The eNotes Blog Nothing good gets away Advice from John Steinbeck onLove

No good thing escapes Advice from John Steinbeck onLove John Steinbeck revered his two children, Thom, the oldest, and John (better known by his moniker, Catbird).  After a wild separation with his subsequent spouse, Gwyn, the mother of the young men, and a long and typically cherishing marriage yet in addition troublesome relationship with his first wife, Carol, Steinbeck had discovered genuine romance with his third wife, Elaine. The two were hitched until his passing, from 1949 to 1968. My thesis is on Steinbeck and in my examination, I have gone through months scrutinizing his tremendous assortment of individual letters, the greater part of which are housed in the Special Collections at Stanford University. Notwithstanding the taught every day organization of his books, Steinbeck regularly composed six to eight letters per day: to companions, family, and associates. Nearly everybody kept the letters. I became more acquainted with the connection among Steinbeck and his children very well through those letters. He was a brilliant dad. At the point when he saw voyaging could offer his young men superior training than conventional tutoring, he took Thom and Catbird with him and Elaine to Europe and somewhere else. Their guide was the youthful writer, Terrance McNally. Here is a letter that fourteen-year-old Thom got from his father, before those voyaging years, when Thom was at life experience school in Connecticut and was simply starting to be keen on young ladies.  It has been broadly distributed previously, yet it is such an excellent thingeveryone should understand it. Dear Thom: We had your letter at the beginning of today. I will answer it from my perspective and obviously Elaine will from hers. First - on the off chance that you are infatuated - that’s something worth being thankful for - that’s about the best thing that can transpire. Don’t let anybody make it little or light to you. Second - There are a few sorts of affection. One is a narrow minded, mean, getting a handle on, vain thing which uses love for pretentiousness. This is the monstrous and devastating kind. The other is an overflowing of everything great in you - of benevolence and thought and regard - the social regard of habits as well as the more noteworthy regard which is acknowledgment of someone else as one of a kind and important. The principal kind can make you debilitated and little and powerless however the second can discharge in you quality, and mental fortitude and goodness and even shrewdness you didn’t realize you had. You state this isn't infatuation. In the event that you feel so profoundly - obviously it isn’t infatuation. In any case, I don’t think you were asking me what you feel. You know superior to anybody. What you needed me to assist you with is some solution for it - and that I can let you know. Magnificence in it for a certain something and be extremely happy and appreciative for it. The object of adoration is the best and generally wonderful. Attempt to satisfy it. In the event that you love somebody - there is no conceivable mischief in saying as much - just you should recall that a few people are exceptionally timid and now and then the expression must think about that bashfulness. Young ladies have a method of knowing or feeling what you feel, yet they generally prefer to hear it too. It once in a while happens that what you feel isn't returned for some explanation - yet that doesn't make your inclination less significant and great. In conclusion, I know your inclination since I have it and I’m happy you have it. We will be happy to meet Susan. She will be extremely welcome. In any case, Elaine will make every single such course of action since that is her territory and she will be exceptionally happy to. She thinks about affection as well and perhaps she can give you more assistance than I can. What's more, don’t stress over losing. On the off chance that it is correct, it occurs - The primary concern isn't to hustle. No good thing escapes. Love, Fa There are numerous things I love about the letter: he is to expect a reaction from Elaine, as a womans perspective will likewise be useful; that he is insightful enough to know to not excuse Thoms emotions, since he is youthful; that he can let him know in language a kid of that age can comprehend, and truly, talks doubtlessly to anybody of all ages, about the sorts of adoration.  There isn't only one kind; some are negative and dangerous, some are sure and productive. Also, in shutting, he remembers the object of Thoms love. He recognizes her by name and invites her. Here is an ongoing picture of Thom Steinbeck, who, similar to his dad, additionally turned into an author (The Silver Lotus, Down to a Soundless Sea)â and favors John from multiple points of view.

wordsworth Essays - British Poetry, I Wandered Lonely As A Cloud

One day the speaker is purposelessly strolling around like a cloud in the sky with no reason however to glide around. He happens to unearth a wonderful field that is loaded up with daffodils that is close by a lake. He says that the blossoms are moving and moving so that enamors him. The lake moves in a heavenly manner that makes him simply stop and gaze. Both the lake and the blossoms move such that is so consistent he can?t take his eyes off it. The lake is lovely however the blossoms look so upbeat. He accepts that an artist couldn?t yet be inebriated in the organization of the blossoms. He didn?t imagine that the blossoms would be such a fortune, that he would save for quite a while. That at whatever point he felt like a no-limit pit and his life was turning out badly he could simply recollect the blossoms and everything would be OK. He represents when he was erratically strolling around in a field like a solitary cloud in the sky that resembles and outsider. ?I meandered forlorn as a cloud that drifts on high o'er vales and slopes? (Wordsworth). At that point out of the blue he sees a field of blossoms that is the extent that the eye can consider moving to be lovely as anything he has gone over before in the breeze. In the accompanying verse he starts to truly depict the blossoms in incredible detail. ?Persistent as the stars that sparkle and twinkle on the Milky Way they extended in endless line? (Wordsworth). He articulates its excellence such that causes it so beautiful so you to can imagine its magnificence. They make him think about the Milky Way the manner in which they are pressed so firmly together.it appears as though it will continue forever. At that point he proceeds to state he accepts there could be around ten thousand blossoms directly before him. At that point he utilizes embodiment that the bloss oms are moving like they have a sprit in them that is really making them move. The following verse is tied in with looking into the blossoms and the lake. Despite the fact that they are both exquisite and contacting he accepts that the blossoms give of a vibe that is glad while the lake is simply glittery and sparkling. He proceeds to state that such as himself an artist couldn?t contain his bliss in the organization of such style and magnificence. He gazed for quite a while attempting to appreciate the essentialness of what looking would provide for him. ?They streak upon that internal eye which is the joy of isolation? (Wordsworth).In the last refrain he discusses when he at last understands it. He discovers that it was subsequently when he was separated from everyone else and discouraged that he thought on that time in the field and it made his heart simply dissolve. That experience gave him what he has always been unable to see as a writer and now he can utilize it to further hi s potential benefit at whatever point something turns out badly or makes him sad.

An investigation into the use of science by one environmental advocacy Assignment

An examination concerning the utilization of science by one ecological promotion body corresponding to natural issues - Assignment Example The notice likewise worries about how to control the people for understanding the duty to keep the world from the perilous obstructions of nature change. Despite the fact that each legislature of the industrialized countries had consented to take sufficient measures by setting explicit focuses just as timetables for the decrease of carbon-dioxide emanation alongside other ozone harming substances yet such activities have not brought about any solid results as the whole world is seeing an acceleration of fluctuated basic ecological concerns step by step (Hohnen, n.d.). Along these lines, with respect to this blasting issue, Greenpeace, a non-benefit association has committed its exercises so as to improve just as protect the nature of the planet just as condition (Greenpeace, 2013). The goal of the report is to quantify the commitment to banter on environmental change by Greenpeace and to fundamentally evaluate the association between its qualities and interests, its promotion positio ns and its utilization of science. Commitment of Greenpeace to Debate on Climate Change Greenpeace is an all around perceived non-benefit association that executes detached activities to diminish the predominant dangers to condition. Greenpeace plans to shield just as preserve nature through advancing harmony by uncovering, researching just as facing environmental maltreatment. The association has driven its drives by holding a great deal of meetings testing the political just as exchange alongside industry controls that are being engaged with playing out certain inconvenient exercises for the earth. Greenpeace is the voice of a great many supporters overall who are ecologically just as socially answerable for the current just as group of people yet to come. What's more, for rousing the entire world in regards to the worry about natural neatness, the association has featured different issues through media discharges, gatherings, by sorting out petitions just as through its sites amo ng others. In 1992, after the legally binding mark of the FCCC, the head of Greenpeace science group named Dr. Leggett composed a book on the causes just as results of the environmental change. Alongside it, Dr. Leggett likewise directed gatherings with various industrialists for sharing the evaluation of atmosphere science just as its ramifications. In this unique situation, Greenpeace gains huge positive reactions from protection industry for beginning the logical fortification through assessing the hazard to the future world. As far as inclusion, the association constantly raises its voice against Canada for shielding the Arctic from oil slicks. The oil organizations consistently try to show political power and hastily dirty water just as air that are undermining people’s regular method for presence. Moreover, Greenpeace likewise causes useful methodologies so as to diminish the logical compound dangers that lethally hurt the environment of the world. Remaining on this gra ve circumstance of the globe, the association has advanced a ton of relevant approaches for taking out the most despicable aspect of such basic

