling synthesizers of all time.[102] The DX-7 was known for its recognizable bright tonalities that was partly due to an overachieving sampling rate of 57 kHz.[106] Sony VGP-BPS21B Battery

 

Barry Vercoe describes one of his experiences with early computer sounds:

  • At IRCAM in Paris in 1982, flutist Larry Beauregard had connected his flute to DiGiugno’s 4X audio processor, enabling real-time pitch-following. Sony VGP-BPS21 Battery
  • Sony VGP-BPS22 Battery  On a Guggenheim at the time, I extended this concept to real-time score-following with automatic synchronized accompaniment, and over the next two years Larry and I gave numerous demonstrations of the computer as a chamber musician, playing Handel flute sonatas,
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  •  Boulez’s Sonatine for flute and piano and by 1984 my own Synapse II for flute and computer—the first piece ever composed expressly for such a setup. A major challenge was finding the right software constructs to support highly sensitive and responsive accompaniment. All of this was pre-MIDI, Dell Inspiron 14 Battery
  • but the results were impressive even though heavy doses of tempo rubato would continually surprise my Synthetic Performer. In 1985 we solved the tempo rubato problem by incorporating learning from rehearsals (each time you played this way the machine would get better). We were also now tracking violin, since our brilliant, Dell Inspiron 1464 Battery
  • young flautist had contracted a fatal cancer. Moreover, this version used a new standard called MIDI, and here I was ably assisted by former student Miller Puckette, whose initial concepts for this task he later expanded into a program called MAX.[107]
  • ·

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[edit]Late 1980s to 1990s

 

[edit]Rise of dance music

Main article: Electronic dance music

See also: Italo disco, Euro disco, Eurodance, Electro music, Techno, House music, Acid house, Rave music, and Trance music

  • In the late 1980s, dance music records made using only electronic instruments became increasingly popular. Dell Inspiron 15 Battery
  • The trend has continued to the present day with modern nightclubs worldwide regularly playing electronic dance music. Nowadays, electronic/dance music is so popular, that dedicated genre radio stations and TV Channels (e.g., NRJ Dance, MUSIC FORCE EUROPE) exist. Dell Inspiron 1564 Battery

[edit]Advancements

In the 1990s, interactive computer-assisted performance started to become possible, with one example described as:

  • Automated Harmonization of Melody in Real Time: An interactive computer system, developed in collaboration with flutist/composer Pedro Eustache, for realtime melodic analysis and harmonic accompaniment. Dell Inspiron 17 Battery

 

  • Based on a novel scheme of harmonization devised by Eustache, the software analyzes the tonal melodic function of incoming notes, and instantaneously performs an orchestrated harmonization of the melody. The software was originally designed for performance by Eustache on Yamaha WX7 wind controller, and was used in his composition Tetelestai, premiered in Irvine, California in March 1999.[108] Dell Inspiron 1764 Battery

 

  • Other recent developments included the Tod Machover (MIT and IRCAM) composition Begin Again Again for “hypercello”, an interactive system of sensors measuring physical movements of the cellist. Dell Inspiron Mini 12 Battery
  • Max Mathews developed the “Conductor” program for real-time tempo, dynamic and timbre control of a pre-input electronic score. Morton Subotnick released a multimedia CD-ROM All My Hummingbirds Have Alibis. Dell Inspiron 1210 Battery

 

[edit]2000s

 

 

 

Qlimax, a large electronic music event that occurs each year in the Netherlands, celebrating the Hardstyle subgenre of electronic music

  • In recent years, as computer technology has become more accessible and music software has advanced, interacting with music production technology is now possible using means that bear no relationship to traditional musical performance practices:[109] dell Studio XPS 16 battery
  • dell Studio 1745 battery for instance, laptop performance (laptronica)[110] and live coding.[111] In general, the term Live PA refers to any live performance of electronic music, whether with laptops, synthesizers, or other devices. dell Studio XPS 1640 battery

 

  • In the last decade, a number of software-based virtual studio environments have emerged, with products such as Propellerhead’s Reason and Ableton Live finding popular appeal.[112] Such tools provide viable and cost-effective alternatives to typical hardware-based production studios, and thanks to advances in microprocessor technology, dell Studio XPS 1645 battery
  • it is now possible to create high quality music using little more than a single laptop computer. Such advances have democratized music creation,[113] leading to a massive increase in the amount of home-produced electronic music available to the general public via the internet.

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  • Artists can now also individuate their production practice by creating personalized software synthesizers, effects modules, and various composition environments. Devices that once existed exclusively in the hardware domain can easily have virtual counterparts. dell Studio XPS 1647 battery
  • Some of the more popular software tools for achieving such ends are commercial releases such as Max/Msp and Reaktor and open source packages such as Csound, Pure Data, SuperCollider, and ChucK. Dell Inspiron 14z Battery

 

[edit]Circuit bending

Main article: circuit bending

See also: #Live electronics

  • Circuit bending is the creative customization of the circuits within electronic devices such as low voltage, battery-powered guitar effects, children’s toys and small digital synthesizers to create new musical or visual instruments and sound generators. Emphasizing spontaneity and randomness, Dell Inspiron 1470 Battery
  • the techniques of circuit bending have been commonly associated with noise music, though many more conventional contemporary musicians and musical groups have been known to experiment with “bent” instruments. Circuit bending usually involves dismantling the machine and adding components such as switches and potentiometers that alter the circuit. Dell Inspiron 1470n Battery
  •   With the revived interest for analogue synthesizer circuit bending became a cheap solution for many experimental musicians to create their own individual analogue sound generators. Dell Inspiron 15z Battery
  • Nowadays many schematics can be found to built noise generators such as the Atari Punk Console or the Dub Siren as well as simple modifications for children toys such as the famous Speak & Spells that are often modified by circuit benders. Dell Inspiron 1570 Battery

 

[edit]Chip music

 

 

Probing for “bends” using a jeweler’s screwdriver and alligator clips.

Main article: Chiptune

See also: Video game music

  • Chiptune, chipmusic, or chip music is music written in sound formats where many of the sound textures are synthesized or sequenced in real time by a computer or video game console sound chip, sometimes including sample-based synthesis and low bit sample playback. Many chip music devices featured synthesizers in tandem with low rate sample playback.[citation needed] Dell Inspiron 1570n Battery

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Financial crisis and The 2007–2012 global financial crisis

Financial crisis and The 2007–2012 global financial crisis

 

The term financial crisis is applied broadly to a variety of situations in which some financial institutions or assets suddenly lose a large part of their value[1]. In the 19th and early 20th centuries, many financial crises were associated with banking panics, Sony Vaio VGN-NR31E/S Battery

 

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and many recessions coincided with these panics. Other situations that are often called financial crises include stock market crashes and the bursting of other financial bubbles, currency crises, and sovereign defaults.[2][3] Financial crises directly result in a loss of paper wealth; they do not directly result in changes in the real economy unless a recession or depression follows.

 

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Many economists have offered theories about how financial crises develop and how they could be prevented. There is little consensus, however, and financial crises are still a regular occurrence around the world.

 

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When a bank suffers a sudden rush of withdrawals by depositors, this is called a bank run. Since banks lend out most of the cash they receive in deposits (see fractional-reserve banking), it is difficult for them to quickly pay back all deposits if these are suddenly demanded, so a run may leave the bank in bankruptcy,

 

Sony Vaio VGN-NR31SR/S Battery causing many depositors to lose their savings unless they are covered by deposit insurance. A situation in which bank runs are widespread is called a systemic banking crisis or just a banking panic. A situation without widespread bank runs, but in which banks are reluctant to lend,

 

Sony Vaio VGN-NR31S/S Batterybecause they worry that they have insufficient funds available, is often called a credit crunch. In this way, the banks become an accelerator of a financial crisis.[4]

 

Examples of bank runs include the run on the Bank of the United States in 1931 and the run on Northern Rock in 2007. The collapse of Bear Stearns in 2008 has also sometimes been called a bank run, even though Bear Stearns was an investment bank rather than a commercial bank.

 

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Banking crises generally occur after periods of risky lending and heightened loan defaults. [5] The U.S. savings and loan crisis of the 1980s led to a credit crunch which is seen as a major factor in the U.S. recession of 1990–91.

 

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Speculative bubbles and crashes

Main articles: Stock market crash and Bubble (economics)

Economists say that a financial asset (stock, for example) exhibits a bubble when its price exceeds the present value of the future income (such as interest or dividends) that would be received by owning it to maturity.[6] Sony Vaio VGN-NR31ER/S BatteryIf most market participants buy the asset primarily in hopes of selling it later at a higher price, instead of buying it for the income it will generate, this could be evidence that a bubble is present. If there is a bubble, Sony VAIO PCG-3F1L Battery

there is also a risk of a crash in asset prices: market participants will go on buying only as long as they expect others to buy, and when many decide to sell the price will fall. However, it is difficult to tell in practice whether an asset’s price actually equals its fundamental value, so it is hard to detect bubbles reliably. Some economists insist that bubbles never or almost never occur.[7] Sony VAIO PCG-3F2L Battery

 

 

 

Black Friday, 9 May 1873, Vienna Stock Exchange. The Panic of 1873 and Long Depression followed.

Well-known examples of bubbles (or purported bubbles) and crashes in stock prices and other asset prices include the Dutch tulip mania, the Wall Street Crash of 1929, the Japanese property bubble of the 1980s, the crash of the dot-com bubble in 2000–2001, and the now-deflating United States housing bubble.[5][8][9] Sony VAIO PCG-3F3L Battery

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International financial crises

Main articles: Currency crisis and Sovereign default

When a country that maintains a fixed exchange rate is suddenly forced to devalue its currency because of a speculative attack, this is called a currency crisis or balance of payments crisis. When a country fails to pay back its sovereign debt, Sony VAIO PCG-3J1L Battery

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this is called a sovereign default. While devaluation and default could both be voluntary decisions of the government, they are often perceived to be the involuntary results of a change in investor sentiment that leads to a sudden stop in capital inflows or a sudden increase in capital flight.

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Several currencies that formed part of the European Exchange Rate Mechanism suffered crises in 1992–93 and were forced to devalue or withdraw from the mechanism. Another round of currency crises took place in Asia in 1997–98. Many Latin American countries defaulted on their debt in the early 1980s. The 1998 Russian financial crisis resulted in a devaluation of the ruble and default on Russian government bonds.

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Wider economic crises

Main articles: Recession and Depression (economics)

Negative GDP growth lasting two or more quarters is called a recession. An especially prolonged recession may be called a depression, while a long period of slow but not necessarily negative growth is sometimes called economic stagnation. Sony VAIO PCG-5P2L Battery

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Since these phenomena affect much more than the financial system they are not usually considered financial crises as such though there are clearly links between the two.

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Declining consumer spendings.

Some economists argue that many recessions have been caused in large part by financial crises. One important example is the Great Depression, which was preceded in many countries by bank runs and stock market crashes. Sony VAIO PCG-5R1L Battery

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The subprime mortgage crisis and the bursting of other real estate bubbles around the world also led to recession in the U.S. and a number of other countries in late 2008 and 2009.

