Article Title and Date of the Article .docx

Article
Title
and
Date
of
the
Article
The
Economist
“Insider
dealing:
euro
outs
fear
that
euro
ins
might
do
them
down”
October
17,
2015

Summary
This
article
posted
as
a
special
news
report
by
The
Economist,
is
focused
on
the
Eurozone
and
European
Union,

and
how
they
are
experiencing
some
problems
that
might
hurt
both
the
euro
currency
and
relations
with
non-‐-‐-‐euro
zone
countries.
At
the
moment,
in
Europe
there
are
two
types
of
observers:
the
Europhiles
and

Euroskeptics.
The
Europhiles
are
those
who
admire
Europe
and
favor
the
participation
of
the
European
Union,
while
on
the
other
side
of
the
spectrum
are
the
Euroskeptics,
who
are
those
who
are
opposed

to
increasing
the
powers
of
the
European
Union.
Currently,
the
alarming
political
issue
that
has
been
growing
in
Europe
is
the
negative
relationship
between
those

countries
that
belong
to
the
European
Union
and
Eurozone,
against
those
who
are
members
of
the
European
Union
but
not
the
Eurozone.
The
argument
here
is
that
those
members
belonging
to
the
Eurozone

have
been
meeting
together,
while
excluding
non-‐-‐-‐Eurozone
members
and
making
decisions
such
as
bails,
which
affect
all
countries
within
the
European
Union.
The
Eurozone
countries
believe
that
that
only
those
countries
that
are
members

of
the
Eurozone
should
be
allowed
to
voice
their
opinions
and
make
decisions
on
everything
regarding
the
euro,
since
they
are
the
ones
directly
affected
by
it.
On
the
other
hand,
the

non-‐-‐-‐Eurozone
countries
feel
like
the
euro
members
are
“ganging
up”
on
them,
meaning
that
they
feel
like
those
countries
in
the
Eurozone
are
making
decisions
regarding
their
own
interests,
and
not
the
collective
interests

of
all
members
of
the
European
Union.
Association
to
specific
chapter
material
and
concepts
2.4
A
Single
Currency
for
Europe:

The
Euro
(40)
Chapter
2
discusses
the
global
financial
environment
including
the
European
Union,
the
Eurozone
and
the
impact
of
the
Euro
in
the
markets.
10.1
Types
of
Foreign
Exchange

Exposure
(272)
Chapter
10
introduces
the
various
types
of
exposure
to
foreign
currency
fluctuations
That
firms
face.
Political
problems
as
those
seen
from
the
article
can
cause
major
currency
fluctuations
in

the
euro
exchange,
which
is
a
concern
for
companies
conducting
international
business
using
euros.
Concepts
Euro

–
A
single
new
currency
unit
adopted
by
the
11
participating
members
of
the
European
Union’s
European
Monetary
System
in
January
1999,
replacing
their
individual
currencies.
European
Union
–
The
official

name
of
the
former
European
Economic
Community
as
of
January
1,
1994.
Eurozone
–
The
countries
that
officially
use
the
euro
as
their
currency.
Translation
exposure
–
measures
changes

in
the
value
of
outstanding
financial
obligations
incurred
prior
to
a
change
in
exchange
rates
but
not
due
to
be
settled
until
after
the
exchange
rates
change.
Thus,
it
deals
with
changes
in
cash

flows
that
result
from
existing
contractual
obligations.
Translation
exposure
–
is
the
potential
for
accounting-‐derived
changes
in
owner's
equity
to
occur
because
of
the
need
to
“translate”
foreign
currency
financial

statements
of
foreign
subsidiaries
into
a
single
reporting
currency
to
prepare
worldwide
consolidated
financial
statements.
Operating
exposure
–
also
called
economic
exposure,
competitive
exposure,
or
strategic
exposure,
measures
the
change
in

the
present
value
of
the
firm
resulting
from
any
change
in
future
operating
cash
flows
of
the
firm
caused
by
an
unexpected
change
in
exchange
rates.
The
change
in
value
depends
on
the
effect

of
the
exchange
rate
change
on
future
sales
volume,
prices,
and
costs.
Currency
risk
–
is
the
variance
in
expected
cash
flows
arising
from
unexpected
exchange
rate
changes.

Reasons
for
selection
The
reason
I
chose
this
article
is
because
it
demonstrates
how
countries
have
to
work
together
for
an
improved
global
environment.
If
they

do
not,
they
will
experience
greater
problems
in
their
economies,
businesses,
and
investments
both
in
the
domestic
and
global
markets.
Additionally,
chapters
10-‐-‐-‐18
cover
extensively
“foreign
exchange
risk
management”
and
this
article
is

a
perfect
example
in
which
we
can
see
the
concepts
we
learn
in
class,
be
applied
in
the
real
world.
The
issues
discussed
in
the
article
have
caused
greater
currency
exposure

in
the
global
markets.
Basically,
the
euro
currency
is
suffering
as
foreign
investors
begin
doubting
its
stability,
and
start
regarding
it
as
a
riskier
currency
than
it
was
before.
In
addition
to
this,

many
businesses
and
investors
in
the
European
Union
have
been
experiencing
losses
from
the
low
euro
currency
values
in
recent
times.
Important
points
or
lessons

learned
from
this
article
An
important
point
that
the
article
makes
is
that
even
though
there
are
many
issues
at
the
moment
between
Euro
countries
and
non-‐-‐-‐Euro
countries,
one
thing

that
both
opposing
sides
(the
Europhiles
and
Euroskeptics)
can
both
agree
on
is
that
if
the
euro
zone
does
survive,
it
would
have
to
make
arrangements
for
a
stronger
political
integration,
bail-‐-‐-‐out
fund,
an

establishment
of
a
central
bank
that
acts
as
a
lender
of
last
resort,
and
an
improved
and
proper
banking
union.
The
most
important
lesson
to
take
away
from
this
article
is

the
fact
that
we
can
apply
some
of
the
concepts
learned
in
International
Financial
Management
such
as
how
exchange
risks
and
exposures
can
be
linked
to
the
economic
and
political
situations
of
countries.

We
can
clearly
see
it
portrayed
in
this
article
that
speaks
about
the
political
and
financial
management
issues
that
countries
in
the
European
Union
should
try
to
solve
in
order
to
succeed.

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