The 5 Autonomous Regions of China

Juvenile Delinquency Essay - 1646 Words

A juvenile delinquent offense is an act committed by a juvenile for which an adult would be tried at a criminal court. New statistics give an alarming picture: juvenile delinquency is higher as never before. According to the census bureau, in 2008 there were 1,653,000 recorded delinquent offenses in the United States. This is a 23.6% increase from 1990 when 1,337,000 delinquent offenses occurred. Today, a lot of people demand lowering the age of criminal responsibility and draconian penalties (Jenson Howard, 1998; Melton, Petrila, Poythress, Slobogin, 2007). These individuals react to this obvious social crisis with an attempt to fight the phenomenon with curbing the symptoms but without considering the causes which are created†¦show more content†¦This paper will give an overview of the causes of juvenile delinquency, the treatment, and an excursion to other countries and their causes of delinquency. The increasing globalization and the need for collaboration between the different countries make this comparison necessary. Causes of Juvenile Delinquency There are many theories that attempt to explain the causes of juvenile delinquency. Those theories either focus on the individual or on the society as a major influencing factor. Theories that consider the individuals as the cause, assume that children and juveniles commit crimes because they were not penalized for previous misdeeds or assume that the juveniles have learned their criminal behavior through the interaction with others (Ferguson, San Miguel, Hartley, 2009). A person that is alienated from society may be more prone to committing crimes. The theories that question the role of society in juvenile delinquency, assume that children, that commit crimes, act because frustration about their inability to develop beyond their socio-economic status or try to reject the dominating values of society (Brezina, 2008). Most theories of juvenile delinquency deal with children from disadvantaged families and ignore the fact that children from rich families also commit crimes. Those juveniles merely do not get arrested as frequently (Tapia, 2010). This group of juveniles can commit crimes because theyShow MoreRelatedJuvenile Delinquency1154 Words   |  5 PagesDiscussion In common parlance, there is an understanding of juvenile delinquency as meaning adolescents breaking the law or participating in mischievous behavior. Defining juveniles as being under the age of 18 years is the general rule of thumb because, in the current legal system, upon reaching this age individuals can be tried as adults, serve in the military, and, in some states, consume alcohol. (Reckless, 1972) One may ask why juvenile delinquency is viewed as a separate construct from adult deviantRead MoreJuvenile Delinquency2109 Words   |  9 PagesJuvenile Delinquency 1 Juvenile Delinquency: Features, Causes and Solutions Shen Cheng Class: 110 Teacher: Stephanie February 29, 2012 Juvenile Delinquency 2 Outline I. Introduction Thesis statement: Nowadays, there is no denying that Juvenile Delinquency has become one of the hottest social issues. The features, causes, and solutions of Juvenile Delinquency will be discussed about in this research. II. The features of Juvenile Delinquency A. The average age of juveniles who commitRead MoreJuvenile Delinquency2343 Words   |  10 PagesOpener: B. Thesis statement: This term paper explores how family issues attribute to juvenile delinquency and how to overcome it. II. First and foremost, an unstable family structure is one of the contributing factors to juvenile delinquency. A. Single-parent household vs. two-parent household B. Child maltreatment 1. emotional neglect 2. physical abuse III. Secondly, studies have shown that juvenile delinquency is conclusively related to the family environment. A. Family cohesion B. Increasing numberRead MoreJuvenile Crime And Juvenile Delinquency1322 Words   |  6 PagesVersion). Juvenile crime, in law, term denoting various offense committed by children or youth under the age of 18. U.S. official crime reported that in the mid-1900’s â€Å"about one-fifth of all persons arrested for crimes were under the age of 18† (Funk Wagnalls, 2014). Such acts are sometimes referred to as juvenile delinquency (Funk Wagnalls, 2014. Offering constructive programs reduces juvenile delinquency and reduces recidivism. â€Å"From the beginning, the principal consideration of the juvenile courtsRead MoreJuvenile Delinquency : Adult Delinquency2861 Words   |  12 PagesAlexis Kelly SOC 333 William Franks Spring 2015 Juvenile Delinquency Prevention Programs What is juvenile delinquency? Juvenile delinquency relates to minors who commit law violations. Instead of adults commiting â€Å"crimes’, juveniles are considered to commit â€Å"delinquent acts†. Society sees juvenile delinquents as immature and in need of guidance, which is different to adults, who are seen to be responsible for their crimes. Juvenile delinquency can occur in any community, neighborhood, and schoolsRead MoreJuvenile Delinquency2264 Words   |  10 PagesJuvenile Delinquency is the participation of illegal behavior by a minor who falls under a statutory age limit. A delinquent is a minor who commits a crime or a status offense. A status offense is conduct that is illegal only because the child is under age i.e. smoking cigarettes (Senna 10, 20). The cases of Eric Smith, Lionel Tate, and an unidentified NJ child are similar only because, they are guilty of killing another child, but the Criminal Justice System treated and punished them very different lyRead MoreJuvenile Crime And Juvenile Delinquency1458 Words   |  6 PagesDay in and day out residents and visitors to the Boston area are affected by juvenile crime and delinquency. Though the crime rates in MA and across the nation are on a steady decline, these juvenile crimes are still considered a serious matter that needs attention. It is thought that juvenile offenders do not cope as well with the criminal justice system as well as adults may be able to and therefore there needs to be a focus on how the system can better aid in the rehabilitation of these youthfulRead MoreThe And Prevention Of Juvenile Delinquency970 Words   |  4 PagesJuveniles in the justice system is an issue relevant not only to people in the criminal justice system but to society in general. There have been a number of studies done that link serious behavior problems in children to adult criminal conduct. In more recent years, there has been more research done regarding the causes and prevention of juvenile delinquency. The Department of Juvenile Justice lists 3 broad categories with many subcategories to help us understand what contributes to juvenile delinquencyRead MoreJuvenile Delinquency Is A Problem1508 Words   |  7 PagesJuvenile Delinquency When looking into the history of United States and elsewhere juvenile delinquency is a problem and has been one for over a century. Like other systems in place, the system involving juvenile delinquents has gone through many stages. In the case of the juvenile delinquency, it has gone through four stages, with us presently in the fourth. The causes behind juvenile delinquency are still unknown even today. Some blame it on the current culture, the over-exposure to violenceRead MoreEssay Juvenile Delinquency1499 Words   |  6 PagesMain Post: Juvenile delinquency is a problem that affects society as a whole. Understanding Juvenile delinquency is important because it is part of trying to figure out how people in American society should react to it; specifically, in terms of law enforcement officers, their agencies, and State legislators. When deviant behavior becomes continuous, chronic and widespread it gets perceived as a significant part of the population as threatening to the general well-being of society (Thompson

Rhetorical Analysis of the Essay ‘Our Wall’ - 750 Words

‘Our Wall’; written by Charles Bowden; is one of the essays focused on border problems, especially with the illegal immigrants and smuggling; and the wall to prevent the same. The author is an American non-fiction author, journalist, and essayist who mainly depicts the realism, and presents it to the society with the hope of change. In this essay, ‘Our Wall’, he cites the wall is made by U.S in order to control the illegal immigrants from Mexico. The essay collects views and comments before and after the establishment of wall of the people from both sides. This essay seems to be in against of the wall, which generally breaks up the personal ties and humanitarian relationship of the people in and out of the wall, and the wall stands still†¦show more content†¦One believes that the border is attacked by the ghost. Hundreds of people die each year while running away from border patrol, and violence from smuggling. The immigrants move here and there of borders to find a way to wealth of the America and sometimes find their way to death. It shows the heart rending situation of poverty and people fighting for death to earn. Some immigrants go back when there is problem in their home, and can never come back due to border security. ThisShow MoreRelatedRhetorical Analysis : How Tactically Is Applies Pathos, Ethos, And Logos1084 Words   |  5 Pagesthat it will likely change minds? You must measure it’s through a multi-step analysis. A rhetorical analysis. A rhetoric analysis is a process by which a piece of writing is measured on â€Å"how tactically is applies pathos, ethos, and logos†, and how effectively it panders to its audience. If it fails to address the uses of all three appeals, and or it omits consideration of audience pandering, then it is not a rhetoric analysis. Identified by Aristotle, Ethos, pathos, and logos, which are the three mostRead MoreHow Friendship Can Not Be Defined Because No One1627 Words   |  7 PagesTitle? In this essay I will talk about how the term â€Å"friendship† cannot be defined because no one can judge other people’s personal value of what a friend is to them. Friendship is used in many contexts because of technology and how it is used from different levels of personal, formal, and informal meaning I believe that â€Å"friendship† can be on all three levels. The personal level is the friends who are intimate with you. The personal term for friendships is â€Å"intimacy†. The second level that I believeRead MoreStairway to Heaven by Led Zeppelin1602 Words   |  6 Pagesmain part of this essay contains the analysis of the artifact. The meaning in almost every verse when the song is broken down is foremost given in this analysis. Later, we shall critically analyze the song and give deductions of the analysis. An evaluative judgment of the artifact of this song is done. The revelation of the analysis about the artifact in particular and about rhetoric al processes in general will be explained. A conclusion will highlight the role the song plays in our daily lives InRead More Anna Quindlen Essay1208 Words   |  5 Pages Rhetorical Analysis nbsp;nbsp;nbsp;nbsp;nbsp;Anna Quindlen describes in the essay â€Å"Abortion is too Complex to Feel one Way About† the different situation that we as a human race are put in everyday. She talks about the topic of abortion in a way that one feels they have had to make the decision of whether or not a person is pro-choice or pro-life. She uses references that are of different personal experiences in the essay that are vital to the audience. Quindlen is writing to state her pointRead MoreEssay about Anna Quindlen1208 Words   |  5 PagesRhetorical Analysis Anna Quindlen describes in the essay Abortion is too Complex to Feel one Way About the different situation that we as a human race are put in everyday. She talks about the topic of abortion in a way that one feels they have had to make the decision of whether or not a person is pro-choice or pro-life. She uses references that are of different personal experiences in the essay that are vital to the audience. Quindlen is writing to state her point that one should never putRead MoreRhetorical Analysis Of On Compassion 1233 Words   |  5 PagesRhetorical Analysis: ‘On Compassion’ People tend to brush off something or ignore something that we do not understand or like. Many Americans do this. So if most of America does this, then what gets done with that problem? Nothing! Barbara Lazear Ascher’s ‘On Compassion’ shows this to a new level. She shows us how the homeless is struggling and everyone turns their heads about it even though it is a big problem in New York City. Ascher’s use of good logos, pathos, and ethos comes together to showRead MoreRhetorical Analysis of the Grapes of Wrath1767 Words   |  8 PagesSeptember 7th, 2012 Rhetorical Analysis of The Grapes of Wrath The dust bowl was a tragic time in America for so many families and John Steinbeck does a great job at getting up-close and personal with one family to show these tragedies. In the novel, â€Å"The Grapes of Wrath†, John Steinbeck employed a variety of rhetorical devices, such as asyndeton, personification and simile, in order to persuade his readers to enact positive change from the turmoil of the Great Depression. Throughout the novelRead MorePresidential Election And Paint It Essay1326 Words   |  6 Pageshistorical events and their rhetoric to the present. 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Correlation Between Student Incomes and Student- myassignmenthelp