Some economists argue that financial crises are caused by recessions instead of the other way around, and that even where a financial crisis is the initial shock that sets off a recession, other factors may be more important in prolonging the recession. In particular, Sony VAIO PCG-5S1L Battery

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Milton Friedman and Anna Schwartz argued that the initial economic decline associated with the crash of 1929 and the bank panics of the 1930s would not have turned into a prolonged depression if it had not been reinforced by monetary policy mistakes on the part of the Federal Reserve[10], a position supported by Ben Bernanke.[11] Sony VAIO PCG-3H2L Battery

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Causes and consequences of financial crises

 

Strategic complementarities in financial markets

Main articles: Strategic complementarity and Self-fulfilling prophecy

It is often observed that successful investment requires each investor in a financial market to guess what other investors will do. George Soros has called this need to guess the intentions of others ‘reflexivity’.[12] Sony VAIO PCG-3H4L Battery

 

Similarly, John Maynard Keynes compared financial markets to a beauty contest game in which each participant tries to predict which model other participants will consider most beautiful.[13] Circularity and self-fulfilling prophecies may be exaggerated when reliable information is not available because of opaque disclosures or a lack of disclosure.[14] Sony VAIO PCG-3B1L Battery

 

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Furthermore, in many cases investors have incentives to coordinate their choices. For example, someone who thinks other investors want to buy lots of Japanese yen may expect the yen to rise in value, and therefore has an incentive to buy yen too. Likewise, a depositor in IndyMac Bank who expects other depositors to withdraw their funds may expect the bank to fail, Sony VAIO PCG-7153L Battery

 

Sony VAIO PCG-7151L Battery and therefore has an incentive to withdraw too. Economists call an incentive to mimic the strategies of others strategic complementarity.[15]

 

It has been argued that if people or firms have a sufficiently strong incentive to do the same thing they expect others to do, then self-fulfilling prophecies may occur.[16] For example, if investors expect the value of the yen to rise, this may cause its value to rise;

 

Sony VAIO PCG-7148L Battery if depositors expect a bank to fail this may cause it to fail.[17] Therefore, financial crises are sometimes viewed as a vicious circle in which investors shun some institution or asset because they expect others to do so.[18] Sony VAIO PCG-7154L Battery

 

 

Leverage

Main article: Leverage (finance)

Leverage, which means borrowing to finance investments, is frequently cited as a contributor to financial crises[14] . When a financial institution (or an individual) only invests its own money, it can, in the very worst case,

Sony VAIO PCG-7184L Battery lose its own money. But when it borrows in order to invest more, it can potentially earn more from its investment, but it can also lose more than all it has. Therefore leverage magnifies the potential returns from investment, but also creates a risk of bankruptcy.

 

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Since bankruptcy means that a firm fails to honor all its promised payments to other firms, it may spread financial troubles from one firm to another (see ‘Contagion’ below).

 

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The average degree of leverage in the economy often rises prior to a financial crisis[citation needed]. For example, borrowing to finance investment in the stock market (“margin buying”) became increasingly common prior to the Wall Street Crash of 1929. Sony VAIO PCG-7161L Battery

In addition, some scholars have argued that financial institutions can contribute to fragility by hiding leverage, and thereby contributing to underpricing of risk.[14]

 

Asset-liability mismatch

Main article: Asset-liability mismatch

Another factor believed to contribute to financial crises is asset-liability mismatch, a situation in which the risks associated with an institution’s debts and assets are not appropriately aligned. For example,

 

Sony VAIO PCG-7181L Battery commercial banks offer deposit accounts which can be withdrawn at any time and they use the proceeds to make long-term loans to businesses and homeowners. The mismatch between the banks’ short-term liabilities (its deposits) and its long-term assets (its loans) is seen as one of the reasons bank runs occur (when depositors panic and decide to withdraw their funds more quickly than the bank can get back the proceeds of its loans).[17]

 

Sony VAIO PCG-7173L BatteryLikewise, Bear Stearns failed in 2007–08 because it was unable to renew the short-term debt it used to finance long-term investments in mortgage securities.

 

In an international context, many emerging market governments are unable to sell bonds denominated in their own currencies,

Sony VAIO PCG-7171L Batteryand therefore sell bonds denominated in US dollars instead. This generates a mismatch between the currency denomination of their liabilities (their bonds) and their assets (their local tax revenues), so that they run a risk of sovereign default due to fluctuations in exchange rates.[19] Sony VAIO PCG-7162L Battery

 

 

Uncertainty and herd behavior

Main articles: Economic psychology and Herd behavior

Many analyses of financial crises emphasize the role of investment mistakes caused by lack of knowledge or the imperfections of human reasoning. Behavioral finance studies errors in economic and quantitative reasoning. Psychologist Torbjorn K A Eliazonhas also analyzed failures of economic reasoning in his concept of ‘œcopathy’.[20] Sony  VAIO VGN-FW21E Battery

 

Historians, notably Charles P. Kindleberger, have pointed out that crises often follow soon after major financial or technical innovations that present investors with new types of financial opportunities, which he called “displacements” of investors’ expectations.[21Sony  VAIO VGN-FW21I Battery

 

 

][22] Early examples include the South Sea Bubble and Mississippi Bubble of 1720, which occurred when the notion of investment in shares of company stock was itself new and unfamiliar,[23] and the Crash of 1929, which followed the introduction of new electrical and transportation technologies.[2Sony  VAIO VGN-FW21L Battery

4] More recently, many financial crises followed changes in the investment environment brought about by financial deregulation, and the crash of the dot com bubble in 2001 arguably began with “irrational exuberance” about Internet technology.[25]

 

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Unfamiliarity with recent technical and financial innovations may help explain how investors sometimes grossly overestimate asset values. Also, if the first investors in a new class of assets (for example, stock in “dot com” companies) profit from rising asset values as other investors learn about the innovation (in our example, Sony  VAIO VGN-FW21Z Battery

 

 

Sony VAIO VGN-FW51ZF/H Battery as others learn about the potential of the Internet), then still more others may follow their example, driving the price even higher as they rush to buy in hopes of similar profits. If such “herd behavior” causes prices to spiral up far above the true value of the assets, a crash may become inevitable.

Sony VAIO VGN-FW51MF/H BatteryIf for any reason the price briefly falls, so that investors realize that further gains are not assured, then the spiral may go into reverse, with price decreases causing a rush of sales, reinforcing the decrease in prices. Sony  VAIO VGN-FW21M Battery

 

 

 

 

Regulatory failures

Main articles: Financial regulation and Bank regulation

Governments have attempted to eliminate or mitigate financial crises by regulating the financial sector. One major goal of regulation is transparency:

 

Sony VAIO VGN-FW51 Battery making institutions’ financial situations publicly known by requiring regular reporting under standardized accounting procedures. Another goal of regulation is making sure institutions have sufficient assets to meet their contractual obligations, through reserve requirements, capital requirements, and other limits on leverage. Sony  VAIO VGN-FW31M Battery

 

 

Some financial crises have been blamed on insufficient regulation, and have led to changes in regulation in order to avoid a repeat. For example, the Managing Director of the International Monetary Fund,

 

Sony VAIO VGN-FW4ZTJ/H Dominique Strauss-Kahn, has blamed the financial crisis of 2008 on ‘regulatory failure to guard against excessive risk-taking in the financial system, especially in the US’.[26] Likewise, the New York Times singled out the deregulation of credit default swaps as a cause of the crisis.[27]

 

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However, excessive regulation has also been cited as a possible cause of financial crises. In particular, the Basel II Accord has been criticized for requiring banks to increase their capital when risks rise, which might cause them to decrease lending precisely when capital is scarce, potentially aggravating a financial crisis.[28] Sony  VAIO VGN-FW31J Battery

 

 

International regulatory convergence has been interpreted in terms of regulatory herding, deepening market herding (discussed above) and so increasing systemic risk.[29] From this perspective, maintaining diverse regulatory regimes would be a safeguard. Sony VAIO VGN-FW11ZRU Battery

Fraud

Main articles: Ponzi scheme and Securities fraud

Fraud has played a role in the collapse of some financial institutions, when companies have attracted depositors with misleading claims about their investment strategies, or have embezzled the resulting income.

 

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Examples include Charles Ponzi’s scam in early 20th century Boston, the collapse of the MMM investment fund in Russia in 1994, the scams that led to the Albanian Lottery Uprising of 1997, and the collapse of Madoff Investment Securities in 2008.

 

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Many rogue traders that have caused large losses at financial institutions have been accused of acting fraudulently in order to hide their trades. Fraud in mortgage financing has also been cited as one possible cause of the 2008 subprime mortgage crisis; government officials stated on September 23,

 

Sony VAIO VGN-FW21J Battery2008 that the FBI was looking into possible fraud by mortgage financing companies Fannie Mae and Freddie Mac, Lehman Brothers, and insurer American International Group.[30] Likewise it has been argued that many financial companies failed in the recent crisis because their managers failed to carry out their fiduciary duties.[31] Sony VAIO VGN-FW11ZU Battery

 

Contagion

Main articles: Financial contagion and Systemic risk

Contagion refers to the idea that financial crises may spread from one institution to another, as when a bank run spreads from a few banks to many others, or from one country to another, as when currency crises, sovereign defaults, Sony VAIO VGN-FW21ER Battery

or stock market crashes spread across countries. When the failure of one particular financial institution threatens the stability of many other institutions, this is called systemic risk.[32]

 

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One widely-cited example of contagion was the spread of the Thai crisis in 1997 to other countries like South Korea. However, economists often debate whether observing crises in many countries around the same time is truly caused by contagion from one market to another, or whether it is instead caused by similar underlying problems that would have affected each country individually even in the absence of international linkages.

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Recessionary effects

Some financial crises have little effect outside of the financial sector, like the Wall Street crash of 1987, but other crises are believed to have played a role in decreasing growth in the rest of the economy. There are many theories why a financial crisis could have a recessionary effect on the rest of the economy.

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These theoretical ideas include the ‘financial accelerator’, ‘flight to quality’ and ‘flight to liquidity’, and the Kiyotaki-Moore model. Some ‘third generation’ models of currency crises explore how currency crises and banking crises together can cause recessions.[33] SONY VGN-FW41E/H BATTERY

 

Theories of financial crises

 

Austrian theories

Main article: Austrian business cycle theory

Austrian School economists have had a business cycle theory ever since Ludwig Von Mises published a treatise on money and banking in 1912[34]. This theory goes back to debates of the Currency School and Banking School, Sony VAIO VGN-NW20EF Battery

and it concerns the effects of the practice of fractional-reserve banking on the economy. It also has traditions back to the School of Salamanca. Its essential claim is that the creation of money and credit without the savings of real resources sets the economy on an unsustainable course in which entrepreneurs undertake too many projects which cannot be successfully completed without those resources.

Sony VAIO VGN-FW54M BatteryThe subsequent losses result in a swift reduction in the value of financial assets. In the ensuing banking crisis “money substitutes” shrink (unless supported by government bailouts); uncertainty about the solvency of banks leads depositors to redeem substitutes for base money which shrinks the money supply.[35] Sony VAIO VGN-NW24S Battery

 

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Since, in modern times, and especially since the creation of central banks, the banking system is integral to public finance, this business cycle is usually accompanied by a government debt crisis.

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Marxist theories

Main article: Crisis (Marxian)

Recurrent major depressions in the world economy at the pace of 20 and 50 years (often referred to as the business cycle) have been the subject of studies since Jean Charles Léonard de Sismondi (1773–1842) provided the first theory of crisis in a critique of classical political economy’s assumption of equilibrium between supply and demand. Sony VAIO VGN-NW26M Battery

 

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Developing an economic crisis theory become the central recurring concept throughout Karl Marx’s mature work. Marx’s law of the tendency for the rate of profit to fall borrowed many features of the presentation of John Stuart Mill’s discussion Of the Tendency of Profits to a Minimum (Principles of Political Economy Book IV Chapter IV). Sony VAIO VGN-NW20ZF Battery

 

Sony VAIO VGN-FW54E Battery The theory is a corrollary of the Tendency towards the Centralization of Profits.

 

In a capitalist system, successfully-operating businesses return less money to their workers (in the form of wages) than the value of the goods produced by those workers (i.e. the amount of money the products are sold for). This profit first goes towards covering the initial investment in the business. In the long-run, however, when one considers the combined economic activity of all successfully-operating business,

 

Sony VAIO VGN-FW46Z Battery it is clear that less money (in the form of wages) is being returned to the mass of the population (the workers) than is available to them to buy all of these goods being produced. Furthermore, the expansion of businesses in the process of competing for markets leads to an abundance of goods and a general fall in their prices, further exacerbating the tendency for the rate of profit to fall.

