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<strong>XML</strong> – EXtensible Markup Language. Common Record: CommonLine (CR:C) files are XML files.

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<strong>Discharge</strong> – The release of a borrower or any comaker from all or a portion of his or her loan obligation. Valid reasons for discharge include school closure, death, total and permanent disability, an unpaid refund by the school, or the school' s false certification of a FFEL Program loan.
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<strong>DHE</strong> – Department of Higher Education, the Missouri state agency overseeing the state' s higher education systems and related policies and administering student aid programs, including the FFEL Program and state aid programs such as the Bright Flight Scholarship. Also known as the MDHE. The agency' s website may be found at www.dhe.mo.gov.
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fiscal crisis (H2, H3)<br />A shortage in the tax revenues needed to finance a desired level of public expenditure. Marxists and others have asserted that there is a built-in tendency for modem fiscal systems to head for crisis as the increasing demands for EGALITARIANISM and more public services are not matched by a desire to pay more taxation. A concern for the disincentive and allocative effects of higher rates of tax makes it difficult to raise extra tax revenue, making a fiscal crisis incurable.
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Organization of Petroleum Exporting Countries (FO, Q4)<br />The major world oil producers' forum established by the Baghdad Conference of 1960, on the initiative of Venezuela. It has aimed to restore oil prices to their pre-September 1960 levels, to keep oil companies' prices stable and to oblige countries not to agree to increase production if another country failed to reach an agreement with an oil company. The five founder members - Iraq, Iran, Kuwait, Saudi Arabia and Venezuela - were joined by Qatar in 1961, Libya and Indonesia in 1962, Abu Dhabi in 1967, Algeria in 1969, Nigeria in 1971, Ecuador in 1973 and Gabon in 1975. Its affairs were conducted in six-monthly regular and further extraordinary meetings. Following years of turbulent negotiations with oil companies that failed to raise the incomes of the oil countries as much as they desired, the six Gulf oil producers in October 1973 unilaterally increased their oil price by 70 per cent and cut production by 5 per cent; in December 1973, there was a further price increase of 13 per cent. OPEC was able to agree on common prices and quotas until dual pricing was introduced in 1976. Thus frustration with the oil companies made OPEC assume the role of price fixing. However, the 1981 price increase was too great: Saudi Arabia dissented from the subsequent cut, leading to a price war and the weakening of the joint power of OPEC.<br /><em>See also:</em> oil-price increases <br /><em>Reference</em><br />Ghanem, S. (1986) OPEC: The Rise and Fall of an Exclusive Club, London: KPL
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paper money (E4)<br />BANKNOTES generally acceptable in payment of a debt. Originally this paper derived its status from being convertible into gold or silver because of their intrinsic value. Since 1931, banknotes have usually been inconvertible so paper money can act as a MEDIUM oF EXCHANGE because of the financially sound character of the banking system issuing it. The status of paper money is recognized by making it 'LEGALTENDER'.<br /><em>See also:</em> Banking School; gold standard; Thornton
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capitalization (Gl)<br />The conversion of an interest payment or a liquid asset into permanent capitaL A company can capitalize its cash reserves by the issue of shares (a free, BONUS or scRIP ISSUE). A debtor, even a nation, can capitalize interest payments by adding them to the original sum borrowed.<br /><em>See also:</em> securitization

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current operating profit (M2)<br />The current value of output sold over a period, less the current cost of related inputs.

<strong>E-sign</strong> – Process of electronically “signing” a FFEL Program loan application, FAFSA, or other student aid document by providing information in an electronic format such as within a web loan delivery product (e.g., the MDHE-ASA product, MODEL Direct).
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Regulation Q (E4, E5)<br />The ceiling to the rate of interest US COMMERCIAL BANKS could pay on deposits of less than thirty days' maturity in the period 1933-85. This maximum rate was fixed from time to time by the US FEDERAL RESERVE SYSTEM. One of the aims of the regulation was to reduce the cost of housing finance as THRIFTS would be able to operate with low interest rates. As the regulation was evaded by bankers borrowing abroad to replace domestic deposits, the growth of the EURODOLLAR market was encouraged and much ms!NTERMED!AT!ON occurred. In 1980, it was decided to phase out the regulation over a five-year period.