Question: Discuss about theCorrelation Between Student Incomes and Student Services. Answer: Introduction MacEwan provided services are set in place to help students through the many challenges and obstacles that students face while attending university. These services range anywhere from sexual violence to providing services for students facing learning disabilities. One topic of interest however, is a students level of income and how it can play into the effectiveness of the services provided by learning institutions. It is important to understand the effect these services have on students who make different incomes while going to school. By understanding the difference between high-income students and low-income students it will help us to determine if the services provided by MacEwan are reaching their intended audiences. In the following document we will provide an analysis of peer reviewed articles and their relation to our topic of interest. We will also provide an in-depth methodology report which will outline the research we are going to conduct in order to answer the following research question. Does a students level of income affect their use of MacEwan provided services? In addition, we will provide a timeline as to how we will go about collecting and organizing our data. Literature Review We began our literary searches with the goal of answering the question: how does student income affect how students use McEwan provided students. Blakes (article B) article focused on the relationship between the magnitudes of a students postsecondary funding and their program choice as well as course load for their first year at school. Charlies article (article C) investigates the ethics of whether it is the university's responsibility to provide students with Human Services as well as the magnitude of Human Services that it is reasonable to provide. These articles can be divided into two main categories. Article B and article C both pertain to how income and student funding affects the general student experience and article S focusses primarily on how a student's hereditary might have would affect their use of services and general performance in school. Three important observations can be taken from each of the two categories of literary reviews. The first and most important conclusion, is that funding seems to have a huge impact on a student choices at school and consequently the services that they end up using. Article B and C both make it very clear that income affects the choices that students make at school. In article B, it was found that the more leveraged a student was the more likely they were to have a declared major as well as choose a program in the STEM category. Secondly, there is more than just one issue that is affecting a students use of services. Article S evinces this with the finding that 90% of students did not think having a learning disability would stop them from pursuing their education and while 90% seems like a high number we must also take into account that it also means 10% of students would probably drop out or not even attempt post-secondary education if they believed they had a learning disability. The last take-away from all three literature review articles pertains to methodology. Originally, our group had planned on doing most of our research by way of anonymous surveys of hundreds of MacEwan students. However, after reading through all the articles one common theme emerged in regards to the methodologies that the authors of these articles used. They all conducted surveys as well as in persons interviews of dozens of people to collect their data. Knowing this, our group will be conducting a few in person interviews in addition to surveys in order to strengthen the quality of our research. All of these findings are encouraging for our research project because they appear to support our groups hypothesis that student income affects the services that students use at Grant MacEwan University. Article B and C reinforce that there is a relationship between the amount of funding students have access to and the choices they make at school and article S reminds us that although it may appear that income may be one of the most important aspects affecting how and what services a student uses it may not be the only factor. Methodology The article deeply talks about the students from low-level households. Therefore, to get better results we are thinking of conducting methods that will include some deep interviews with the groups of such students consisting of both males and females. Since this case is quite complex so, we are thinking to opt for a mixed method which will include both qualitative and qualitative type of inductive approach. Therefore, well go for choosing testing theory over conducting theory. Along with the students we will seek for some knowledgeable informants who can help us inquire the case satisfactorily. Further, the data can be collected by enrolling more interviewees to get better knowledge about their backgrounds until a theoretical saturation is achieved. Moreover, we will collect data in a cross-sectional manner by conducting a questionnaire referring to one current point in time which includes face to face casual conversations. Also, we will e-mail our friends and classmates to get more information to get good results for our survey. For this survey, we estimate to interview and cross-question at least 50 students or even more who study in Grant MacEwan University. Therefore, if we will be successful in collecting data without any internal or external interruptions, then further we will look forward to presenting the whole survey in a statistical manner. Timeline Conclusion In reference to the literature review (the articles BC and S, we can develop an insight of the findings that are likely to come up from the research studies. As seen before, all the articles reviewed have a positive correlation with our research hypothesis. The articles, B and C all have it that the financial status of the students directly affect their use of the institution provided services. It is typically certain that students choices on the type of services they use is substantially influenced by their socio-economic status in accordance to the reviewed literature. We also establish that, apart from just the financial status of the students, there are a number of issues that affect the type of services that a student chooses, which among others, included the learning disabilities. The likely gaps that would weaken reliability of the report have already been discovered in the methodology section. Making use of interview alongside survey gives a guarantee of dependable results We can surely establish that in the proposed research, we have over 70% of the likely findings and therefore we can briefly conclude that the research study will produce a highly reliable results since the methodology will deeply exploit the primary study population to establish concrete findings. Reference List Cady, C. (2012). Discussing Poverty as a Student Issue: Making a Case for Student Human Services. Journal of College and Character, 13(3), 4. doi: 10.1515/jcc-2012-1908 Cady, C (n.d.). Linked In profile. Retrieved from https://www.linkedin.com/in/clare-cady-81b66257/ Miller, A., Zhang, L. (2009). The Effects of Welfare Reform on the Academic Performance of Children in Low- Income Households, 28(4), 577-599. doi: 10.1002/pam

This Earth of Mankind Essay Example

This Earth of Mankind Paper This report is based on an interview of Pramodeya Ananta Toer which explains the background thought processes of his four book series the â€Å"Buru Quartet† however the references taken shall be based solely on the first book of the quartet â€Å"This Earth of Mankind†. Pramodeya says that the idea for Minke the male protagonist of the quartet was based mostly on â€Å"Willem Wertheim† a Dutch scholar, this seems mostly ironic as one of the main antagonists in the novel happens to be the Dutch government and it is against Dutch colonialism that Minke stands up but as Toer says â€Å"He brought out the characters who had been erased from our history. Not only this but also â€Å"I had students pore over newspaper stories from the period and wove episodes into the plot† thus it cannot be said that the lead character was based solely on one inspiration, however we do see that Minke happens to be more ambitious than his fellow countrymen and also has a more enlightened attitude which does have a European or in this case Dutch in nature and hence could explain Toer saying he was based on Willem. We also notice the similarity of the book with the events at the time when Toer was writing the book such as the power of the ruling government to take over private businesses in order to run them ‘fairly† and act as caretakers as seen in the Dutch taking over the Nyai’s business, and we also see the apparent class system and high level of social segregation which was still present in Toer’s time, it also seems that Pramodeya did have a direct source to base Minke on in the form of the Philippine novelist ‘Jose Rizal’ who was executed by the Spanish in 1896 after three years of imprisonment and torture for championing freedom from colonial rule however he does not mention this. We will write a custom essay sample on This Earth of Mankind specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on This Earth of Mankind specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on This Earth of Mankind specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We also see that Minke’s main enemy other than the Dutch was Robert Surhoff a man so confused by his own birth that he develops a superiority complex in order to make himself appear better than his fellow countrymen as can be seen by his calling Minke Indo all the time considering the title ‘Bupati’ beneath him even though it was a position of power more than he could ever have this however was one of the numerous people suffering from similar Psychological problems due to the changing time. The idea as Toer says came from an Eurasian gang organized by the Dutch to terrorize the people of Jakarta and this is also pretty much what Robert Surhoff is also doing, another thing that is also most remarkable is the irony of the situation that the very people they try to imitate and please, by harming their own brethren in order to get their acceptance do not treat them with much respect and also consider them below their level. Which can be seen in the novel that the Dut ch born first son of Mr. Mellema is given preference to the property over Mellema’s half Dutch children this concept is a forerunner to the idea of 2nd class or 3rd class citizenship which is still another form of Racism left over from colonial rule. Pramodeya’s inspiration from other works such as John Steinbeck’s â€Å"Of Mice and Men† and the works of Gorky and Tolstoy are quite evident. Pramodeya integrated the running theme of â€Å"Try to understand each other† from ‘Of Mice and Men’ into his quartet as it seems the only way out of the problem that the colonials and the colonialists are facing is if the two groups try and understand each other and Pramodeya in a way is showing what happens when individuals and communities on a whole do not understand the other persons view point and try to assert that they are right or superior over the other. Other concepts also evidently integrated in the novel taken from Steinbeck’s novel are dreams, loneliness, how mans prosperity achieves cruelty, powerlessness, and uncertainty of the future — or fate. All seen in the life of Minke and how he progresses through out the first novel as not only his rise to fame gain him the enemity of his Rubert Surhoff and Mellema but also that of his brother to an extent and also that he dreams of changing not only his life but also the life of his fellow people however in the face of the unexpected events and ‘fate’ he was helpless/powerless. Also from Gorky’s work we see Pramodeya geting the idea of showing the social fabric of Indonesia in the novel and to show the distinctive charecterists of Indonesian people and to give a psychological aspect to the novel.

The Great Awakening essays

The Great Awakening essays The Great Awakening started as a questioning of religion and authority of government. This led to tolerance of new beliefs. The Great awakening created a sense of shared American identity that affected the people who experienced it all across the colonies. People grouped together no matter were they were from or whom they were. It also led to religion for black slaves and Indians because of missionaries. There were many causes and effects of the great awakening. One cause was the low attendance at churches. People thought what is the need to go to church if we can earn or way to a higher place ourselves? After people challenged the church the thought why cant we question the government? The government was threatened by this because they knew the people could and would. It had many effects like the growth in amount of churches. The churches were very competitive to get people to attend their churches. It also lead to many new colleges referred to as the New Light. The great awakening had a very intense religious revival. There were many people who led revivals for religious reasons. Jonathan Edwards was one of the first and then George Whitefield who made the biggest impact of all the revivalists. George Whitefield went along the Atlantic seaboard preaching looking for sinners who would convert. People who converted felt very independent being able to do what they wanted freely. People who did not convert criticized conversion, also viewed the converters as a threat to established order. The awakening gave America a sense of shared identity. During the great awakening everyone came together due to religion and to convert. Even Indians were involved with Americans religion because of missionaries. All people no matter what race, sat in the same church listening to people like George Whitefield. The awakening was a big step because it brought all people in America together. ...