 

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The viability of this theory depends upon two main factors: firstly, the degree to which profit is taxed by government and returned to the mass of people in the form of welfare, family benefits and health and education spending; and secondly, the proportion of the population who are workers rather than investors/business owners. Sony VAIO VGN-NW20SF Battery

 

Sony VAIO VGN-NW26JG Battery Given the extraordinary capital expenditure required to enter modern economic sectors like airline transport, the military industry, or chemical production, these sectors are extremely difficult for new businesses to enter and are being concentrated in fewer and fewer hands.

 

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Empirical and econometric research continue especially in the world systems theory and in the debate about Nikolai Kondratiev and the so-called 50-years Kondratiev waves. Major figures of world systems theory, like Andre Gunder Frank and Immanuel Wallerstein, consistently warned about the crash that the world economy is now facing[citation needed]. Sony VAIO VGN-NW21MF/P Battery

World systems scholars and Kondratiev cycle researchers always implied that Washington Consensus oriented economists never understood the dangers and perils, which leading industrial nations will be facing and are now facing at the end of the long economic cycle which began after the oil crisis of 1973.

 

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Minsky’s theory

Hyman Minsky has proposed a post-Keynesian explanation that is most applicable to a closed economy. He theorized that financial fragility is a typical feature of any capitalist economy. High fragility leads to a higher risk of a financial crisis. To facilitate his analysis, Minsky defines three approaches to financing firms may choose, according to their tolerance of risk. They are hedge finance, speculative finance, and Ponzi finance. Ponzi finance leads to the most fragility. Sony VAIO VGN-NW20EF/P Battery

 

 

for hedge finance, income flows are expected to meet financial obligations in every period, including both the principal and the interest on loans.

for speculative finance, a firm must roll over debt because income flows are expected to only cover interest costs. None of the principal is paid off.

 

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for Ponzi finance, expected income flows will not even cover interest cost, so the firm must borrow more or sell off assets simply to service its debt. The hope is that either the market value of assets or income will rise enough to pay off interest and principal.

 

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Financial fragility levels move together with the business cycle. After a recession, firms have lost much financing and choose only hedge, the safest. As the economy grows and expected profits rise, firms tend to believe that they can allow themselves to take on speculative financing. In this case,

 

Sony VAIO VGN-NW24EG Battery they know that profits will not cover all the interest all the time. Firms, however, believe that profits will rise and the loans will eventually be repaid without much trouble. More loans lead to more investment, and the economy grows further. Sony VAIO VGN-NW20EF/w Battery

Then lenders also start believing that they will get back all the money they lend. Therefore, they are ready to lend to firms without full guarantees of success.

 

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Lenders know that such firms will have problems repaying. Still, they believe these firms will refinance from elsewhere as their expected profits rise. This is Ponzi financing. In this way, the economy has taken on much risky credit. Now it is only a question of time before some big firm actually defaults.

 

Sony VAIO VGN-FW56E BatteryLenders understand the actual risks in the economy and stop giving credit so easily. Refinancing becomes impossible for many, and more firms default. If no new money comes into the economy to allow the refinancing process, a real economic crisis begins. During the recession, firms start to hedge again, and the cycle is closed. Sony VAIO VGN-NW20EF/S Battery

Coordination games

Main article: Coordination game

Mathematical approaches to modeling financial crises have emphasized that there is often positive feedback[36] between market participants’ decisions (see strategic complementarity).[37] Positive feedback implies that there may be dramatic changes in asset values in response to small changes in economic fundamentals.

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For example, some models of currency crises (including that of Paul Krugman) imply that a fixed exchange rate may be stable for a long period of time, but will collapse suddenly in an avalanche of currency sales in response to a sufficient deterioration of government finances or underlying economic conditions.[38][39] Sony VAIO VGN-NW31EF Battery

 

 

According to some theories, positive feedback implies that the economy can have more than one equilibrium. There may be an equilibrium in which market participants invest heavily in asset markets because they expect assets to be valuable, but there may be another equilibrium where participants flee asset markets because they expect others to flee too.[4Sony VAIO VGN-NS10E/S Battery

0] This is the type of argument underlying Diamond and Dybvig’s model of bank runs, in which savers withdraw their assets from the bank because they expect others to withdraw too.[17] Likewise, in Obstfeld’s model of currency crises, when economic conditions are neither too bad nor too good, there are two possible outcomes: speculators may or may not decide to attack the currency depending on what they expect other speculators to do.[1Sony VAIO VGN-NS10J/S Battery

8]

 

Herding models and learning models

Main articles: Herd behavior and Adaptive expectations

A variety of models have been developed in which asset values may spiral excessively up or down as investors learn from each other.

 

Sony VAIO VGN-NS11ZR/S Battery In these models, asset purchases by a few agents encourage others to buy too, not because the true value of the asset increases when many buy (which is called “strategic complementarity”), but because investors come to believe the true asset value is high when they observe others buying.

 

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In “herding” models, it is assumed that investors are fully rational, but only have partial information about the economy. In these models, when a few investors buy some type of asset, this reveals that they have some positive information about that asset,

Sony VAIO VGN-NS11SR/S Battery which increases the rational incentive of others to buy the asset too. Even though this is a fully rational decision, it may sometimes lead to mistakenly high asset values (implying, eventually, a crash) since the first investors may, by chance, have been mistaken.

 

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In “adaptive learning” or “adaptive expectations” models, investors are assumed to be imperfectly rational, basing their reasoning only on recent experience. In such models, if the price of a given asset rises for some period of time, investors may begin to believe that its price always rises, which increases their tendency to buy and thus drives the price up further.

Sony VAIO VGN-NS11L/S BatteryLikewise, observing a few price decreases may give rise to a downward price spiral, so in models of this type large fluctuations in asset prices may occur. Agent-based models of financial markets often assume investors act on the basis of adaptive learning or adaptive expectations.

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History

The 2007–2012 global financial crisis, also known as the Global Financial Crisis and 2008 financial crisis, is considered by many economists to be the worst financial crisis since the Great Depression of the 1930s.[1]

                                                                  

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It resulted in the threat of total collapse from large financial institutions, the bailout of banks by national governments, and downturns in stock markets around the world. In many areas, the housing market also suffered, resulting in evictions, foreclosures and prolonged unemployment. The crisis played a significant role in the failure of key businesses, declines in consumer wealth estimated in trillions of US dollars,

Sony VAIO VGN-NS11E/S Battery and a downturn in economic activity leading to the 2008–2012 global recession and contributing to the European sovereign-debt crisis.[2][3] The active phase of the crisis, which manifested as a liquidity crisis, can be dated from August 7, 2007 when BNP Paribas terminated withdrawals from three hedge funds citing “a complete evaporation of liquidity”.[4] Sony VAIO VGN-NS10L/S Battery

 

 

The bursting of the U.S. housing bubble, which peaked in 2006,[5] caused the values of securities tied to U.S. real estate pricing to plummet, damaging financial institutions globally.[6][7] The financial crisis was triggered by a complex interplay of the overvaluation of bundled sub-prime mortgages,

 

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questionable trading practices on behalf of both buyers and sellers, and a lack of adequate capital holdings from banks and insurance companies to back the financial commitments they were making.[8][9][

 

Sony VGP-BPS21A/B Battery0] Questions regarding bank solvency, declines in credit availability and damaged investor confidence had an impact on global stock markets, where securities suffered large losses during 2008 and early 2009. Economies worldwide slowed during this period, as credit tightened and international trade declined.[11Sony VAIO VGN-SR11M Battery

 

Sony VGP-BPS21B Battery1] Governments and central banks responded with unprecedented fiscal stimulus, monetary policy expansion and institutional bailouts. Although there have been aftershocks, the financial crisis itself ended sometime between late-2008 and mid-2009.[12][13][1

 

Sony VGP-BPS21A Battery4] In the U.S., Congress passed the American Recovery and Reinvestment Act of 2009. In the EU, the UK responded with austerity measures of spending cuts and tax increases without export growth and it has since slid into a double-dip recession.[15][16]

 

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Many causes for the financial crisis have been suggested, with varying weight assigned by experts.[17] The U.S. Senate’s Levin–Coburn Report asserted that the crisis was the result of “high risk, complex financial products; undisclosed conflicts of interest; the failure of regulators, the credit rating agencies,

 

Sony VGP-BPS13B/Q Batteryand the market itself to rein in the excesses of Wall Street.”[18] Two factors that have been frequently cited include the liberal use of the Gaussian copula function and the failure to track data provenance.[1

 

Sony VGP-BPS13A/Q Battery9] The 1999 repeal of the Glass–Steagall Act effectively removed the separation between investment banks and depository banks in the United States.[20] Critics argued that credit rating agencies and investors failed to accurately price the risk involved with mortgage-related financial products, and that governments did not adjust their regulatory practices to address 21st-century financial markets.[21] Sony VAIO VGN-SR11MR Battery

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In response to the financial crisis, both market-based and regulatory solutions have been implemented or are under consideration.[22] Paul Krugman, author of End This Depression Now! (2012), argues that while current solutions have stabilized the world economy, the world economy will not improve unless it receives further stimulus. Sony VAIO VGN-SR19VN Battery

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[23] Buchanan, Gjerstad, and Smith argue that fiscal and monetary policy are ineffective, failing to reignite residential investment and construction as they have in past contractions. The current type of contraction requires balance sheet repair via currency depreciation and export-driven growth.

 

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Fiscal stimulus extends a current account deficit and retards export growth.[16][24] If the world economy does not improve, many economists fear sovereign default is a real possibility in several European countries and even the United States.[25] Sony VAIO VGN-SR19XN Battery

 

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The immediate cause or trigger of the crisis was the bursting of the United States housing bubble which peaked in approximately 2005–2006.[26][27] Already-rising default rates on “subprime” and adjustable-rate mortgages (ARM) began to increase quickly thereafter. As banks began to give out more loans to potential home owners, housing prices began to rise.

 

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Steadily decreasing interest rates backed by the U.S Federal Reserve from 1982 onward and large inflows of foreign funds created easy credit conditions for a number of years prior to the crisis, fueling a housing construction boom and encouraging debt-financed consumption.[28] Sony VAIO VGN-SR21M/S Battery

The combination of easy credit and money inflow contributed to the United States housing bubble. Loans of various types (e.g., mortgage, credit card, and auto) were easy to obtain and consumers assumed an unprecedented debt load.[29][30]

 

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As part of the housing and credit booms, the number of financial agreements called mortgage-backed securities (MBS) and collateralized debt obligations (CDO), which derived their value from mortgage payments and housing prices, greatly increased.[7] Sony VAIO VGN-SR21RM/H Battery

Such financial innovation enabled institutions and investors around the world to invest in the U.S. housing market. As housing prices declined, major global financial institutions that had borrowed and invested heavily in subprime MBS reported significant losses.[31] Sony VAIO VGN-SR21M/S Battery

 

 

Falling prices also resulted in homes worth less than the mortgage loan, providing a financial incentive to enter foreclosure. The ongoing foreclosure epidemic that began in late 2006 in the U.S. continues to drain wealth from consumers and erodes the financial strength of banking institutions.

 

Sony VAIO VGN-SR51MR Battery Defaults and losses on other loan types also increased significantly as the crisis expanded from the housing market to other parts of the economy. Total losses are estimated in the trillions of U.S. dollars globally.[31]

 

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Share in GDP of U.S. financial sector since 1860[32]

While the housing and credit bubbles were building, a series of factors caused the financial system to both expand and become increasingly fragile, a process called financialization. U.S. Government policy from the 1970s onward has emphasized deregulation to encourage business,

 

Sony VAIO VGN-SR51MF/P Batterywhich resulted in less oversight of activities and less disclosure of information about new activities undertaken by banks and other evolving financial institutions. Thus, policymakers did not immediately recognize the increasingly important role played by financial institutions such as investment banks and hedge funds, Sony VAIO VGN-SR29VN Battery

also known as the shadow banking system. Some experts believe these institutions had become as important as commercial (depository) banks in providing credit to the U.S. economy, but they were not subject to the same regulations.[33]

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These institutions, as well as certain regulated banks, had also assumed significant debt burdens while providing the loans described above and did not have a financial cushion sufficient to absorb large loan defaults or MBS losses.[34] Sony VAIO VGN-SR41M/P Battery

These losses impacted the ability of financial institutions to lend, slowing economic activity. Concerns regarding the stability of key financial institutions drove central banks to provide funds to encourage lending and restore faith in the commercial paper markets, which are integral to funding business operations. Sony VAIO VGN-SR31M Battery

Governments also bailed out key financial institutions and implemented economic stimulus programs, assuming significant additional financial commitments.