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Bergson, Abram, 1914- (B3)<br />US economist educated at Johns Hopkins and Harvard Universities. After wartime experience from 1942 to 1945 as chief of the Russian Economic Subdivision of the US Office of Strategic Services, he returned to academic life and has been a professor at Harvard since 1956. In 1938, he created the new welfare economics by asserting that a social welfare function can be established by attaching weights to each individual's welfare function: this rejected the earlier CARDINAL UTILITY approach. Also, he introduced the distinction between 'efficiency' and 'equity', applying it to an analysis of the individual income effects of economic change. He has applied his welfare analysis to many areas of economics, including MARKET sociALISM and monopoly. Also, he became a leading US authority on the Soviet economy.<br /> <br /><em>Reference</em><br />Bergson, A. (1964) Economics of Soviet Planning, New Haven, CT: Yale University Press. - (1966) Essays in Normative Economics, Cambridge, :MA: Harvard University Press.<br /> - (1982) Welfare Planning and Employment: Selected Essays in Economic Theory, Cambridge, MA: MIT Press.
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<strong>Less than half time (LTH)</strong> – An enrollment status indicating the student is carrying less than a half-time academic workload, as determined by the school. Students who are less than half time are not eligible to borrow FFEL Program loans.
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<strong>Holder</strong> – An eligible lender that owns a FFEL Program loan.
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<strong>NDSL</strong> – National Direct Student Loan, renamed the Federal Perkins Loan Program in 1992. (Note: this is NOT the same program as the William D. Ford Direct Loan Program, or FDLP.)
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Variable observed multinational corporation (F2, L2)<br />An international firm that produces goods or services in several countries, without being concentrated in a single country, Although the term first became popular in the 1960s, by the late nineteenth century several US, UK and Dutch firms had acquired such characteristics.<br /> The advantages of production abroad, rather than exporting from the original country of operation, include a saving in transport costs, the adjustment of product design to make products more acceptable to local markets, a reduction, in many cases, in corporate taxation and access to local labour and capital which may be more abundant than at home. The immense success of this form of organization, prominent in many industries, including motor cars, computers, pharmaceuticals, food processing, oil and soap, has attracted envy and criticism: envy from national governments with less economic power and competence; criticism from Marxists who see the growth of multinationals as a sinister international expansion of CAPITALISM. TRADE UNIONS complain about competition from cheap labour countries; science graduates lament the increased concentration of research and development activities in the USA to the detriment of other countries; national governments object to the loss of tax revenue and the difficulties of operating
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sample (C1)<br />A part of a POPULATION which is examined in order to ascertain the characteristics of the whole of that population. Random sampling (or probability sampling) is used to obtain unbiased estimates. Sampling can produce better evaluations by increasing the size of a sample or by stratification of the sampled population.<br /><em>Reference</em><br />Kish, L. (1965) Survey Sampling, New York: Wiley.
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<strong>Servicer</strong> – An entity that enters into a contract with a program participant to administer any aspect of its participation in a Title IV program. Schools, lenders, secondary markets, guarantors, and the federal government may all employ servicers. MOHELA, Nelnet, and Sallie Mae are all FFEL Program servicers operating in the state of Missouri.
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<strong>Web loan delivery product</strong> – An online system that allows schools, borrowers, and/or lenders to inquire on loans or borrowers, submit change transactions, manage files, and guarantee new loans via the internet. The MDHE' s product is called MODEL Direct.
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hard ecu (F3)<br />A version of the ecu proposed by the UK initially as a COMMON CURRENCY to be used in the EUROPEAN COMMUNITY for all monetary transactions alongside existing national currencies. The hope was that this ecu would become a single currency.
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<strong>Alternative loan</strong> – A non federal student loan, also referred to as “private loan.” Alternative loans are offered to students and/or parents by many, many lenders, secondary markets, and other private entities. The loan type code used in CommonLine to identify an alternative loan is AL.
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08-03-2011 10:34 PM

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co-operative federalism (H7)<br />A federal state with much intergovernmental co-operation between federal and state governments. In particular, the different layers of government jointly participate in many programmes.<br /><em>See also:</em> dual federalism; fiscal federalism
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information trap (D4)<br />An equilibrium state in which prices fail to reveal all the information in the market. Mistaken beliefs about the information possessed by other market participants produce this trap.
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<strong>Write-off</strong> – A loan amount for which there has been a total cessation of collection activity.
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<strong>OFee</strong> – Origination Fee, a fee charged to offset the federal government' s cost of interest subsidies (for subsidized Federal Stafford Loans) and reinsurance payments for loans that either default or are eligible for forgiveness or discharge. This fee, if charged to the borrower, may be subtracted from the borrower' s loan proceeds at the time of disbursement.

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chaebol (LO, M1)<br />Korean group of giant companies controlled by a family-owned holding company.<br /> See also: zaibatsu

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08-03-2011 11:21 PM

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liquid market (G1)<br />A market where buying and selling are easy and low cost with the consequence that prices tend to their underlying values.