Look at the the instruction (2) Essay Example | Topics and Well Written Essays - 750 words

Look at the the instruction (2) - Essay Example In solution, ethanol reacts with the potassium dichromate, reducing the dichromate ion to chromium(III) ion. This reduction results in a change of the solution’s color from red orange to green. The extent of the color change, precisely measured by photoelectric cells revealed the amount of alcohol in the sample (Willet, 1996). This chemical analysis though, is not very accurate due to the presence of interfering compounds which are similar in structure with alcohol. Since potassium dichromate is a strong oxidizer, numerous alcohol groups can be oxidized by it, thereby producing false positive results. New models include breathe analyzers using the fuel cell and infrared technologies. In a fuel cell, two electrodes are immersed in an electrolyte – a substance that conducts electricity. Fuel, typically hydrogen, is provided to one electrode, and oxygen to the other. The result is a flow of electricity between the electrodes . In a breathe analyzer, the alcohol in the breathe becomes the fuel for the fuel cell, the higher the concentration of alcohol in the breathe, the more electricity is generated. The measure of the strength of the current being generated will determine the concentration of alcohol in the breathe sample (Willet, 1996). The fuel cell technology may be considered as chemical sensor even if it is the electricity generated that is being measured. The electricity generated is proportional to the amount of fuel supplied by the alcohol group to the fuel cell. This means that the electricity generated is dependent on the fuel or the amount of alcohol supplied. The limiting factor or the sensor is the alcohol compound in the breathe sample. When the alcohol in the breathe sample is already exhausted, generation of electricity will also stop. Thus, the alcohol from the breathe sample is considered as the chemical sensor since the electricity generated is

Red Blood Cells Cytoskeleton Article Example | Topics and Well Written Essays - 250 words

Red Blood Cells Cytoskeleton - Article Example The membrane of a red blood cell is a lipid bilayer with transmembrane proteins and a myriad of filamentous proteins along the whole membrane. In the membrane cytoskeleton, spectrin is the most commonly found protein, forming long and elastic heterodimers, that join head to head to form heterotetramers, the tails of which are composed of F-actin, protein 4.1, and actin-binding proteins called dematin, adducin, tropomyosin, and tropomodulin (Stokes). This whole meshwork of proteins is attached to the cytoskeleton at two places: â€Å"one mediated by ankyrin that couples spectrin to Band 3 and the other mediated by protein 4.1 that couples the junctional complex to Glycophorin C† (Stokes, para.2). So, we see that human red blood cells are deficient in actin–myosin–microtubule cytoskeleton, which is helpful in cell shape determination, according to a recent research (Acton 69). The proteins of the cytoskeleton plasma membrane interact to form a barrier for toxins, b ut help the ions and information signals to pass in and out of the cell membrane. Stokes, David. â€Å"Architecture of the Cytoskeleton in Red Blood Cells.† Laboratory of David Stokes. NYU School of Medicine, 2011. Web. 18 Nov 2012.

Analysis on the role of women and men in vanity Essay Example for Free

Analysis on the role of women and men in vanity Essay Victorian era literary has produced many different masterpieces from many different writers who focused mainly on the emergence of interpersonal issues involving love, money and social status, usually backdropped by a historical event with national relevance at the time of the story telling. Vanity Fair is one of these types of this kind of work. And even until today, Vanity Fair is one of the materials referenced by critics during literary analysis involving the role of women in the society, the role of patriarchal influence in the Victorian era social politics and the presentation of different women stereotypes in literature. Vanity Fair is a serialized literary material written by William Makepeace Thackeray, published initially in the pages of Punch Magazine in the United Kingdom, beginning at the start of the year 1847, the final instalment appearing a year later in July. The initial title of this masterpiece was Vanity Fair: A Novel without a Hero. A popular saying describes vanity as the favorite sin of men and women, a line of thought which will be heavily discussed and supported in this particular paper through the analysis of the presence of vanity and the role of men and women inside the society on the propagation and existence of vanity. Vanity Fair is a very interesting book that attacks personal and societal illnesses that causes the corruption and corrosion from the inside of what was believed to be a socially-shared moral right. The author attacked the issues and the personal and social crises by pointing out the role of individuals as well as the role of the structure of the society that influences the lives of the individuals in the story. â€Å"Almost every sin in Vanity Fair can be traced, beyond personal weakness, to the fundamental laws of money and class The poison in Vanity Fair infects the bottom rungs of the social ladder as well as the top (Dyson, 1973, p. 86). † The role of women in William Thackeray’s â€Å"Vanity Fair† There are many different women found in the novel Vanity Fair. But there are some key female characters that provided significant roles in the story so that the novel can depict the real life situation in the Victorian era and in the process provide whatever moral lesson it can about the aspects of life that it managed to discuss and tackle. The list of key female characters that require scrutiny and analysis is topped by the three women characters that possess any or all of the traits that made them important, like personality, influence, cunning and power: Miss Crawley and the contrasting Becky Sharp and Amelia Sedley. Becky Sharp – In a novel without a hero, Becky Sharp was the heroine, even if for some she is the anti-heroine. Becky was one of the two lead women characters who are central to the story. The two girls are opposites in many different ways, and their lives continue such path, with Becky becoming the most villainous of the two and Amelia Sedley her exact opposite. Indeed, the character of Becky Sharp was the catalyst for social abrasion. Some might feel that Becky represents everything that is morally bad and undesirable in the society inside Vanity Fair. Sharp’s character also reminds the readers that people cannot ignore people like her and the characteristics that she displays, dismissing it as a characteristic that is a mere product of a fictional character. Her character represents a type of individual who is alive in the real world. In some twisted consideration, Becky can be considered as the source of â€Å"life† – if life means the presence of constant conflict and the consistent surfacing of anything unexpected – inside a society because Becky does not let social norms get in the way of what she wants. â€Å"The woman who goes after money and status but finds that they do not satisfy her a woman like Becky Sharp is allowed to be at least morally interesting (Garson, 2007, p. 99). † Whether readers admit it or not, Becky’s character is an important pull to the consciousness of the readers; she provides the intrigue and sin that readers on the outside condemn but diligently follows through in the next episodes of the novel. Becky seduces and elicits the feeling of scorn and hate so much that she makes the readers always eager to know what happened to her, largely because real life readers are as vain as her. Becky taunts the devil in the readers, making them think and reconsider the â€Å"what ifs,† the things that Becky is not afraid to do which the readers are having second thoughts of doing. Becky triggers the fantasies. For the women readers, it is the fantasy of being able to pull of seduction and gain worldly possessions, to bed many different men and feel a different kind of power, to be free from the shackles and restraints the patriarchal society placed upon women and to be largely free and unaccountable to anything. For male readers, the fantasy is to be seduced by a Becky Sharp, to be offered body and lustful obedience in exchange for money and power that not every man can have in his lifetime. Becky made the world go around inside Vanity Fair, even if the sad part is that as a whole, she is still a mere part of the patriarchal society that used her as much as she used it to her advantage. â€Å"And what else creates change in Vanity Fair if not Beckys subversive sexual behavior? It is she deprives Amelia of a loving husband well before Thackeray has him killed off on the battlefield at Waterloo (Armstrong, 1990. p. 178). † Amelia Sedley – Amelia contradicts Becky in comparison in many ways. Amelia always opts to live in the past and is tied with the memory of past while Becky is always looking ahead into the future. Amelia is always passive and easily contented, while Becky is always on the move, always hunting or scheming so that she can get what she wants. Amelia is the prototype for the docile and meek domestic housewife, during and after her married life with George, while Becky was â€Å"anything but. † Amelia gives the readers hope that there are still people who walk the straight path of morality, while Becky is jumping up and down, always falling far from where morality wants her to be. Amelia’s role in the novel is more than just as an individual who represents everything that Becky is. Amelia, to some extent, was also the symbol of the ills of the life of being meek and sulky. She is the anatomy of the unknowing victim, the unwitting casualty to the moral massacre that poverty, indebtedness, puritanism and being overly morally upright undertakes in everyday life. She was an angel all right, but Thackeray made sure that even with wings it is easily discernable that Amelia is far from being in heaven largely because of her personality. Amelia, as a character, lived a life that was far from being the ideal married life, and the story was as unkind to her as the critics of the symbolism of woman to which she stood for. â€Å"Late-Victorian women writers contributed to the fight for womens rights by creating representations of women that confronted the self-abnegating, submissive, housebound image of middle-class Ideal Womanhood. This ideal was epitomized at mid-century by William Thackerays Amelia Sedley from Vanity Fair (Mangum, 1999, p. 2). † Becky and Amelia: The analysis and profiling of the real heroine The heroine in the story can either be Becky or Amelia, depending on the reader and the readers perspective and moral standpoint. This is because the identification of the heroine type between the two female characters in the novel speaks a lot about the personal characteristics of the person making the difference between the two. The reader would be placed in a dilemma wherein the reader has to choose which personality she would approve between the polar characteristics of Becky and Amelia. â€Å"Plot in Vanity Fair is primarily the histories of two women: one, the shrewdly competent Rebecca Sharp, consistently exploits the conventions of high society to rise within it; the other, the compassionate but vulnerable Amelia Sedley, is exploited by Rebecca and others in their campaign to achieve social prominence (Lund, 1992, p. 23). † The author was consistent with what critics call as rule in the creation of fictitious married female characters. The story divides the desire for love and for materials goods between two individuals who are vaguely antagonists or protagonists in the story. The clear idea to the readers is the priorities of the women as human characters, looking at them outside the scope of gender. As a human character, Becky was the one who puts material things above all, while the character of Amelia puts love above all providing not just a state of realism but also a sense of balance to the presence of contrasting but significant roles in the novel. With this the reader, male or female, would knowingly or otherwise pick one of the two to become his/her heroine largely on the identification of the same grounds where the character and reader stands. A reader will hardly choose both because like the rule of the fiction writing, the reader will only empathize with the predicament of the character with whom he or she relates the most. â€Å"The rule in fiction is that a female character cannot want both love and luxury. Rare indeed is the novelistic heroine who genuinely loves her husband but who at the same time desires and frankly enjoys the goods that he is able to buy her (Garson, 2007, p. 99). † Thackeray makes it more difficult for the readers to pick which is the heroine between the two opposite characters because an important characteristic of the difference between the two is that the author created characters which are neither white nor black. Becky and Amelia are both neither strictly good nor straight-out bad. The differences of the two candidates for heroine-ism also made implications that altered their state of being good or bad as their state of lives moves forward in the story. There is a sense of goodness in Becky as much as there are some things in Amelia which may merit disapproval from the readers. Because the story is centered on domestic life of couples and the complexity that the society and the personalities of the people in it contribute to the lives of married individuals, the personalities of Beck and Amelia as wives are just as important pieces of consideration as much as their own personal characteristics are in the pursuit of defining who is the more suitable heroine between the two. And like their personalities as single individuals, how they were as wives is just as complicated, Thackeray became consistent with the idea of ending up with having no real defined hero (or heroine for that matter). It forces the reader to take a very good look at real life before finally judging who between Becky and Amelia deserved to be raised in the pedestal as the ideal woman and wife. â€Å"The role she plays perhaps most productively is that of the faithful and charming little wife to Rawdon Crawley. Ironically, as long as she finds it advantageous to play this role, she is a much more effective domestic angel than Amelia Osborne, whose devotion to her husband George is heartfelt but sterile, who maternal affection is positively destructive, and who is quite unable to repay Dobbin for his years of devotion. In contrast to Amelia, Becky brings out the best in her husband, transforming Rawdon from a randy roue to a contented husband and a devoted father (Garson, 2007, p. 99). †