 

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The U.S. Financial Crisis Inquiry Commission reported its findings in January 2011. It concluded that “the crisis was avoidable and was caused by: Widespread failures in financial regulation, including the Federal Reserve’s failure to stem the tide of toxic mortgages; Sony Vaio VGN-SR49VN/H Battery

Dramatic breakdowns in corporate governance including too many financial firms acting recklessly and taking on too much risk; An explosive mix of excessive borrowing and risk by households and Wall Street that put the financial system on a collision course with crisis; Sony Vaio VGN-FW56Z Battery

Key policy makers ill prepared for the crisis, lacking a full understanding of the financial system they oversaw; and systemic breaches in accountability and ethics at all levels.”[35][36]

 

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Subprime lending

Main article: Subprime mortgage crisis

Intense competition between mortgage lenders for revenue and market share, and the limited supply of creditworthy borrowers, caused mortgage lenders to relax underwriting standards and originate riskier mortgages to less creditworthy borrowers.[

 

Sony Vaio VGN-SR59XG/H Battery7] Prior to 2003, when the mortgage securitization market was dominated by regulated and relatively conservative Government Sponsored Enterprises, GSEs policed mortgage originators and maintained relatively high underwriting standards.

Sony Vaio VGN-SR59VG/H Battery However, as market power shifted from securitizers to originators and as intense competition from private securitizers undermined GSE power, mortgage standards declined and risky loans proliferated.[7] The worst loans were originated in 2004–2007, the years of the most intense competition between securitizers and the lowest market share for the GSEs.

 

 

 

U.S. subprime lending expanded dramatically 2004–2006

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As well as easy credit conditions, there is evidence that competitive pressures contributed to an increase in the amount of subprime lending during the years preceding the crisis. Major U.S. investment banks and government sponsored enterprises like Fannie Mae played an important role in the expansion of lending, with GSEs eventually relaxing their standards to try to catch up with the private banks.[37][38]

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Subprime mortgages remained below 10% of all mortgage originations until 2004, when they spiked to nearly 20% and remained there through the 2005–2006 peak of the United States housing bubble.[39] Sony Vaio VGN-SR57S Battery

 

 

Some long-time critics of government and the GSEs, like American Enterprise Institute fellow Peter J. Wallison,[40] claim that the roots of the crisis can be traced directly to risky lending by government sponsored entities Fannie Mae and Freddie Mac. Sony Vaio VGN-SR57V Battery

Although Wallison’s claims have received widespread attention in the media and by policy makers, the majority report of the Financial Crisis Inquiry Commission, several studies by Federal Reserve economists, and the work of independent scholars suggest that Wallison’s claims are not supported by data.[7]

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In fact, the GSEs loans performed far better than loans securitized by private investment banks, and GSE loans performed better than some loans originated by institutions that held loans in their own portfolios.[7] Sony VPCF1 Battery

Wallison has been widely criticized for attempting to politicize the investigation of the Financial Crisis Inquiry Commission, and his critics include fellow Republican Commissioners.[41] Morgenson and Rosner also highlight the role of the GSEs in non-prime lending.[42] Others agree[43][44] and disagree.[45][46] Sony VPCF2 Battery

 

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On September 30, 1999, The New York Times reported that the Clinton Administration pushed for more lending to low and moderate income borrowers, while the mortgage industry sought guarantees for sub-prime loans: Sony VPCF11C4E/B Battery

 

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Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

 

Sony VPCF21Z1E/BI BatteryIn addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers… In moving, even tentatively, into this new area of lending, Sony VPCF11C5E Battery

 

Sony VPCF13M1E/H Battery Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980s.[47] Sony VPCF11D4E Battery

 

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In the early and mid-2000s (decade), the Bush administration called numerous times[48] for investigation into the safety and soundness of the GSEs and their swelling portfolio of subprime mortgages.

 

Sony VPCF12S1E/B BatteryOn September 10, 2003 the House Financial Services Committee held a hearing at the urging of the administration to assess safety and soundness issues and to review a recent report by the Office of Federal Housing Enterprise Oversight (OFHEO) that had uncovered accounting discrepancies within the two entities.[49] Sony VPCF11M1E/H Battery

 

Sony VPCF13Z8E/BI Battery The hearings never resulted in new legislation or formal investigation of Fannie Mae and Freddie Mac, as many of the committee members refused to accept the report and instead rebuked OFHEO for their attempt at regulation.[50] Sony VPCF11S1E/B Battery

 

Sony VPCF13Z8E Battery Some believe this was an early warning to the systemic risk that the growing market in subprime mortgages posed to the U.S. financial system that went unheeded.[51]

 

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A 2000 United States Department of the Treasury study of lending trends for 305 cities from 1993 to 1998 showed that $467 billion of mortgage lending was made by Community Reinvestment Act (CRA)-covered lenders into low and mid level income (LMI) borrowers and neighborhoods, representing 10% of all U.S. mortgage lending during the period. Sony VPCF115FG/B Battery

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The majority of these were prime loans. Sub-prime loans made by CRA-covered institutions constituted a 3% market share of LMI loans in 1998,[52] but in the run-up to the crisis, fully 25% of all sub-prime lending occurred at CRA-covered institutions and another 25% of sub-prime loans had some connection with CRA.[53] Sony VPCF22J1E Battery

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An analysis by the Federal Reserve Bank of Dallas in 2009, however, concluded unequivocally that the CRA was not responsible for the mortgage loan crisis, pointing out that CRA rules have been in place since 1995 whereas the poor lending emerged only a decade later.[54Sony VPCF22L1E Battery

 

] Furthermore, most sub-prime loans were not made to the LMI borrowers targeted by the CRA, especially in the years 2005–2006 leading up to the crisis. Nor did it find any evidence that lending under the CRA rules increased delinquency rates or that the CRA indirectly influenced independent mortgage lenders to ramp up sub-prime lending. Sony VPCF22M1E Battery

 

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Economist Paul Krugman argued in January 2010 that the simultaneous growth of the residential and commercial real estate pricing bubbles undermines the case made by those who argue that Fannie Mae, Freddie Mac, CRA or predatory lending were primary causes of the crisis. In other words, bubbles in both markets developed even though only the residential market was affected by these potential causes.[5Sony VPCF22S1E Battery

 

Sony VPCF13J0E/H Battery5] Others have pointed out that there were not enough of these loans made to cause a crisis of this magnitude. In an article in Portfolio Magazine, Michael Lewis spoke with one trader who noted that “There weren’t enough Americans with [bad] credit taking out [bad loans] to satisfy investors’ appetite for the end product.” Essentially, Sony VPCF22S8E Battery

 

Sony VPCF13E8E Battery investment banks and hedge funds used financial innovation to enable large wagers to be made, far beyond the actual value of the underlying mortgage loans, using derivatives called credit default swaps, collateralized debt obligations and synthetic CDOs.[56]

 

As of March 2011 the FDIC has had to pay out $9 billion to cover losses on bad loans at 165 failed financial institutions.[57

 

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Growth of the housing bubble

Main article: United States housing bubble

 

 

A graph showing the median and average sales prices of new homes sold in the United States between 1963 and 2008 (not adjusted for inflation)[58]

Between 1997 and 2006, the price of the typical American house increased by 124%.[59] During the two decades ending in 2001, the national median home price ranged from 2.9 to 3.1 times median household income. This ratio rose to 4.0 in 2004, and 4.6 in 2006.[6] Sony VPCF23M1E Battery

0] This housing bubble resulted in many homeowners refinancing their homes at lower interest rates, or financing consumer spending by taking out second mortgages secured by the price appreciation.

 

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In a Peabody Award winning program, NPR correspondents argued that a “Giant Pool of Money” (represented by $70 trillion in worldwide fixed income investments) sought higher yields than those offered by U.S. Treasury bonds early in the decade. This pool of money had roughly doubled in size from 2000 to 2007,

 

Sony VPCF12F4E/H Battery yet the supply of relatively safe, income generating investments had not grown as fast. Investment banks on Wall Street answered this demand with products such as the mortgage-backed security and the collateralized debt obligation that were assigned safe ratings by the credit rating agencies.[61]

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In effect, Wall Street connected this pool of money to the mortgage market in the U.S., with enormous fees accruing to those throughout the mortgage supply chain, from the mortgage broker selling the loans,

 

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to small banks that funded the brokers and the large investment banks behind them. By approximately 2003, the supply of mortgages originated at traditional lending standards had been exhausted, and continued strong demand began to drive down lending standards.[61]

 

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The collateralized debt obligation in particular enabled financial institutions to obtain investor funds to finance subprime and other lending, extending or increasing the housing bubble and generating large fees.

 

Sony VPCF11S1E BatteryThis essentially places cash payments from multiple mortgages or other debt obligations into a single pool from which specific securities draw in a specific sequence of priority. Those securities first in line received investment-grade ratings from rating agencies. Securities with lower priority had lower credit ratings but theoretically a higher rate of return on the amount invested.[62][63] Sony VPCF23Q1E Battery

 

 

By September 2008, average U.S. housing prices had declined by over 20% from their mid-2006 peak.[64][65] As prices declined, borrowers with adjustable-rate mortgages could not refinance to avoid the higher payments associated with rising interest rates and began to default. During 2007,

 

Sony VPCF24M1E Battery lenders began foreclosure proceedings on nearly 1.3 million properties, a 79% increase over 2006.[66] This increased to 2.3 million in 2008, an 81% increase vs. 2007.[67] By August 2008, 9.2% of all U.S. mortgages outstanding were either delinquent or in foreclosure.[68] By September 2009, this had risen to 14.4%.[69] Sony VPCF231S1E Battery

 

Easy credit conditions

Lower interest rates encouraged borrowing. From 2000 to 2003, the Federal Reserve lowered the federal funds rate target from 6.5% to 1.0%.[7Sony VPCF23S1E Battery

0] This was done to soften the effects of the collapse of the dot-com bubble and the September 2001 terrorist attacks, as well as to combat a perceived risk of deflation.[71] As early as 2002 it was apparent that credit was fueling housing instead of business investment as some economists went so far as to advocate that the Fed “needs to create a housing bubble to replace the Nasdaq bubble”.[72]

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U.S. current account deficit.