Miller, Merton, 1923-2000 (B3)<br />Educated at Harvard and Johns Hopkins Universities and professor at the University of Chicago from 1981. Along with MODIGLIANI, from 1958 he established that in corporate finance a firm's value is determined by its investment decisions, not its dividend policy. His interests broadened to include the regulation of financial services through his directorships of the Chicago Board of Trade and Chicago Mercantile Exchange. In 1990, he shared the NOBEL PRIZE FOR ECONOMICS with MARKOVITZ and SHARPE for pioneering work in the theory of financial economics.

<strong>Principal balance</strong> – The outstanding amount of a loan, on which the lender charges interest.

<strong>GP</strong> – Guarantee and Print, a type of application process flow within the FFEL Program and outlined in CommonLine file specifications. In a “GP” process flow, the school submits loan application information to the guarantor for guarantee. After the loan is guaranteed, either a paper MPN is mailed to the borrower for completion or the application is made available online for the borrower to complete and sign.

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<strong>Financial aid package</strong> – The total amount of financial aid that a school awards a student for any given aid year. Also referred to as “financial aid award.”

<strong>FY</strong> – Fiscal Year, an annual budgetary period. A fiscal year may defined as a calendar year or other period, such as a State Fiscal Year (July 1-June 30) or Federal Fiscal Year (October 1– September 30).

base currency (F3)<br />The CURRENCY used to quantify a RISK.

last-in, first-out (J2, M2)<br />1 A principle for the rotation of inventories/physical stocks. In UK NATIONAL INCOME accounting conventions it enables all items to be valued at current prices; a firm using this principle is able to finance the replacement of stocks in inflationary periods.<br /> 2 The employment policy of firms which lay off first the workers who have been recruited most recently.<br /><em>See also:</em> first-in, first-out
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<strong>LTH</strong> – Less than half time, an enrollment status indicating the student is carrying less than a half-time academic workload, as determined by the school. Students who are less than half time are not eligible to borrow FFEL Program loans.

<strong>Coordinating Board for Higher Education (CBHE)</strong> – The governing body overseeing the Missouri Department of Higher Education. The CBHE is comprised of 9 board members and meets 5 times each year.
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pure public good (H4)<br />A good or service which is both nonexcludable and non-exhaustible.
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<strong>ELM-NDN</strong> – ELM' s National Disbursing Network (NDN), which provides consolidated disbursement services to schools.

industry (LO)<br />A group of firms producing the same principal product. In a broad classification of industries, all industrial activity of an economy can be divided into only ten or a hundred industries but narrower classifications make possible a division into as many as a thousand or more. Types of industry are contrasted as HEAVY or LIGHT, mature or high-tech, smokestack or sunrise.<br /><em>See also:</em> Standard Industrial Classification; three-digit industry; two-digit industry

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discrimination (J7)<br />1 Unfair and unfavourable treatment of a group of workers or other persons.<br /> 2 Setting different wages for workers with the same productivity but different personal characteristics, i.e. ######, age or race, or refusing to hire them.
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<strong>Default Fee</strong> – A loan program fee required by the Deficit Reduction Act of 2005 to offset the risk of default and its subsequent costs. All Stafford and PLUS Loans guaranteed on or after July 1, 2006 must be assessed a one percent default fee. The fee either must be deducted from the borrower' s loan proceeds at the time of disbursement or paid by a third party from other non– federal sources (such as a lender or servicer). Also referred to as DFee and/or FDF.

<strong>EFC</strong> – Expected Family Contribution, the amount the student or student' s family is expected to pay toward the student' s cost of attendance as a result of the Federal Need Analysis Methodology.
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08-04-2011 01:55 AM

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<strong>State tax offset</strong> – The withholding of a borrower' s state income tax refund to repay a defaulted loan.
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Lombard rate (E4)<br />The rate of interest usually 112 per cent above the discount rate charged by the BUNDESBANK when acting in its capacity as LENDER OF LAST RESORT. Banks can borrow for up to three months against the collateral of certain high-quality securities, which include treasury bills and federal bonds.
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primary employment (EO) see employment multiplier

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self-regulatory organization (K2, L5)<br />An organization set up by a profession or group of specialist financial traders to regulate the conduct of its members instead of being subject to direct governmental controL In the UK, examples of these organizations include LLOYD'S, the SECURITIES AssociATION, AFBD, Fimbra, IMRO and LAUTRO.<br /><em>See also:</em> Financial Services Act; regulation

contract compliance (HO, J7)<br />Obeying the terms and conditions of governmental contracts awarded to private sector firms. This approach has often been used, especially in the USA, as a means of advancing employment policies, e.g. the employment of women, blacks and disabled persons.<br /><em>See also:</em> Fair Wages Resolution
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<strong>Variable rate</strong> – An interest rate that varies over time and generally has a specified maximum (cap). Prior to July 1, 2006, interest rates on FFEL Program loans were variable with an 8.25% cap. (Beginning July 1, 2006, interest rates are now fixed rates, with the maximum established at 6.8% for Stafford Loans and 8.5% for FFEL Program PLUS Loans.)