Nature of Logic and Perception :: essays research papers

According to the American Heritage dictionary, the definition of Logic is â€Å"the study of the principles of reasoning, especially of the structure of propositions as distinguished from their content and of method and validity in deductive reasoning†. It also says that logic is â€Å"valid reasoning.† I believe that logic and critical thinking are closely related in that logic is used in the process of thinking critically. Perception, as stated in the American Heritage dictionary, is â€Å"the process, act, or faculty of perceiving†. Perceiving is to become aware through any of the senses. I think that a lot of my behavior or actions are driven by my feelings or attitudes. An example would be if I were feeling angry my action could be to yell at the person I was angry with. I think that my feelings or attitudes are driven by my beliefs. I come from a dysfunctional family, like most of us I guess (assumption), and my mother was the primary care giver in our home. I have seven brothers and sisters however I was raised with my two youngest sisters so I was the oldest in the house. My older brother is thirteen years older than me and my older sister is just one year old than me. Growing up, I had some a few good memories of my older brother, but I had no memories of my older sister. Actually I should say that I have no visual memories of my sister. My mother told me stories of my sister. The weird thing is that growing up, it seemed like she had this long relationship with here, but in reality it was only a little over a year. After I was born, my mother separated from her husband and lost custody of her daughter and never saw her again until recently when my youngest sister found her. Boy that was an Oprah story! Anyway, the reason I bring all this up is because my perceptions growing up regarding my mother’s life were full of pain.