Additional downward pressure on interest rates was created by the high and rising U.S. current account deficit, which peaked along with the housing bubble in 2006. Federal Reserve Chairman Ben Bernanke explained how trade deficits required the U.S. to borrow money from abroad, in the process bidding up bond prices and lowering interest rates.[73]

 

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Bernanke explained that between 1996 and 2004, the U.S. current account deficit increased by $650 billion, from 1.5% to 5.8% of GDP. Financing these deficits required the country to borrow large sums from abroad,

 

Sony VAIO VPCS11X9E Batterymuch of it from countries running trade surpluses. These were mainly the emerging economies in Asia and oil-exporting nations. The balance of payments identity requires that a country (such as the U.S.) running a current account deficit also have a capital account (investment) surplus of the same amount. Hence large and growing amounts of foreign funds (capital) flowed into the U.S. to finance its imports.
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All of this created demand for various types of financial assets, raising the prices of those assets while lowering interest rates. Foreign investors had these funds to lend either because they had very high personal savings rates (as high as 40% in China) or because of high oil prices. Ben Bernanke has referred to this as a “saving glut”.[74] Sony VAIO VPCS11D7E Battery

 

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A flood of funds (capital or liquidity) reached the U.S. financial markets. Foreign governments supplied funds by purchasing Treasury bonds and thus avoided much of the direct impact of the crisis. U.S. households, Sony VAIO VPCS11E7E Battery

on the other hand, used funds borrowed from foreigners to finance consumption or to bid up the prices of housing and financial assets. Financial institutions invested foreign funds in mortgage-backed securities. Sony VAIO VPCS11F7E Battery

The Fed then raised the Fed funds rate significantly between July 2004 and July 2006.[75] This contributed to an increase in 1-year and 5-year adjustable-rate mortgage (ARM) rates, making ARM interest rate resets more expensive for homeowners.[ Sony VAIO VPCS11G7E Battery

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76] This may have also contributed to the deflating of the housing bubble, as asset prices generally move inversely to interest rates, and it became riskier to speculate in housing.[77][78] U.S. housing and financial assets dramatically declined in value after the housing bubble burst.[79][80]

 

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Weak and fraudulent underwriting practices

Testimony given to the Financial Crisis Inquiry Commission by Richard M. Bowen III on events during his tenure as the Business Chief Underwriter for Correspondent Lending in the Consumer Lending Group for Citigroup (where he was responsible for over 220 professional underwriters) suggests that by the final years of the U.S. housing bubble (2006–2007), Sony VAIO VPCS11M1E/W Battery

the collapse of mortgage underwriting standards was endemic. His testimony stated that by 2006, 60% of mortgages purchased by Citi from some 1,600 mortgage companies were “defective” (were not underwritten to policy, or did not contain all policy-required documents) – this,

 

Sony VAIO VPCS13S9E Battery despite the fact that each of these 1,600 originators were contractually responsible (certified via representations and warrantees) that their mortgage originations met Citi’s standards. Moreover, during 2007, “defective mortgages (from mortgage originators contractually bound to perform underwriting to Citi’s standards) increased… to over 80% of production”.[81]

 

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In separate testimony to Financial Crisis Inquiry Commission, officers of Clayton Holdings—the largest residential loan due diligence and securitization surveillance company in the United States and Europe—testified that Clayton’s review of over 900,000 mortgages issued from January 2006

 

Sony VAIO VPCS13S8R/S Battery to June 2007 revealed that scarcely 54% of the loans met their originators’ underwriting standards. The analysis (conducted on behalf of 23 investment and commercial banks, including 7 “too big to fail” banks) additionally showed that 28% of the sampled loans did not meet the minimal standards of any issuer.

 

Sony VAIO VPCS12E7E Battery Clayton’s analysis further showed that 39% of these loans (i.e. those not meeting any issuer’s minimal underwriting standards) were subsequently securitized and sold to investors.[82][83]

 

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There is strong evidence that the GSEs — due to their large size and market power — were far more effective at policing underwriting by originators and forcing underwriters to repurchase defective loans. By contrast, private securitizers have been far less aggressive and less effective in recovering losses from originators on behalf of investors.[7] Sony VAIO VPCS11M9R/B Battery

 

 

Predatory lending

Predatory lending refers to the practice of unscrupulous lenders, enticing borrowers to enter into “unsafe” or “unsound” secured loans for inappropriate purposes.[84Sony VAIO VPCS11V9E/B Battery

] A classic bait-and-switch method was used by Countrywide Financial, advertising low interest rates for home refinancing.

 

Sony VAIO VPCS12C5E Battery Such loans were written into extensively detailed contracts, and swapped for more expensive loan products on the day of closing. Whereas the advertisement might state that 1% or 1.5% interest would be charged, the consumer would be put into an adjustable rate mortgage (ARM) in which the interest charged would be greater than the amount of interest paid.

 

Sony VAIO VPCS12B7E Battery This created negative amortization, which the credit consumer might not notice until long after the loan transaction had been consummated.

 

Countrywide, sued by California Attorney General Jerry Brown for “unfair business practices” and “false advertising” was making high cost mortgages “to homeowners with weak credit, adjustable rate mortgages (ARMs) that allowed homeowners to make interest-only payments”.[85] Sony VAIO VPCS12A7E Battery

When housing prices decreased, homeowners in ARMs then had little incentive to pay their monthly payments, since their home equity had disappeared. This caused Countrywide’s financial condition to deteriorate, ultimately resulting in a decision by the Office of Thrift Supervision to seize the lender. Sony VAIO VPCS12A7R Battery

 

Former employees from Ameriquest, which was United States’ leading wholesale lender,[86] described a system in which they were pushed to falsify mortgage documents and then sell the mortgages to Wall Street banks eager to make fast profits.[86] There is growing evidence that such mortgage frauds may be a cause of the crisis.[86] Toshiba PA3733U-1BRS Battery

 

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Deregulation

Further information: Government policies and the subprime mortgage crisis

Critics such as economist Paul Krugman and U.S. Treasury Secretary Timothy Geithner have argued that the regulatory framework did not keep pace with financial innovation, such as the increasing importance of the shadow banking system, derivatives and off-balance sheet financing. A recent OECD study[87Toshiba PA3734U-1BRS Battery

] suggest that bank regulation based on the Basel accords encourage unconventional business practices and contributed to or even reinforced the financial crisis. In other cases, laws were changed or enforcement weakened in parts of the financial system. Key examples include:

 

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Jimmy Carter’s Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA) phased out a number of restrictions on banks’ financial practices, broadened their lending powers, and raised the deposit insurance limit from $40,000 to $100,000 (raising the problem of moral hazard).[88] Banks rushed into real estate lending, speculative lending, and other ventures just as the economy soured.[citation needed]

 

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In October 1982, U.S. President Ronald Reagan signed into law the Garn–St. Germain Depository Institutions Act, which provided for adjustable-rate mortgage loans, began the process of banking deregulation,[citation needed] and contributed to the savings and loan crisis of the late 1980s/early 1990s.[89]

 

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In November 1999, U.S. President Bill Clinton signed into law the Gramm–Leach–Bliley Act, which repealed part of the Glass–Steagall Act of 1933.

 

Toshiba PA5024U-1BRS Battery This repeal has been criticized for reducing the separation between commercial banks (which traditionally had fiscally conservative policies) and investment banks (which had a more risk-taking culture).[90][91] However, the vast majority of failures were at institutions that were created by Glass-Steagall.[92]

 

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In 2004, the U.S. Securities and Exchange Commission relaxed the net capital rule, which enabled investment banks to substantially increase the level of debt they were taking on, fueling the growth in mortgage-backed securities supporting subprime mortgages. The SEC has conceded that self-regulation of investment banks contributed to the crisis.[93][94] Toshiba PA3821U-1BRS Battery

 

Financial institutions in the shadow banking system are not subject to the same regulation as depository banks, allowing them to assume additional debt obligations relative to their financial cushion or capital base.

 

Toshiba A3635U-1BRM Battery [95] This was the case despite the Long-Term Capital Management debacle in 1998, where a highly-leveraged shadow institution failed with systemic implications.

Regulators and accounting standard-setters allowed depository banks such as Citigroup to move significant amounts of assets and liabilities off-balance sheet into complex legal entities called structured investment vehicles,

 

Toshiba PA3594U-1BRS Battery masking the weakness of the capital base of the firm or degree of leverage or risk taken. One news agency estimated that the top four U.S. banks will have to return between $500 billion and $1 trillion to their balance sheets during 2009.[9

Toshiba PA3780U-1BRS Battery6] This increased uncertainty during the crisis regarding the financial position of the major banks.[97] Off-balance sheet entities were also used by Enron as part of the scandal that brought down that company in 2001.[98]

 

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As early as 1997, Federal Reserve Chairman Alan Greenspan fought to keep the derivatives market unregulated.[99] With the advice of the President’s Working Group on Financial Markets,[100] the U.S. Congress and President allowed the self-regulation of the over-the-counter derivatives market when they enacted the Commodity Futures Modernization Act of 2000.

Toshiba PA3784U-1BRS Battery       Derivatives such as credit default swaps (CDS) can be used to hedge or speculate against particular credit risks. The volume of CDS outstanding increased 100-fold from 1998 to 2008, with estimates of the debt covered by CDS contracts, as of November 2008, ranging from US$33 to $47 trillion. Toshiba PA3785U-1BRS Battery

Total over-the-counter (OTC) derivative notional value rose to $683 trillion by June 2008.[101] Warren Buffett famously referred to derivatives as “financial weapons of mass destruction” in early 2003.[102][103]

 

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Increased debt burden or over-leveraging

 

 

Leverage ratios of investment banks increased significantly 2003–07

Prior to the crisis, financial Institutions became highly leveraged, increasing their appetite for risky investments and reducing their resilience in case of losses. Sony VAIO PCG-3B1M Battery

 

Sony VAIO PCG-71312M Battery Much of this leverage was achieved using complex financial instruments such as off-balance sheet securitization and derivatives, which made it difficult for creditors and regulators to monitor and try to reduce financial institution risk levels.[9] These instruments also made it virtually impossible to reorganize financial institutions in bankruptcy, and contributed to the need for government bailouts.[9]

 

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Household debt relative to disposable income and GDP.

U.S. households and financial institutions became increasingly indebted or overleveraged during the years preceding the crisis.[104] This increased their vulnerability to the collapse of the housing bubble and worsened the ensuing economic downturn.[105] Key statistics include: Sony VAIO PCG-3D1M Battery

 

 

Free cash used by consumers from home equity extraction doubled from $627 billion in 2001 to $1,428 billion in 2005 as the housing bubble built, a total of nearly $5 trillion dollars over the period, contributing to economic growth worldwide.[106][10

 

Sony VAIO PCG-41112M Battery7][108] U.S. home mortgage debt relative to GDP increased from an average of 46% during the 1990s to 73% during 2008, reaching $10.5 trillion.[109]

 

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USA household debt as a percentage of annual disposable personal income was 127% at the end of 2007, versus 77% in 1990.[104] In 1981, U.S. private debt was 123% of GDP; by the third quarter of 2008, it was 290%.[110]

 

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From 2004–07, the top five U.S. investment banks each significantly increased their financial leverage (see diagram), which increased their vulnerability to a financial shock. Changes in capital requirements, intended to keep U.S. banks competitive with their European counterparts, allowed lower risk weightings for AAA securities.

Sony VAIO PCG-7154M Battery The shift from first-loss tranches to AAA tranches was seen by regulators as a risk reduction that compensated the higher leverage.[111] These five institutions reported over $4.1 trillion in debt for fiscal year 2007, about 30% of USA nominal GDP for 2007. Lehman Brothers was liquidated,

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Bear Stearns and Merrill Lynch were sold at fire-sale prices, and Goldman Sachs and Morgan Stanley became commercial banks, subjecting themselves to more stringent regulation. With the exception of Lehman, these companies required or received government support.[112]

 

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Fannie Mae and Freddie Mac, two U.S. Government sponsored enterprises, owned or guaranteed nearly $5 trillion in mortgage obligations at the time they were placed into conservatorship by the U.S. government in September 2008.[113][114]

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These seven entities were highly leveraged and had $9 trillion in debt or guarantee obligations; yet they were not subject to the same regulation as depository banks.[95][115] Sony VAIO PCG-3G2M Battery

 

 

 

Behavior that may be optimal for an individual (e.g., saving more during adverse economic conditions) can be detrimental if too many individuals pursue the same behavior, as ultimately one person’s consumption is another person’s income. Sony VAIO PCG-5R1M Battery      Too many consumers attempting to save (or pay down debt) simultaneously is called the paradox of thrift and can cause or deepen a recession. Economist Hyman Minsky also described a “paradox of deleveraging” as financial institutions that have too much leverage (debt relative to equity) cannot all de-leverage simultaneously without significant declines in the value of their assets.[105]

 

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During April 2009, U.S. Federal Reserve Vice Chair Janet Yellen discussed these paradoxes: “Once this massive credit crunch hit, it didn’t take long before we were in a recession. The recession, in turn, deepened the credit crunch as demand and employment fell, and credit losses of financial institutions surged. Indeed,

 

Sony VAIO PCG-7171M Batterywe have been in the grips of precisely this adverse feedback loop for more than a year. A process of balance sheet deleveraging has spread to nearly every corner of the economy. Consumers are pulling back on purchases, especially on durable goods, to build their savings. Businesses are cancelling planned investments and laying off workers to preserve cash. And,

 

Sony VAIO PCG-9Z1M Battery financial institutions are shrinking assets to bolster capital and improve their chances of weathering the current storm. Once again, Minsky understood this dynamic. He spoke of the paradox of deleveraging, in which precautions that may be smart for individuals and firms—and indeed essential to return the economy to a normal state—nevertheless magnify the distress of the economy as a whole.”[105]

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Financial innovation and complexity

 

This section may stray from the topic of the article into the topic of another article, financial innovation. Please help improve this section or discuss this issue on the talk page. (December 2011)

 

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IMF Diagram of CDO and RMBS

The term financial innovation refers to the ongoing development of financial products designed to achieve particular client objectives, such as offsetting a particular risk exposure (such as the default of a borrower) or to assist with obtaining financing. Examples pertinent to this crisis included: the adjustable-rate mortgage;

 

Sony VAIO PCG-5N2M Battery the bundling of subprime mortgages into mortgage-backed securities (MBS) or collateralized debt obligations (CDO) for sale to investors, a type of securitization; and a form of credit insurance called credit default swaps (CDS).