<strong>NAICU</strong> – National Association of Independent Colleges and Universities.

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08-04-2011 02:46 AM

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basing point pricing (L2)<br />A system of uniform pricing which includes a transport charge for delivery from an arbitrarily chosen geographical base. In the USA, it was first used to sell steel at Pittsburgh prices plus freight charges from Pittsburgh to consumers (hence the name 'Pittsburgh-Plus' for the system). The system has also been used in Europe, including the UK cement industry. ANTITRUST and COMPETITION POLICIES have long condemned this departure from price competition. This practice distorts the location choices of firms as they are charged less than actual freight charges in some places but in others have to pay for phantom journeys.<br /><em>See also:</em> Robinson-Patman Act 1936
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development planning (02)<br />The USe of CENTRAL PLANNING in Third World countries as a route to economic development. The earliest plans were carried out before and after the Second World War in British, French, Belgian and Portuguese colonies. These plans included a crash investment programme, especially in the public sector, and a commitment to rapid industrialization.

<strong>Economic hardship</strong> – A period during which the borrower is working full time but is earning an amount that does not exceed the greater of the minimum wage or the poverty line for a family of two. Economic hardship also exists if a borrower' s monthly payments on federal student loans are equal to or greater than 20 percent of his/her monthly income.

baby-boom period (Jl)<br />The 1970s when persons who were born in the high-birth-rate period following the Second World War became adults.

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08-04-2011 03:08 AM

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dollar overhang (F3)<br />US dollars held outside the USA in the 1960s in excess of the gold backing for them.<br /><em>See also:</em> monetary overhang
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loan stock (G1)<br />A stock exchange security with a fixed rate of interest and, usually, prior entitlement to payment out of any available earnings.<br /><em>See also:</em> debenture

<strong>E-sign</strong> – Process of electronically “signing” a FFEL Program loan application, FAFSA, or other student aid document by providing information in an electronic format such as within a web loan delivery product (e.g., the MDHE-ASA product, MODEL Direct).
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tants particularly possess this capital. Part of remuneration, especially to older members of staff, can be considered a return to relational capital. Unlike most types of human capital, it is transferable.
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<strong>Financial Aid Administrator (FAA)</strong> – A staff member at an eligible school who administers financial aid programs.

private sector liquidity (UK) (E4)<br />This broad measure of the money supply was much used in the 1980s and took two forms:
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Sherman Act 1890 (L4)<br />The founding statute of the US federal ANTITRUST legislation. This Act prohibits 'all contracts, combinations and conspiracies in restraint of trade' (section 1) and monopolization in interstate and foreign trade (section 2). The Act was followed by further federal legislation and similar statutes for individual states.<br /><em>See also:</em> antitrust; Celler-Kefauver Antimerger Act; Clayton Act; Federal Trade Commission Act; Robinson-Patman Act <br /><em>Reference</em><br />Bork, R.H. (1978) The Antitrust Paradox, New York: Basic Books.

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mode (C1)<br />The value of a set of numberswhich most frequently occurs, e.g. 7 is the mode of 2, 3, 3, 4, 5, 6, 6, 7, 7, 7, 11, 11. Some distributions are without modes_<br /><em>See also:</em> mean; median; unimodal distribution
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Mundeii-Fieming model (E1)<br />An open economy model extending the IS-LM model on which an FF curve is imposed to show that the economy is in equilibrium when there are equilibria in its money and goods markets and its imports equal its exports. The TERMS oF TRADE affect the positions of both the IS and FF curves.<br /><em>See also:</em> IS-LM curves <br /><em>Reference</em><br />Mundell, R.A. (1968) International Economics, New York: Macmillan.
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capital re-switching (D2)<br />A return to more CAPITAL-INTENSIVE methods of production because a technique has become more profitable through an increase in the marginal product of capital or a fall in the rate of interest.<br /><em>See also:</em> Cambridge controversies

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<strong>Mapping Your Future (MYF) Online Stafford Exit Counseling Leaflet</strong> – A guide to completing student loan exit counseling online through Mapping Your Future, This publication and all publications published by the MDHE can be requested on the Publications Order Form: http://www.dhe.mo.gov/publicationsorderform.shtml
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<strong>Encryption</strong> – A process by which data is translated into a proprietary code (algorithm) so that it can only be read or altered by an entity that possesses the keys to decipher (decrypt) the code. There are two types of encryption: symmetric (private key) and asymmetric (public key).
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