Credit Card and Paypal

In this report, we focus on all aspects of the PayPal business. PayPal Basics PayPal is quickly establishing itself as a global payment processor with scale, facilitating nearly $60B in Total Payment Volume in 2008. It remains the largest player focused solely on online payments; however when compared to the total volume of large global players, such as Visa and MasterCard, PayPal’s volume remains fairly small: its $60B TPV was just over 1% of the total volume of payments processed last year by Visa and MasterCard combined. Figure 1: PayPal’s Volume Dwarfed by Incumbents in billions 2,000 1,500 1,757 1,548 969 1,000 500 0 Visa (Credit) Visa (Debit) MasterCard (Credit) Source: Company reports, J. P. Morgan estimates. Note: Parts of PayPal volume may be processed using Visa or MasterCard’s network; Visa volume excludes Visa Europe 406 60 MasterCard (Debit) Pay Pal PayPal is an Established Payment Network and Brand – A Rare Commodity PayPal is in rare company , successfully creating itself into a formidable payment network and brand alongside dominant payment brands in Visa, MasterCard, American Express and Discover.Payment networks sit at the top of the value chain in payments, collecting high-margin fees for facilitating payments from participants seeking access to a network of trusted merchants and consumers. PayPal overcame the classic chicken-and-egg dilemma and now has a critical mass of users in its network, differentiated as a trusted brand for facilitating online payments with the potential to extend its presence into offline opportunities longer-term.One driver of PayPal’s growth is that, unlike traditional payment methods which developed in an offline world and have been overlaid onto eCommerce, PayPal’s platform was built with eCommerce in mind. As such, PayPal has developed tools and risk management measures to address the unique complexities of handling card not present payments over the web – one of th e fastest growth categories in payments. Moreover, PayPal is elegantly structured to simplify the web of connections required in a traditional payment system, making it well positioned to penetrate the small business payments market. Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 Figure 2: PayPal Simplifies the Payment Process Traditional payment structure Merchant Payment gateway provider Merchant bank Source: J. P. Morgan. PayPal payment structure Merchant Consumer Consumer Card issuer processor Card-issuing bank Merchant bank Consumer bank We think the online marketplace, and sellers in particular, benefit from this simplification in several ways: †¢ Ease of Use.PayPal gives virtually anyone the capacity to accept payments, enabling a merchant to operate even at an initial scale that would otherwise be uneconomical (i. e. , there are no minimum requirements for payment volume in order to use PayPal. ) Higher level of trust. The payments system is not very transparent, and not all aspects were intended for mass use. A trusted central clearinghouse like PayPal can encourage use of online payments by lowering users’ safety concerns and raising their willingness to send money online. †¢PayPal Is Differentiated beyond Just Online Commerce PayPal is different from other payment brands (e. g. MasterCard, Visa) in that it is a vertically integrated payment provider. In other words, PayPal is a single source provider of payment services. By contracting directly with PayPal Merchant Services, small merchants can get all of their payment needs, and do not necessarily need a separate merchant bank account or payment gateway services provider. PayPal is gradually expanding its presence off eBay by promoting itself as an integrated payment offering along side other payment brands (e. . MasterCard, Visa), supported by PayPal ’s own merchant services offering and alliances with payment vendors like CyberSource (payment gateway) and Chase Paymentech (largest merchant acquirer in the U. S. ). PayPal’s Product Offerings for Online Sellers PayPal offers several different products for payment acceptance, based on the size and needs of the merchant: †¢ Email product. This is the offering used largely by smaller eBay merchants, who receive payments entirely via e-mail, with no site of their own on which they need to integrate PayPal. Website Payments Standard.This product allows merchants to place a PayPal button on their site, and when a user is ready to check out, the user hits the button and is taken to the PayPal site where the actual checkout occurs. †¢ 4 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 †¢ Website Payments Pro. With an incremental $ 30 monthly fee, the Pro product is better integrated into a seller’s site. The product is intended for small- to medium-size sellers, and requires the seller to be using a compatible hopping cart vendor (most are compatible). Express Checkout. Intended for larger merchants (those already accepting include Dell and Barnes & Noble). Express Checkout is incremental to the payment acceptance service used by a vendor – it gives users an additional checkout option. When a shopper uses Express Checkout, s/he logs into PayPal, and PayPal then forwards address and other info to the merchant. This allows an existing PayPal user to bypass entering personal and shipping information again, even if it is the user’s first time using the specific merchant. †¢ Strong Growth in Active UsersBy continuing to add users across multiple platforms, PayPal has been able to post strong user growth in recent quarters, even despite the slowdown in on-eBay growth and low-single-digit u ser growth on the eBay site itself: Figure 3: PayPal Active User Growth Strong in Recent Quarters Users in Millions 150 100 50 26. 7% 23. 7% 20. 7% 19. 6% 18. 6% 19. 2% 17. 7% 16. 3% 16. 1% 16. 0% 17. 3% 22. 9% 21. 4% 30% 20% 10% 73 70 65 63 60 57 53 55 51 47 49 45 44 0 0% 1Q'06 2Q'06 3Q'06 4Q'06 1Q'07 2Q'07 3Q'07 4Q'07 1Q'08 2Q'08 3Q'08 4Q'08 1Q'09 Pay Pal Activ e Accounts Y/Y Grow th Source: Company reports, J.P. Morgan Payment Business Basics For a primer on the payments industry, please see Payment Processing: Payments Market Share Handbook published on June 5, 2009 by J. P. Morgan's Computer Services & IT Consulting analyst, Tien-tsin Huang When a buyer hands cash to a seller, the transaction is self-contained. If a credit (or debit) card is involved, however, several other parties become involved in the transaction, which we describe below: †¢ Issuer (Cardholder’s Bank). Card transactions start with a card issued by an issuing bank (e. g. Bank of America, Chase, et c. ) to a consumer.In terms of economics, the bank that issued the consumer’s credit card takes the purchase price, collects its interchange fee (in the US, ~170 -225 bps depending on the type of card), and passes the remainder to the†¦ Acquirer (Commonly the Merchant’s Bank). The acquirer provides merchant services to the merchant, handling all the card and/or electronic payment acceptance needs of the merchant. The merchant’s acquiring bank 5 †¢ Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 ccepts the payment, collects a merchant discount (generally in the 30-50 bps range in the US), and forwards the balance to the seller/merchant. Both the Issuer and the Acquirer pay a small (~7-9 bps each) fee to the Payment Network (see next entry). Merchant acquirer functions include: †¢ †¢ †¢ †¢ †¢ †¢ Sign up merchants to enable them to accept card payments. Enable merchants to authorize card payments via the network. Pay all network and associated fees for a merchant’s transactions Facilitate clearing and settlement of card payments Provide incremental services, e. g. , sending out statements, etc. Payment network (e. g.Visa, MasterCard). As the backbone to the payments industry, networks connect various banks that need to process credit card payments with merchants and provide authorization, clearing and settlement services. Networks also set rules and interchange rates (earned by the issuing bank). Payment gateway. In the offline world, the payment gateway is the equivalent of a point-of-sale terminal that accepts the payment type (e. g. credit, debit card) and translates it into a format that can be accepted by the merchant acquirer. In the online world, the gateway generally connects an eCommerce site with the merchant acquirer.PayPal already functions as a Payment G ateway, largely as a result of its acquisition of VeriSign’s payment business, which had 144,000 customers when acquired in 4Q’05. †¢ 6 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 Figure 4: Example of a Credit Card Payment Processing Cycle Source: J. P. Morgan. How Does PayPal fit in? In most cases, when a PayPal user pays with a credit or debit card, PayPal functions as the Merchant (in Fig. 4).PayPal relies upon its merchant acquirer (usually Wells Fargo) to facilitate the transaction. PayPal the charges the merchant its fees, which on average represent a spread over what the acquirer charges PayPal. In addition, if merchants want, PayPal offers certain merchant acquiring services such as the means to authorize valid card transactions and facilitating the clearing and settlement of the transaction through the payment network. At this point, we estimate that PayPal’s merchant acquiring business comprises less than 5% of PayPal’s TPV. 7 Imran Khan (1-212) 622-6693 imran. t. [email  protected] om Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 PayPal Revenue Model Transactional Revenue PayPal’s business model involves collecting a percentage of revenue from each payment made on the system; this percentage has remained in the 3. 75%-4. 0% range since F’05. In F’08, PayPal collected 3. 86% of TPV as revenue. The following table summarizes the contributors to take rate: Table 1: Contributors to PayPal’s Transactional Revenue Take Rate Type Cross-border transactions (â€Å"CBT†) US sellers, non-CBT Int'l sellers, non-CBT Payment Gateway Website Payments Pro Source: J.P. Morgan estimates % of revenue ~35% ~33% ~25% ~3-5% ~2-5% Comment PayPal charges up to 100 bps higher rates for CB transactions; charges an additional 250 bps for currency conversion Sliding scale from 1. 9% based on volume Country-specific pricing; generally higher rates than US Acquired from Verisign in 4Q'05; limited growth since Monthly $30 fee for WPP product Figure 5: Our Estimates of Contributors to PayPal’s Transactional Revenue Int'l rev enue Pay ment Gatew ay Website Pay ments Pro Monthly Fees Cross-border rev enue US rev enue Source: J. P. Morgan estimatesMarketing Services and Other Revenue Several items are counted as a part of Marketing Services and Other revenue. These include: †¢ Interest earned on some customer balances. PayPal earns revenue as it receives interest on the balances of some non-US account holders. Note that US customer balances are held in FDIC-insured accounts or in a money market account; PayPal does not receive interest on these accounts. BillMeLater interest and fees. Interest and fees earned on existing BML client balances are classified as Marketing Services and Other revenue. †¢ Comparing PayPal Fees to Online CompetitorsPayPal’s fee structure is similar to those of its online-only competitors; both Google Checkout and Checkout by Amazon offer a similar package of fees depending on a merchant’s monthly sales volume; Amazon differs in charging a slightly different fee level for transactions under $10 as well as minimal cross-border support: both buyer and seller must have a US-based financial instrument to use the service. Both Google 8 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 nd PayPal charge roughly (in Google’s case, exactly) 1% more for cross-border transactions. See Table 2 for a summary. As a point of reference, we believe offline fees for accepting cards (aka merchant discount rate) average around 1. 9-2. 0% in the U. S. In March of 2009, Google announced that it woul d no longer offer a discount on payment processing on Google Checkout for Google AdWords advertisers. Table 2: Fees for PayPal, Google, Amazon Remain Similar Transaction Type/Volume Transactions under $10 Up to $3,000 / month Between $3K-$10K Between $10K-$100K $100K and above Cross-border PayPal Same as below 2. % of transaction + 30 cents 2. 5% of transaction + 30 cents 2. 2% of transaction + 30 cents 1. 9% of transaction + 30 cents Varies by currency but ~1% extra; payments with currency conversion add 2. 5% charge Google Checkout Same as below 2. 9% of transaction + 30 cents 2. 5% of transaction + 30 cents 2. 2% of transaction + 30 cents 1. 9% of transaction + 30 cents 1% of transaction Checkout by Amazon 5. 0% of transaction + 5 cents 2. 9% of transaction + 30 cents 2. 5% of transaction + 30 cents 2. 2% of transaction + 30 cents 1. 