Sony VAIO PCG-3C2M Battery The usage of these products expanded dramatically in the years leading up to the crisis. These products vary in complexity and the ease with which they can be valued on the books of financial institutions.

 

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CDO issuance grew from an estimated $20 billion in Q1 2004 to its peak of over $180 billion by Q1 2007, then declined back under $20 billion by Q1 2008. Further, the credit quality of CDO’s declined from 2000–2007,

 

Sony VAIO PCG-8141M Batteryas the level of subprime and other non-prime mortgage debt increased from 5% to 36% of CDO assets.[116] As described in the section on subprime lending, the CDS and portfolio of CDS called synthetic CDO[dubious – discuss][citation needed] enabled a theoretically infinite amount to be wagered on the finite value of housing loans outstanding, Sony VAIO PCG-3C1M Battery

provided that buyers and sellers of the derivatives could be found. For example, buying a CDS to insure a CDO ended up giving the seller the same risk[citation needed] as if they owned the CDO, when those CDO’s became worthless.[117]

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Diagram of CMLTI 2006 – NC2

This boom in innovative financial products went hand in hand with more complexity. It multiplied the number of actors connected to a single mortgage (including mortgage brokers, specialized originators, the securitizers and their due diligence firms, managing agents and trading desks,

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and finally investors, insurances and providers of repo funding). With increasing distance from the underlying asset these actors relied more and more on indirect information (including FICO scores on creditworthiness, Sony VAIO PCG-3F1M Battery appraisals and due diligence checks by third party organizations, and most importantly the computer models of rating agencies and risk management desks). Instead of spreading risk this provided the ground for fraudulent acts, misjudgments and finally market collapse.[118] Sony VAIO PCG-5G2M Battery

 

 

Martin Wolf further wrote in June 2009 that certain financial innovations enabled firms to circumvent regulations, such as off-balance sheet financing that affects the leverage or capital cushion reported by major banks, stating: “…an enormous part of what banks did in the early part of this decade – the off-balance-sheet vehicles, the derivatives and the ‘shadow banking system’ itself – was to find a way round regulation.”[119] Sony VAIO PCG-5J1M Battery

 

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Incorrect pricing of risk

 

 

A protester on Wall Street in the wake of the AIG bonus payments controversy is interviewed by news media.

The pricing of risk refers to the incremental compensation required by investors for taking on additional risk, which may be measured by interest rates or fees. Several scholars have argued that a lack of transparency about banks’ risk exposures prevented markets from correctly pricing risk before the crisis, Sony VAIO PCG-5J4M Battery

enabled the mortgage market to grow larger than it otherwise would have, and made the financial crisis far more disruptive than it would have been if risk levels had been disclosed in a straightforward, readily understandable format.[7][9]

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For a variety of reasons, market participants did not accurately measure the risk inherent with financial innovation such as MBS and CDOs or understand its impact on the overall stability of the financial system.[21]

 

Sony VAIO PCG-8112M Battery For example, the pricing model for CDOs clearly did not reflect the level of risk they introduced into the system. Banks estimated that $450bn of CDO were sold between “late 2005 to the middle of 2007″; among the $102bn of those that had been liquidated,

 

Sony VAIO PCG-7134M BatteryJPMorgan estimated that the average recovery rate for “high quality” CDOs was approximately 32 cents on the dollar, while the recovery rate for mezzanine CDO was approximately five cents for every dollar.[120]

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Another example relates to AIG, which insured obligations of various financial institutions through the usage of credit default swaps. The basic CDS transaction involved AIG receiving a premium in exchange for a promise to pay money to party A in the event party B defaulted. Sony VAIO PCG-5J5M Battery

However, AIG did not have the financial strength to support its many CDS commitments as the crisis progressed and was taken over by the government in September 2008. U.S. taxpayers provided over $180 billion in government support to AIG during 2008 and early 2009, through which the money flowed to various counterparties to CDS transactions, including many large global financial institutions.[121][122] Sony VAIO PCG-5L2M Battery

 

 

The limitations of a widely-used financial model also were not properly understood.[123][124] This formula assumed that the price of CDS was correlated with and could predict the correct price of mortgage-backed securities. Because it was highly tractable, it rapidly came to be used by a huge percentage of CDO and CDS investors, issuers, and rating agencies.[124] According to one wired.com article:

 

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Then the model fell apart. Cracks started appearing early on, when financial markets began behaving in ways that users of Li’s formula hadn’t expected. Sony VAIO PCG-6S4M Battery

 

Sony VAIO PCG-7122M BatteryThe cracks became full-fledged canyons in 2008—when ruptures in the financial system’s foundation swallowed up trillions of dollars and put the survival of the global banking system in serious peril… Li’s Gaussian copula formula will go down in history as instrumental in causing the unfathomable losses that brought the world financial system to its knees.[124]

 

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As financial assets became more and more complex, and harder and harder to value, investors were reassured by the fact that both the international bond rating agencies and bank regulators, who came to rely on them, accepted as valid some complex mathematical models which theoretically showed the risks were much smaller than they actually proved to be.[1

 

Sony VAIO PCG-7113M Battery25] George Soros commented that “The super-boom got out of hand when the new products became so complicated that the authorities could no longer calculate the risks and started relying on the risk management methods of the banks themselves. Similarly, the rating agencies relied on the information provided by the originators of synthetic products. It was a shocking abdication of responsibility.”[126]

 

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Moreover, a conflict of interest between professional investment managers and their institutional clients, combined with a global glut in investment capital, led to bad investments by asset managers in over-priced credit assets.

 

Sony VAIO PCG-8Z3M BatteryProfessional investment managers generally are compensated based on the volume of client assets under management. There is, therefore, an incentive for asset managers to expand their assets under management in order to maximize their compensation.

 

Sony VAIO PCG-8Z2M Battery As the glut in global investment capital caused the yields on credit assets to decline, asset managers were faced with the choice of either investing in assets where returns did not reflect true credit risk or returning funds to clients. Many asset managers chose to continue to invest client funds in over-priced (under-yielding) investments,

 

Sony VAIO PCG-8Z1M Battery to the detriment of their clients, in order to maintain their assets under management. This choice was supported by a “plausible deniability” of the risks associated with subprime-based credit assets because the loss experience with early “vintages” of subprime loans was so low.[127]

 

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Despite the dominance of the above formula, there are documented attempts of the financial industry, occurring before the crisis, to address the formula limitations, specifically the lack of dependence dynamics and the poor representation of extreme events.[128] The volume “Credit Correlation: Life After Copulas”,

Sony VAIO PCG-8Y2M Battery published in 2007 by World Scientific, summarizes a 2006 conference held by Merrill Lynch in London where several practitioners attempted to propose models rectifying some of the copula limitations. See also the article by Donnelly and Embrechts[129] and the book by Brigo, Pallavicini and Torresetti, that reports relevant warnings and research on CDOs appeared in 2006.[130]

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Mortgage risks were underestimated by every institution in the chain from originator to investor by underweighting the possibility of falling housing prices based on historical trends of the past 50 years. Limitations of default and prepayment models, Sony VAIO PCG-6W2M Battery

the heart of pricing models, led to overvaluation of mortgage and asset-backed products and their derivatives by originators, securitizers, broker-dealers, rating-agencies, insurance underwriters and investors. [131][132] Sony VAIO PCG-6W1M Battery

 

 

Boom and collapse of the shadow banking system

 

 

Securitization markets were impaired during the crisis

There is strong evidence that the riskiest, worst performing mortgages were funded through the “shadow banking system” and that competition from the shadow banking system may have pressured more traditional institutions to lower their own underwriting standards and originate riskier loans.[7]

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In a June 2008 speech, President and CEO of the New York Federal Reserve Bank Timothy Geithner—who in 2009 became Secretary of the United States Treasury—placed significant blame for the freezing of credit markets on a “run” on the entities in the “parallel” banking system, also called the shadow banking system. Sony PCG-61211M Battery

These entities became critical to the credit markets underpinning the financial system, but were not subject to the same regulatory controls. Further, these entities were vulnerable because of maturity mismatch, meaning that they borrowed short-term in liquid markets to purchase long-term, illiquid and risky assets.

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This meant that disruptions in credit markets would make them subject to rapid deleveraging, selling their long-term assets at depressed prices. He described the significance of these entities:


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In early 2007, asset-backed commercial paper conduits, in structured investment vehicles, in auction-rate preferred securities, tender option bonds and variable rate demand notes, had a combined asset size of roughly $2.2 trillion. Assets financed overnight in triparty repo grew to $2.5 trillion.

 

Sony PCG-91111M BatteryAssets held in hedge funds grew to roughly $1.8 trillion. The combined balance sheets of the then five major investment banks totaled $4 trillion. In comparison, the total assets of the top five bank holding companies in the United States at that point were just over $6 trillion,

 

Sony PCG-61713M Batteryand total assets of the entire banking system were about $10 trillion. The combined effect of these factors was a financial system vulnerable to self-reinforcing asset price and credit cycles.[33]

 

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Paul Krugman, laureate of the Nobel Prize in Economics, described the run on the shadow banking system as the “core of what happened” to cause the crisis. He referred to this lack of controls as “malign neglect” and argued that regulation should have been imposed on all banking-like activity.[95]

 

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The securitization markets supported by the shadow banking system started to close down in the spring of 2007 and nearly shut-down in the fall of 2008. More than a third of the private credit markets thus became unavailable as a source of funds.[133] According to the Brookings Institution,

 

Sony PCG-71911M Batterythe traditional banking system does not have the capital to close this gap as of June 2009: “It would take a number of years of strong profits to generate sufficient capital to support that additional lending volume.” The authors also indicate that some forms of securitization are “likely to vanish forever, having been an artifact of excessively loose credit conditions.”[134

 

Sony PCG-71811M Battery]

 

Economist Mark Zandi testified to the Financial Crisis Inquiry Commission in January 2010: “The securitization markets also remain impaired, as investors anticipate more loan losses. Investors are also uncertain about coming legal and accounting rule changes and regulatory reforms. Private bond issuance of residential and commercial mortgage-backed securities, asset-backed securities,

 

Sony PCG-71212M Batteryand CDOs peaked in 2006 at close to $2 trillion…In 2009, private issuance was less than $150 billion, and almost all of it was asset-backed issuance supported by the Federal Reserve’s TALF program to aid credit card, auto and small-business lenders. Issuance of residential and commercial mortgage-backed securities and CDOs remains dormant.”[135]

 

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Commodities boom

Main article: 2000s commodities boom

Rapid increases in a number of commodity prices followed the collapse in the housing bubble. The price of oil nearly tripled from $50 to $147 from early 2007 to 2008, before plunging as the financial crisis began to take hold in late 2008.

Sony PCG-71311M Battery136] Experts debate the causes, with some attributing it to speculative flow of money from housing and other investments into commodities, some to monetary policy,[13[ Sony PCG-71213M Battery

7] and some to the increasing feeling of raw materials scarcity in a fast growing world, leading to long positions taken on those markets, such as Chinese increasing presence in Africa. An increase in oil prices tends to divert a larger share of consumer spending into gasoline, which creates downward pressure on economic growth in oil importing countries, Sony PCG-61211M Battery

 

Sony VGP-BPS22A Battery as wealth flows to oil-producing states.[138] A pattern of spiking instability in the price of oil over the decade leading up to the price high of 2008 has been recently identified.[139] The destabilizing effects of this price variance has been proposed as a contributory factor in the financial crisis.

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In testimony before the Senate Committee on Commerce, Science, and Transportation on June 3, 2008, former director of the CFTC Division of Trading & Markets (responsible for enforcement) Michael Greenberger specifically named the Atlanta-based IntercontinentalExchange, founded by Goldman Sachs,

 

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Morgan Stanley and BP as playing a key role in speculative run-up of oil futures prices traded off the regulated futures exchanges in London and New York.[140] However, the IntercontinentalExchange (ICE) had been regulated by both European and U.S. authorities since its purchase of the International Petroleum Exchange in 2001. Mr Greenberger was later corrected on this matter.[141]

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Global copper prices

Copper prices increased at the same time as the oil prices. Copper traded at about $2,500 per tonne from 1990 until 1999, when it fell to about $1,600. The price slump lasted until 2004 which saw a price surge that had copper reaching $7,040 per tonne in 2008.[142] Sony PCG-71213M Battery

 

 

 

Nickel prices boomed in the late 1990s, then the price of nickel imploded from around $51,000 /£36,700 per metric ton in May 2007 to about $11,550/£8,300 per metric ton in January 2009. Prices were only just starting to recover as of January 2010, but most of Australia’s nickel mines had gone bankrupt by then.[14

 

Sony VGP-BPL26 Battery3] As the price for high grade nickel sulphate ore recovered in 2010, so did the Australian nickel mining industry.[144]

 

Coincidentally with these price fluctuations, long-only commodity index funds became popular – by one estimate investment increased from $90 billion in 2006 to $200 billion at the end of 2007, while commodity prices increased 71% – which raised concern as to whether these index funds caused the commodity bubble.[14

 

Sony VGP-BPS26 Battery5] The empirical research has been mixed.[145]

 

Systemic crisis

Another analysis, different from the mainstream explanation, is that the financial crisis is merely a symptom of another, deeper crisis, which is a systemic crisis of capitalism itself.[146]

 

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Ravi Batra’s theory is that growing inequality of financial capitalism produces speculative bubbles that burst and result in depression and major political changes. He has also suggested that a “demand gap” related to differing wage and productivity growth explains deficit and debt dynamics important to stock market developments.[147][148] Sony PCG-71311M Battery

 

 

John Bellamy Foster, a political economy analyst and editor of the Monthly Review, believes that the decrease in GDP growth rates since the early 1970s is due to increasing market saturation.[149]

 

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John C. Bogle wrote during 2005 that a series of unresolved challenges face capitalism that have contributed to past financial crises and have not been sufficiently addressed:

 

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Corporate America went astray largely because the power of managers went virtually unchecked by our gatekeepers for far too long… They failed to ‘keep an eye on these geniuses’ to whom they had entrusted the responsibility of the management of America’s great corporations. Sony PCG-71313M Battery

 

Echoing the central thesis of James Burnham’s 1941 seminal book, The Managerial Revolution, Bolge cites particular issues, including:[150][151]

 

that “Manager’s capitalism” has replaced “owner’s capitalism”, meaning management runs the firm for its benefit rather than for the shareholders, a variation on the principal–agent problem;

the burgeoning executive compensation;

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the management of earnings, mainly a focus on share price rather than the creation of genuine value; and

the failure of gatekeepers, including auditors, boards of directors, Wall Street analysts, and career politicians.

 

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An analysis conducted by Mark Roeder, a former executive at the Swiss-based UBS Bank, suggested that large scale momentum, or The Big Mo “played a pivotal role” in the 2008–09 global financial crisis. Roeder suggested that “recent technological advances, such as computer-driven trading programs, together with the increasingly interconnected nature of markets, has magnified the momentum effect. This has made the financial sector inherently unstable.”[152] Sony PCG-71212M Battery

 

Robert Reich has attributed the current economic downturn to the stagnation of wages in the United States, particularly those of the hourly workers who comprise 80% of the workforce. His claim is that this stagnation forced the population to borrow in order to meet the cost of living.[153] Sony PCG-71811M Battery

 

 

Role of economic forecasting

The financial crisis was not widely predicted by mainstream economists, who instead spoke of the Great Moderation. A number of heterodox economists predicted the crisis, with varying arguments. Dirk Bezemer in his research[15

 

Sony VAIO PCG-7186M Battery4] credits (with supporting argument and estimates of timing) 12 economists with predicting the crisis: Dean Baker (US), Wynne Godley (UK), Fred Harrison (UK), Michael Hudson (US), Eric Janszen (US), Steve Keen (Australia), Jakob Brøchner Madsen & Jens Kjaer Sørensen (Denmark), Kurt Richebächer (US), Nouriel Roubini (US), Peter Schiff (US), and Robert Shiller (US).

 

Sony VAIO PCG-7171M Battery Examples of other experts who gave indications of a financial crisis have also been given.[155][156][157] Not surprisingly, the Austrian economic school regarded the crisis as a vindication and classic example of a predictable credit-fueled bubble that could not forestall the disregarded but inevitable effect of an artificial,

 

Sony VAIO PCG-9Z1M Battery manufactured laxity in monetary supply,[158] a perspective that even former Fed Chair Alan Greenspan in Congressional testimony confessed himself forced to return to.[159]

 

A cover story in BusinessWeek magazine claims that economists mostly failed to predict the worst international economic crisis since the Great Depression of 1930s.[16

 

Sony VAIO PCG-5S1M Battery0] The Wharton School of the University of Pennsylvania’s online business journal examines why economists failed to predict a major global financial crisis.[161] Popular articles published in the mass media have led the general public to believe that the majority of economists have failed in their obligation to predict the financial crisis. For example,

 

Sony VAIO PCG-5P1M Batteryan article in the New York Times informs that economist Nouriel Roubini warned of such crisis as early as September 2006, and the article goes on to state that the profession of economics is bad at predicting recessions.[162

 

Sony VAIO PCG-5N2M Battery] According to The Guardian, Roubini was ridiculed for predicting a collapse of the housing market and worldwide recession, while The New York Times labelled him “Dr. Doom”.[163]

 

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Shiller, an expert in housing markets, wrote an article a year before the collapse of Lehman Brothers in which he predicted that a slowing US housing market would cause the housing bubble to burst, leading to financial collapse.[164] Schiff regularly appeared on television in the years before the crisis and warned of the impending real estate collapse.[165]

 

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Within mainstream financial economics, most believe that financial crises are simply unpredictable,[166] following Eugene Fama’s efficient-market hypothesis and the related random-walk hypothesis, which state respectively that markets contain all information about possible future movements, and that the movement of financial prices are random and unpredictable.

 

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Lebanese-American trader and financial risk engineer Nassim Nicholas Taleb, author of the 2007 book The Black Swan, spent years warning against the breakdown of the banking system in particular and the economy in general owing to their use of bad risk models and reliance on forecasting, and their reliance on bad models, and framed the problem as part of “robustness and fragility”.[167][168

 

Sony VAIO PCG-3J1M Battery] He also took action against the establishment view by making a big financial bet on banking stocks and making a fortune from the crisis (“They didn’t listen, so I took their money”).[169] According to David Brooks from the New York Times, “Taleb not only has an explanation for what’s happening, he saw it coming.”[170]

 

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Impact on financial markets

 

US stock market

The US stock market peaked in October 2007, when the Dow Jones Industrial Average index exceeded 14,000 points. It then entered a pronounced decline, which accelerated markedly in October 2008. By March 2009,

Sony VAIO PCG-3F1M Batterythe Dow Jones average had reached a trough of around 6,600. It has since recovered much of the decline, exceeding 12,000 during most of 2011, and occasionally reaching 13,000 in 2012. It is probable, but debated, whether the Federal Reserve’s aggressive policy of quantitative easing spurred the partial recovery in the stock market.[171][172][173]

 

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Market strategist Phil Dow believes distinctions exist “between the current market malaise” and the Great Depression. He says the Dow Jones average’s fall of more than 50% over a period of 17 months is similar to a 54.7% fall in the Great Depression, followed by a total drop of 89% over the following 16 months.

 

Sony VAIO PCG-71312M Battery“It’s very troubling if you have a mirror image,” said Dow.[174] Floyd Norris, the chief financial correspondent of The New York Times, wrote in a blog entry in March 2009 that the decline has not been a mirror image of the Great Depression, explaining that although the decline amounts were nearly the same at the time, Sony VAIO PCG-3B1M Battery

 

Sony VAIO PCG-7153M Batterythe rates of decline had started much faster in 2007, and that the past year had only ranked eighth among the worst recorded years of percentage drops in the Dow. The past two years ranked third, however.[175]

 

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Financial institutions

See also: Nationalisation of Northern Rock and Federal takeover of Fannie Mae and Freddie Mac

 

 

2007 bank run on Northern Rock, a UK bank

The first notable event signaling a possible financial crisis occurred in the United Kingdom on August 9, 2007 when BNP Paribas, citing “a complete evaporation of liquidity”, blocked withdrawals from three hedge funds.

 

Sony VAIO PCG-7181M Battery The significance of this event was not immediately recognized but soon led to a panic as investors and savers attempted to liquidate assets deposited in highly-leveraged financial institutions.[4]

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The International Monetary Fund estimated that large U.S. and European banks lost more than $1 trillion on toxic assets and from bad loans from January 2007 to September 2009. These losses are expected to top $2.8 trillion from 2007–10. U.S. banks losses were forecast to hit $1 trillion and European bank losses will reach $1.6 trillion. The International Monetary Fund (IMF) estimated that U.S. banks were about 60% through their losses, but British and eurozone banks only 40%.[176]

 

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One of the first victims was Northern Rock, a medium-sized British bank.[177] The highly leveraged nature of its business led the bank to request security from the Bank of England. This in turn led to investor panic and a bank run[1

Sony VAIO PCG-7151M Battery78] in mid-September 2007. Calls by Liberal Democrat Treasury Spokesman Vince Cable to nationalise the institution were initially ignored; in February 2008, however, the British government (having failed to find a private sector buyer) relented, and the bank was taken into public hands. Northern Rock’s problems proved to be an early indication of the troubles that would soon befall other banks and financial institutions. Sony VAIO PCG-3D1M Battery

 

Initially the companies affected were those directly involved in home construction and mortgage lending such as Northern Rock and Countrywide Financial, as they could no longer obtain financing through the credit markets. Over 100 mortgage lenders went bankrupt during 2007 and 2008.

 

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Concerns that investment bank Bear Stearns would collapse in March 2008 resulted in its fire-sale to JP Morgan Chase. The financial institution crisis hit its peak in September and October 2008. Several major institutions either failed, were acquired under duress, or were subject to government takeover. These included Lehman Brothers, Merrill Lynch, Fannie Mae, Freddie Mac, Washington Mutual, Wachovia, Citigroup, and AIG.[179]

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Credit markets and the shadow banking system

 

 

TED spread and components during 2008

During September 2008, the crisis hit its most critical stage. There was the equivalent of a bank run on the money market mutual funds, which frequently invest in commercial paper issued by corporations to fund their operations and payrolls. Withdrawal from money markets were $144.5 billion during one week, versus $7.1 billion the week prior. Sony VAIO PCG-5R1M Battery

This interrupted the ability of corporations to rollover (replace) their short-term debt. The U.S. government responded by extending insurance for money market accounts analogous to bank deposit insurance via a temporary guarantee[18Sony VAIO PCG-3G2M Battery

0] and with Federal Reserve programs to purchase commercial paper. The TED spread, an indicator of perceived credit risk in the general economy, spiked up in July 2007, remained volatile for a year, then spiked even higher in September 2008,[181] reaching a record 4.65% on October 10, 2008.

 

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In a dramatic meeting on September 18, 2008, Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke met with key legislators to propose a $700 billion emergency bailout. Bernanke reportedly told them: “If we don’t do this, Sony VAIO PCG-3C1M Battery

 

Sony VAIO PCG-7171M Battery we may not have an economy on Monday.”[182] The Emergency Economic Stabilization Act, which implemented the Troubled Asset Relief Program (TARP), was signed into law on October 3, 2008.[183]

 

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Economist Paul Krugman and U.S. Treasury Secretary Timothy Geithner explain the credit crisis via the implosion of the shadow banking system, which had grown to nearly equal the importance of the traditional commercial banking sector as described above.

Sony VAIO PCG-8131M Battery Without the ability to obtain investor funds in exchange for most types of mortgage-backed securities or asset-backed commercial paper, investment banks and other entities in the shadow banking system could not provide funds to mortgage firms and other corporations.[33][95]

 

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This meant that nearly one-third of the U.S. lending mechanism was frozen and continued to be frozen into June 2009.[133] According to the Brookings Institution, the traditional banking system does not have the capital to close this gap as of June 2009:

Sony VAIO PCG-5P1M Battery “It would take a number of years of strong profits to generate sufficient capital to support that additional lending volume.” The authors also indicate that some forms of securitization are “likely to vanish forever, having been an artifact of excessively loose credit conditions.”

 

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While traditional banks have raised their lending standards, it was the collapse of the shadow banking system that is the primary cause of the reduction in funds available for borrowing.[184]

 

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Wealth effects

 

 

The New York City headquarters of Lehman Brothers

There is a direct relationship between declines in wealth, and declines in consumption and business investment, which along with government spending represent the economic engine. Between June 2007 and November 2008,

Sony VAIO PCG-8161M BatteryAmericans lost an estimated average of more than a quarter of their collective net worth.[citation needed] By early November 2008, a broad U.S. stock index the S&P 500, was down 45% from its 2007 high.

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Housing prices had dropped 20% from their 2006 peak, with futures markets signaling a 30–35% potential drop. Total home equity in the United States, which was valued at $13 trillion at its peak in 2006, had dropped to $8.8 trillion by mid-2008 and was still falling in late 2008. Total retirement assets, Americans’ second-largest household asset, dropped by 22%, from $10.3 trillion in 2006 to $8 trillion in mid-2008

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During the same period, savings and investment assets (apart from retirement savings) lost $1.2 trillion and pension assets lost $1.3 trillion. Taken together, these losses total a staggering $8.3 trillion.[185] Since peaking in the second quarter of 2007, household wealth is down $14 trillion.[186] Sony VAIO PCG-3F1M Battery

 

 

Further, U.S. homeowners had extracted significant equity in their homes in the years leading up to the crisis, which they could no longer do once housing prices collapsed. Free cash used by consumers from home equity extraction doubled from $627 billion in 2001 to $1,428 billion in 2005 as the housing bubble built, Sony VAIO PCG-3H1M Battery

a total of nearly $5 trillion over the period.[106][107][108] U.S. home mortgage debt relative to GDP increased from an average of 46% during the 1990s to 73% during 2008, reaching $10.5 trillion.[109]

 

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To offset this decline in consumption and lending capacity, the U.S. government and U.S. Federal Reserve have committed $13.9 trillion, of which $6.8 trillion has been invested or spent, as of June 2009.[187] In effect, the Fed has gone from being the “lender of last resort” to the “lender of only resort” for a significant portion of the economy. In some cases the Fed can now be considered the “buyer of last resort”.Sony VAIO PCG-8152M Battery

 

 

Economist Dean Baker explained the reduction in the availability of credit this way:

 

Yes, consumers and businesses can’t get credit as easily as they could a year ago. There is a really good reason for tighter credit. Tens of millions of homeowners who had substantial equity in their homes two years ago have little or nothing today. Businesses are facing the worst downturn since the Great Depression.

Sony VAIO PCG-71312M Battery This matters for credit decisions. A homeowner with equity in her home is very unlikely to default on a car loan or credit card debt. They will draw on this equity rather than lose their car and/or have a default placed on their credit record. On the other hand, a homeowner who has no equity is a serious default risk. Sony VAIO PCG-9Z1M Battery

 

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In the case of businesses, their creditworthiness depends on their future profits. Profit prospects look much worse in November 2008 than they did in November 2007 (of course, to clear-eyed analysts, they didn’t look too good a year ago either). Sony VAIO PCG-3B1M Battery

While many banks are obviously at the brink, consumers and businesses would be facing a much harder time getting credit right now even if the financial system were rock solid. The problem with the economy is the loss of close to $6 trillion in housing wealth and an even larger amount of stock wealth.

 

Sony VAIO PCG-41112M Battery Economists, economic policy makers and economic reporters virtually all missed the housing bubble on the way up. If they still can’t notice its impact as the collapse of the bubble throws into the worst recession in the post-war era, then they are in the wrong profession.[188]

 

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At the heart of the portfolios of many of these institutions were investments whose assets had been derived from bundled home mortgages. Exposure to these mortgage-backed securities, or to the credit derivatives used to insure them against failure, caused the collapse or takeover of several key firms such as Lehman Brothers, AIG, Merrill Lynch, and HBOS.[

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European contagion

The crisis rapidly developed and spread into a global economic shock, resulting in a number of European bank failures, declines in various stock indexes, and large reductions in the market value of equities[192] and commodities.[193]

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Both MBS and CDO were purchased by corporate and institutional investors globally. Derivatives such as credit default swaps also increased the linkage between large financial institutions. Moreover, the de-leveraging of financial institutions,

 

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as assets were sold to pay back obligations that could not be refinanced in frozen credit markets, further accelerated the solvency crisis and caused a decrease in international trade.

 

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World political leaders, national ministers of finance and central bank directors coordinated their efforts[194] to reduce fears, but the crisis continued. At the end of October 2008 a currency crisis developed,

 

Sony VAIO PCG-7141M Batterywith investors transferring vast capital resources into stronger currencies such as the yen, the dollar and the Swiss franc, leading many emergent economies to seek aid from the International Monetary Fund.[195][196]

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Effects on the global economy

 

Main article: 2008–2012 global recession

Global effects

A number of commentators have suggested that if the liquidity crisis continues, there could be an extended recession or worse.[197] The continuing development of the crisis has prompted in some quarters fears of a global economic collapse although there are now many cautiously optimistic forecasters in addition to some prominent sources who remain negative.[1

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98] The financial crisis is likely to yield the biggest banking shakeout since the savings-and-loan meltdown.[199] Investment bank UBS stated on October 6 that 2008 would see a clear global recession, with recovery unlikely for at least two years.[20Sony VAIO PCG-3C1T Battery

Sony VAIO PCG-3D1M Battery 0] Three days later UBS economists announced that the “beginning of the end” of the crisis had begun, with the world starting to make the necessary actions to fix the crisis: capital injection by governments;

 

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injection made systemically; interest rate cuts to help borrowers. The United Kingdom had started systemic injection, and the world’s central banks were now cutting interest rates. UBS emphasized the United States needed to implement systemic injection. UBS further emphasized that this fixes only the financial crisis, but that in economic terms “the worst is still to come”.

 

Sony VGP-BPS26A Battery [201] UBS quantified their expected recession durations on October 16: the Eurozone’s would last two quarters, the United States’ would last three quarters, and the United Kingdom’s would last four quarters.[202] The economic crisis in Iceland involved all three of the country’s major banks. Relative to the size of its economy, Iceland’s banking collapse is the largest suffered by any country in economic history.[203]

 

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At the end of October UBS revised its outlook downwards: the forthcoming recession would be the worst since the early 1980s recession with negative 2009 growth for the U.S., Eurozone, UK; very limited recovery in 2010; but not as bad as the Great Depression.[204]

 

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The Brookings Institution reported in June 2009 that U.S. consumption accounted for more than a third of the growth in global consumption between 2000 and 2007. “The US economy has been spending too much and borrowing too much for years and the rest of the world depended on the U.S. consumer as a source of global demand.”

 

Sony VGP-BPS22A Battery With a recession in the U.S. and the increased savings rate of U.S. consumers, declines in growth elsewhere have been dramatic. For the first quarter of 2009, the annualized rate of decline in GDP was 14.4% in Germany, 15.2% in Japan, 7.4% in the UK, 18% in Latvia,[205] 9.8% in the Euro area and 21.5% for Mexico.[206]

 

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Some developing countries that had seen strong economic growth saw significant slowdowns. For example, growth forecasts in Cambodia show a fall from more than 10% in 2007 to close to zero in 2009,

 

Sony PCG-91111M Batteryand Kenya may achieve only 3–4% growth in 2009, down from 7% in 2007. According to the research by the Overseas Development Institute, reductions in growth can be attributed to falls in trade, commodity prices, investment and remittances sent from migrant workers (which reached a record $251 billion in 2007,

 

Sony PCG-61713M Battery but have fallen in many countries since).[207] This has stark implications and has led to a dramatic rise in the number of households living below the poverty line, be it 300,000 in Bangladesh or 230,000 in Ghana.[207]

 

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The World Bank reported in February 2009 that the Arab World was far less severely affected by the credit crunch. With generally good balance of payments positions coming into the crisis or with alternative sources of financing for their large current account deficits, such as remittances, Foreign Direct Investment (FDI) or foreign aid, Arab countries were able to avoid going to the market in the latter part of 2008.

 

Sony PCG-91211M BatteryThis group is in the best position to absorb the economic shocks. They entered the crisis in exceptionally strong positions. This gives them a significant cushion against the global downturn. The greatest impact of the global economic crisis will come in the form of lower oil prices,

 

Sony PCG-71811M Batterywhich remains the single most important determinant of economic performance. Steadily declining oil prices would force them to draw down reserves and cut down on investments. Significantly lower oil prices could cause a reversal of economic performance as has been the case in past oil shocks. Initial impact will be seen on public finances and employment for foreign workers.[208]

 

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U.S. economic effects

Real gross domestic product

The output of goods and services produced by labor and property located in the United States—decreased at an annual rate of approximately 6% in the fourth quarter of 2008 and first quarter of 2009,

 

Sony PCG-71911M Batteryversus activity in the year-ago periods.[209] The U.S. unemployment rate increased to 10.1% by October 2009, the highest rate since 1983 and roughly twice the pre-crisis rate. The average hours per work week declined to 33, the lowest level since the government began collecting the data in 1964.[210][211]

 

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Distribution of wealth

 

 

U.S. inequality from 1913–2008.

The very rich lost relatively less in the crisis than the remainder of the population, widening the wealth gap between the economic class at the very top of the demographic pyramid and everyone else beneath them. Thus the top 1% who owned 34.6% of the nation’s wealth in 2007 increased their proportional share to over 37.1% by 2009.[212][213]

 

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Typical American families did not fare as well, nor did those “wealthy-but-not wealthiest” families just beneath the pyramid’s top. On the other hand, half of the poorest families did not have wealth declines at all during the crisis.
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Sony PCG-71213M Battery The Federal Reserve surveyed 4,000 households between 2007 and 2009, and found that the total wealth of 63 percent of all Americans declined in that period. 77 percent of the richest families had a decrease in total wealth, while only 50 percent of those on the bottom of the pyramid suffered a decrease.[214]

 

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Official economic projections

On November 3, 2008, the European Commission at Brussels predicted for 2009 an extremely weak growth of GDP, by 0.1%, for the countries of the Eurozone (France, Germany, Italy, Belgium etc.) and even negative number for the UK (−1.0%),Sony Vaio VGN-NR31E/S Battery

 

Sony Vaio VGN-NR38Z/T Battery Ireland and Spain. On November 6, the IMF at Washington, D.C., launched numbers predicting a worldwide recession by −0.3% for 2009, averaged over the developed economies. On the same day, the Bank of England and the European Central Bank, respectively, reduced their interest rates from 4.5% down to 3%, and from 3.75% down to 3.25%. As a consequence, starting from November 2008, several countries launched large “help packages” for their economies. Sony Vaio VGN-NR31ER/S Battery