9% of transaction + 30 cents US only (seller and buyer must have US-based account)Source: Company websites PayPal’s Transaction Costs Set aga inst the ~3. 9% revenue take rate, the business faces two key expense lines that drive its transactional margins: transaction processing cost and fraud losses: Figure 6: F’08 Revenue and Expense Drivers for Aggregate PayPal Payment Volume % of Total Payment Volume, Aggregated across all TPV and Funding Methods 4% 3% 2% 1% 0% 100% of PP rev enue 30. 9% of rev enue 1. 19% 7. 4% of rev enue 0. 28% 61. 8% of rev enue 3. 86% 2. 67% 2. 38% 2. 38% Rev enue Take Rate – Processing Ex pense – Transaction Losses = Transaction ProfitSource: Company reports, J. P. Morgan estimates Processing expense is driven by funding mix PayPal’s profitability is driven in large part by the mix of sources from which customers draw funds in order to pay on PayPal. In particular, when customers pay using a credit card, PayPal incurs a significantly higher cost of funds than when customers fund a purchase using their PayPal balance or an ACH transfer. 9 Imran Khan (1-212) 622-6693 imr an. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009Specifically, PayPal, similar to any merchant that accepts credit cards, is charged a variety of fees (the largest of these is interchange, which is the fee charged by the cardholder’s bank). For PayPal, we believe these fees amount to ~220-250 bps of payments funded with a credit card, with the range representing different types of cards and different geographies (interchange fees are generally higher in the US than across parts of the world, including Europe and Australia). Fees are slightly lower, but still in the 150200 bps range, if users choose a debit card rather than a credit card.By comparison, a payment funded from money already in a user’s PayPal account carries virtually no cost to PayPal. A payment funded though ACH carries a flat processing fee, usually less than 25c; this represents less than 40 bps on an ave rage PayPal transaction of $62. Figure 7: PayPal’s Funding Mix Merchant PayPal collects take rate (~1. 9% to as much as 5%), based on merchant volume and location (significantly higher if currencies converted) PayPal If funded via If funded from user’s PayPal balance, cost to PayPal is negligible Credit card, cost to PayPal is ~220-250 bps; PayPal then functions as Merchant in Fig. above. If funded via If funded via ACH, cost to PayPal is ~$0. 10-$0. 25 Debit card, cost to PayPal is ~150-200 bps PayPal’s cost of funds becomes more favorable Source: J. P. Morgan 10 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 Drivers of Funding Mix PayPal allows users to pay with both a credit/debit card and ACH; however, PayPal defaults to using an existing balance or ACH, and users must actively select to pay via a credit/debit card every time t hey use the service.The company has noted that customers generally shift toward a more favorable funding mix over time. Additionally, as PayPal adds new merchant sites, users of those sites begin with a heavier mix of credit card use. The mix for a merchant site begins to resemble that for PayPal overall as users’ familiarity with PayPal grows – generally, 12-18 months. Additionally, we believe BillMeLater, which is funded entirely through checks and ACH, can help improve funding mix for PayPal down the road. Other Margin Drivers PayPal margins have historically been in the 20% range, excluding corporate expenses.We believe several factors drive the variance between the 60%+ transaction margins and the high-teens overall profitability. Primary among these are: †¢ Customer service costs. Call centers as well as a variety of employees needed to manage any problems that arise in the payments process. We do not expect these expenses to show meaningful economies of sca le as the business continues to grow. Sales and Marketing. As PayPal has invested in growing its Merchant Services business, we believe that segment’s growth has been fueled by higher Sales spend. When the business matures, we believe there should be some scale economies in Sales. BillMeLater Basics PayPal acquired BillMeLater in 4Q’08. The service allows users to request transactional credit, rather than a revolving credit line as is the case with a credit card. BML offers consumers rapid credit decisioning on the basis of less detailed information (date of birth and last four digits of a Social Security Number) than necessary for more traditional financing. The majority of BML’s revenue is derived from consumer interest payments and fees, as shown below: 11 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 Figure 8: BillMeLater Econ omics as of Time of Acquisition % of TPV 12% 10% 8% 6% 4% 2% 0% 2. 4% Merchant Fees + 6. 5% 3. 6% 2. 9% 3. 4% 2. 1% 4. 1% Cust. Interest Cust. Fees – Acquisition ; Income + Credit ; Cost of Funds = Transaction Profit Serv icing – Fraud Loss – Source: Company presentation, J. P. Morgan estimates Note: Cost of funds includes an implied cost of financing consumer receivables; transaction expense for processing funds is minimal due to funds being sourced primarily via ACHAt this point, BillMeLater’s presence on the eBay site itself remains minimal; the company has placed a 3Q’09 target for better integration of the business with PayPal, and we believe that, after fuller integration, eBay may choose to drive higher BML penetration on the Marketplaces business through, e. g. , promotional or interest-free financing. Complete integration of BML into all aspects of the PayPal solution is expected in 1Q’10. Charge-offs BillMeLater reports its net cha rge-offs as a percentage of the average receivables balance over the course of the quarter; in Q1’09 net charge-offs rose to 8. 95%, compared to 8. 5% during the part of the fourth quarter after the acquisition. Due to the transactional nature of the business, we believe BML has the capacity to continue keeping loan losses at a reasonable level; additionally, the company has expressed that it plans to focus on being more conservative with offers of credit in the near term, even at the expense of TPV growth. Nevertheless, we expect charge-offs to continue rising somewhat. Historically, credit card charge-offs have been correlated with the unemployment rate, as seen below. 12 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 Figure 9: Historically, Credit Card Charge-offs Rise when Unemployment Rises 10% 8% 6% 4% 2% 0% Q1'95 Q1'96 Q1'97 Q1'98 Q1'99 Q 1'00 Q1'01 Q1'02 Q1'03 Q1'04 Q1'05 Q1'06 Q1'07 Q1'08 Q1'09 Unemploy ment Rate Source: Federal Reserve, J. P. Morgan Credit Card Net Charge-off Ratio While we believe charge-offs at BML can be managed better, due to the transactional nature of BML’s exposure, we think rising unemployment is unlikely to leave the business untouched. Thus, if unemployment keeps going up, we would expect continued upward drift in charge-offs.PayPal’s Growth Strategy PayPal’s original growth engine was the marriage between PayPal and eBay, and the ability to drive higher penetration on the eBay site. We believe the low-hanging fruit in this regard has largely been gathered, but room for growth still exists along several areas of opportunity. 1. Growth Opportunities for PayPal on eBay Continued Geographic Expansion Can Drive Growth One of the biggest factors driving higher PayPal penetration on eBay has been geographic expansion in territories where the business is less mature than in the US.PayPal has had approximately five years of operating history in much of continental Europe, compared to nearly a decade in the United States. Table 3: PayPal Penetration as % of Addressable TPV continues to Grow % of addressable TPV Country US Canada United Kingdom Australia France Spain Italy Germany 2004 64% 60% 49% 7% 8% 5% 7% 2% 2008 80% 79% 74% 47% 43% 37% 36% 15% 2011(E) 84% 82% 81% 72% 61% 57% 56% 39% Comment Could see add’l boost from BML Penetration already nearly 60%; see below In terms of online activity, much of continental Europe is following in the footsteps of the UK, but several years behind.Penetration nearly doubled in F’08 alone Source: eBay Presentation, J. P. Morgan estimates We believe the 2008 experience in Australia, where PayPal penetration went from under 40% to nearly 60% over the course of a year, is reflective of eBay’s capacity to grow penetration via rule changes: the company rolled out rules mandating most sellers to offer PayPal as an option in 2008, and penetration grew by more than half over the course of the year. 13 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009Figure 10: Australia Demonstrates PayPal’s Capacity to Quickly Boost Penetration 60% 50% 40% 30% Q1'08 Q2'08 Q3'08 Q4'08 Source: Company presentation, J. P. Morgan estimates Additionally, several continental European countries have seen growth roughly in parallel since the rollout of PayPal in much of continental Europe in summer 2004. We See Limited Opportunity for Domestic on-eBay Growth Having already achieved notable levels of penetration on established sites, we don’t think PayPal will see significant additional increases in on-eBay penetration from current levels, especially in the US.However, as eBay increases the amount of buyer protections and begins to offer credit through BML, we thi nk the percentage of GMV that is addressable by PayPal can rise. Figure 11: PayPal volume as a % of Addressable GMV, 2008 GMV in $B 30 20 $29B $24B 10 0 79% 41% US Source: Company reports, J. P. Morgan Pay Pal Non-Pay Pal International One additional way to increase penetration on the site is for the company to offer increased incentives for sellers and buyers to choose PayPal as the payment method.These incentives can take the form of carrots (coupons, higher levels of protection) or sticks (e. g. , rules making other forms of payment more difficult to accept). PayPal has continually increased buyer protections on eBay for uses who pay with PayPal, with the levels rising from $1,000 to $2,000 in January 2007 and going up again to offer unlimited coverage in June 2008. We think offering higher levels of buyer protection – but only when paying with PayPal – remains a useful lever for increasing the penetration of PayPal on the eBay site. 14Imran Khan (1-212) 622-6693 im ran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 PayPal on eBay: Challenges Weak Marketplaces Growth Will Negatively Impact TPV Growth In line with recent declines in GMV, the percentage of PayPal’s TPV that is driven by on-eBay activity has been steadily declining in recent quarters, with 3Q’08 having represented the first quarter in PayPal’s history that saw a majority of TPV come from the Merchant Services part of the Payments business.Figure 12: On-eBay TPV Continues to Decline as a Percentage of Total 70% 60% 50% 40% 30% 20% 10% 0% 62% 58% 56% 56% 54% 51% 49% 49% 46% Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Percentage of TPV deriv ed on eBay Source: Company reports, J. P. Morgan estimates As eBay has struggled to improve GMV growth and faced headwinds from FX, the on-eBay portion of TPV has seen nominal growth turn negative in recent quarters, a s shown in the chart below; adjusted for FX the last two quarters have seen on-eBay TPV grow 5% and 3%, respectively.Figure 13: On-eBay TPV Growth Continues to Lag Off-eBay TPV Y/Y change 80% 60% 40% 20% 0% -20% 1Q'07 50% 19% 57% 62% 66% 61% 57% 49% 35% 26% -7% 18% 18% 17% 17% 19% 12% -3% 2Q'07 3Q'07 4Q'07 1Q'08 2Q'08 3Q'08 4Q'08 1Q'09 On-eBay TPV, Y/Y Source: Company reports, J. P. Morgan estimates Off-eBay TPV, Y/Y We are currently modeling GMV to shrink by 14% in F’09, returning to slight growth in F’10 with a 1% rise. Even when looking only at non-Vehicles GMV, our model calls for an 11% decline this year, followed by a 1% growth in the next year.While we think eBay has taken many correct steps in improving the competitiveness of its Marketplaces segment, we remain concerned that the competitive environment 15 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 will make it difficult for eBay to reaccelerate growth and reclaim market share in future years. Additionally, we believe the shift to a frictionless eCommerce model is driving buyers to choose fixed-price formats over an auction approach.As this has the effect of moving from a space eBay controls into a much more competitive, multi-channel environment, we think it creates an additional headwind to growth. Cultural Headwinds in Some Geographies In addition to the above, two specific geographic regions have presented challenges for growing PayPal penetration: †¢ In Germany (and Austria, combined, estimated at ~15% of GMV), the majority of online payments are made using bank transfers, and PayPal has had limited success displacing this system. However, as Table 3 (above) indicates, PayPal’s penetration in Germany has been rising.In Korea (we estimate ~5% of GMV), where eBay recently announced plans to acquire GMarket and combine it with its current a uction. co. kr site, the predominant mode of payments is using escrow accounts. As in Germany, we believe penetration can rise over time as users become more comfortable with PayPal. †¢ Given the challenges in these two areas, which comprise approximately one fifth of eBay’s GMV, we believe it could be difficult for eBay to go significantly past the ~70% penetration threshold in the next five years. Bottom Line: We see ~$36B in F’11 on-eBay TPVBased on our current model of F’10 GMV (excluding Vehicles) of $43B, and an assumption of accelerating GMV growth to 10% Y/Y in F’11, we think PayPal’s oneBay TPV could hit $36B in F’11 (implying a 6% 3-year CAGR), with a range of $33B-$40B depending on more or less favorable assumptions. Figure 14: On current trends, on-eBay portion of PayPal would contribute ~$36B in F’11 TPV On-eBay TPV, $ in billions 40 35 30 25 2008 2009E Optimistic Current Model 2010E Pessimistic 2011E Source: Company reports, J. P. Morgan estimates 16 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 2. Growth Opportunities for PayPal off eBay PayPal’s growth through increasing penetration of off-eBay online commerce has been a key component of the business’s growth in recent years. We think the company retains significant runway to add customers. Historically, Focus on Smaller Sellers Due to its roots as a solution for payments on the eBay platform, PayPal has generally seen a higher penetration among smaller and mid-size sellers.This is partly due to the fact that PayPal has no fixed costs to a merchant, whereas accepting credit cards carries fixed costs. For a seller generating $100K in annual revenue, a $60$70/month cost for accepting credit cards amounts to nearly 1% of sales. Table 4: Economics of PayPal compelling for SMB market PayPal Setup fees Monthly Service Fee Monthly Gateway Fee Transaction fee Monthly Minimums $0 $0 $0 1. 9%-2. 9% + $0. 30 None Merchant Processor $0-$300 $20-$50 $10-$30 2. 0%-3. 0% + $0. 10-$0. 50/transaction $0-$30Source: Company reports, processor websites and J. P. Morgan estimates Figure 15: Payment Solutions P a y m e nt s o lu tion s †¢ †¢ †¢ D is a d va n ta ge s re la tiv e to P ay P al Buyer S eller C an n ot b e tra cked L im ite d p rote ction ag a in st lo ss/th eft R estricte d to virtu a l w orld †¢ †¢ L im ite d p ro te ction a g a in st lo ss/th eft R e stricte d to virtu a l w orld †¢ †¢ S lo w se ttle m en t/fu lfillm e n t tim e C ost/tim e of w ritin g che cks †¢ †¢ S lo w se ttle m en t tim e F ra ud riskC red it C ard Joh n Q Pu b lic 5012 345 6 7890 1234 †¢ †¢ †¢ †¢ †¢ †¢ S ecu rity unce rta in ty of sm a ll b usin e ss site C re d it lim its In te re st co sts †¢ †¢ †¢ †¢ †¢ H ig h tra n sa ctio n fee s – p ro hib itive fo r sm a ll m erch a n ts R e qu ire s m e rcha n t b ank a ccoun t F ra ud risk (card no t p rese n t) P ro ce ssin g tim e /co st S e tup co sts W ire (e . g. , W e ste rn U n io n ) F ee s U su a lly re qu ire s p h ysica l visit to ve n do r L im ite d a cce p ta n ce Source: J. P. MorganPenetration among Large Businesses Small, but Growing Whereas smaller sellers were PayPal’s bread-and-butter in the early days, the greater part of online commerce now occurs at larger sellers. This is especially true when one includes online travel, a category PayPal has pursued aggressively: whereas eCommerce has a fairly long tail of sites, the great majority of online travel is transacted at the large providers and OTAs. 17 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009Table 5: Penetration at top 50 onl ine merchants, by geography As of March 2009 Country USA UK Germany France Australia Penetration 42% 28% 16% 36% 60% Source: Company presentation and J. P. Morgan estimates Internet Retailer Data: PayPal’s Penetration Higher with Smaller Merchants Based on data from Internet Retailer, we estimate that 26% of the total sales volume on the top 50 online retailers in F’08 came on sites that accept PayPal. Consistent with PayPal’s past focus on smaller sellers, PayPal penetration among sites outside the top 50 is 39%, nearly 1. x the penetration among the top 50. Figure 16: Smaller Merchants More Likely to Accept PayPal % of internet retailers accepting PayPal, weighted by 2008 online sales Internet Retailer Top 50 I. R. Top 50, ex cluding Amazon Rest of I. R. Top 500 (##51-500) 0% Source: Internet Retailer, J. P. Morgan estimates 26% 33% 39% 10% 20% 30% 40% Note: Internet Retailer does not include travel sites in its rankings The following table summarizes PayPalâ €™s presence (including previously existing BillMeLater relationships) on the top 50 retail sites as ranked by Internet Retailer. 8 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 Table 6: 26% of Revenue at top 50 US eCommerce Sites is Addressable by PayPal 2008 Sales in $ millions Site Amazon. com Inc. Staples Inc. Dell Inc. Office Depot Inc. Apple Inc. OfficeMax Inc. Sears Holdings Corp. CDW Corp. Newegg Inc. Best Buy Co. QVC Inc. SonyStyle. com Walmart. com Costco Wholesale Corp. J. C. Penney Co. Inc. HP Home & Home Office Store Circuit City Stores Inc.Netflix Inc. Victoria's Secret Target Corp. Systemax Inc. L. L. Bean Inc. Macy’s Inc. Williams-Sonoma Inc. Gap Inc. Direct HSN Inc. Zappos. com Inc. Amway Global Overstock. com Inc. Avon Products Inc. 1-800-Flowers. com Inc. Nordstrom Inc. Buy. com Inc. Redcats USA The Neiman Marcus Group In c. Musician's Friend Inc. Blockbuster Inc. PC Connection Inc. Toys ‘R' Us Inc. Cabela's Inc. BarnesandNoble. com Inc. Scholastic Inc. The Home Depot Inc. VistaPrint Ltd. Saks Direct Nutrisystem Inc. Peapod LLC drugstore. com Inc. Nike Inc. Kohl's Corp.Verticals Multiple Office Supplies Computers Office Supplies Computers, Digital Sales Office Supplies Department Store Computers Computers Electronics Multiple Electronics Multiple Multiple Department Store Electronics Electronics Video Rental Apparel Multiple Electronics Apparel Department Store Home Apparel Multiple Apparel Multiple Multiple Health & Beauty Flowers Apparel Multiple Multiple Department Store Musical Equipment Video Rental Computers Toys Sporting Goods Media Media Home Office Supplies Department Store Food Groceries Health & Beauty Apparel Department Store 2008 Online Sales $19,170 $7,700 $4,830 $4,800 $3,642 $3,084 $2,693 $2,600 $2,100 $2,015 $1,993 $1,828 $1,740 $1,700 $1,500 $1,497 $1,414 $1,365 $1,333 $1,209 $1,072 $1,044 $1,040 $1,033 $1,030 $1,016 $1,014 $904 $834 $754 $750 $686 $657 $617 $565 $531 $526 $516 $500 $497 $466 $455 $437 $401 $381 $376 $373 $367 $366 $356 PayPal? No No Yes No No Yes No No Yes No No Yes Yes No No Yes No No No No Yes No No No No No Yes Yes Yes Yes Yes No Yes No No Yes No No Yes No Yes No No No No No No Yes No No BML?No No No No Yes Yes No Yes Yes No Yes No Yes No No No No No No No Yes No No No No No Yes Yes Yes No Yes No Yes Yes No Yes No No Yes Yes No Yes No No No Yes No Yes No No Comment Ended BML relationship after PayPal Acquisition Could leverage BML relationship Could leverage BML relationship Site now owned by Systemax, a PayPal customer Could leverage BML relationship Could leverage BML relationship Could leverage BML relationship Could leverage BML relationship Source: Internet Retailer, J. P. Morgan estimates 19 Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com N orth America Equity Research 26 June 2009 Off-eBay market share of 4. % in F’08 We estimate that PayPal’s $29. 5B Merchant Services TPV in F’08 (excluding BML) represented 4. 2% of the combined volume of eCommerce and Travel spend in that year. Our current estimates call for that number to rise to nearly 4. 9% of the total in F’09. Table 7: J. P. Morgan eCommerce and Travel Market estimates $ in billions Category Off-eBay eCommerce Travel Total off-eBay volume PayPal off-eBay TPV PayPal penetration F’07 311. 4 271. 9 583. 3 19. 9 3. 4% F’08 379. 0 329. 2 708. 2 29. 5 4. 2% F’09E 412. 0 342. 2 754. 2 37. 0 4. 9% F’10E 490. 8 405. 1 895. 9 50. 2 5. 6% F’11E 561. 4 458. 0 1019. 3 64. 2 6. 3% Source: Company reports and J. P.Morgan estimates We estimate that combined global online spend on eCommerce and Travel will exceed $1 trillion in F’11. By our estimate, PayPal’s Merchant services would need to access over 6. 0% of this volume in order to hit the low end of the target $4B-$5B PayPal revenue range indicated by the company. 3. Growth through BillMeLater We see several key effects on PayPal of the 4Q’08 acquisition of BillMeLater. In the near term, we think the addition could hurt profitability, while longer-term, we believe it can become a contributor to PayPal growth both on- and off-eBay. †¢ Minimal near-term TPV impact. BML accounted for 1. 2% of total 1Q’09 TPV.As such, we think it is important to note that the current impact of BML on PayPal results is likely to be somewhat small. Near-term growth likely slow. The company has stated that it intends to be very conservative in its approach to the tradeoff between growing BML volume and maintaining healthy credit metrics. Given the current environment, we believe this will significantly dampen growth in BML TPV through at least the end of F’09. Integration, portfolio losses to impact profits. PayPal’s segment margin in the last two quarters was 500 bps lower than in the same two quarters a year ago. The company has attributed this decline to the impact of integrating BML as well as charge-offs related to the unit’s loan portfolio.Medium-term, synergies become possible. Once consumer credit regains a measure of health, we think the company will begin to use BML as an additional tool to grow business, e. g. , by offering financing to incentivize users to pay with PayPal both on and off eBay. Target is convenience shoppers, not the underbanked. We believe eBay sees BML as an additional feature (or convenience) to attract higher-quality customers, rather than as a tool to expand its reach among customers who do not otherwise have access to credit. This approach appears consistent with the tradeoff noted above of slower growth in exchange for better credit metrics. †¢ †¢ †¢ †¢ 20Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 †¢ Auto financing unlikely to be priority. As noted above, Vehicles sold on eBay have been largely beyond PayPal’s reach up to now. We think eBay sees BML’s core expertise in transactional credit for smaller amounts than involved in a car purchase. A significant expansion of the business to include auto financing seems unlikely in the near to medium term. Impact on margins temporary. eBay expects segment margins to revert to historical trends as BML is incorporated into PayPal more completely (e. g. the company expects BML to be integrated into the PayPal wallet by 3Q; additionally sales teams for BML and for Merchant Services are being merged to give clients a single touch point). †¢ BillMeLater Can Improve Funding Mix We think the impact of BillMeLater in the longer term will be felt most strongly on PayPal’s funding mix: BML does not accept credit ca rds, and as such faces a lower transaction funding cost than the PayPal business as a whole. As such, any portion of TPV that shifts from the historical mix of funding sources to BML will help lower PayPal’s cost of funds. Assuming, conservatively, that PayPal manages the business to have a similar take to the rest of PayPal, we estimate that each 1% shift of TPV onto BillMeLater would drive ~2 bps improvement in funding cost.Thus, if BML were to grow to 4% penetration of our mid-point F’11 scenario of $100B in TPV, it would drive ~8 bps improvement in funding cost: an incremental $80M contribution to the bottom line, or 5c of EPS. Table 8: Sensitivity Analysis: EPS Boost from Lower Transaction Cost as BML Penetration Rises TPV in $B, BML as a % of TPV, EPS impact in $ TPV BML % 87. 1 100. 5 113. 8 Source: J. P. Morgan estimates 1% $0. 01 $0. 01 $0. 01 2% $0. 02 $0. 02 $0. 03 3% $0. 03 $0. 04 $0. 04 4% $0. 04 $0. 05 $0. 05 5% $0. 05 $0. 06 $0. 07 Credit Cards’ P ain Could Be PayPal’s Gain Recently, the House and Senate passed bills restricting certain practices in the credit card industry. We believe that such steps could have several points of impact on PayPal.Crucially, if these rule changes make credit card issuers less generous toward consumers (e. g. , lower profitability drives issuers to lower the levels of rewards for credit card use), PayPal could benefit from funding mix improvement, as the incentives for customers to fund their accounts with credit cards, vs. debit or ACH, would be reduced. Further, we believe that, should credit card issuers try to recapture profitability with less consumer-friendly rules as well as more frequent fees, the quality of the user experience for credit cards will erode, making consumers incrementally more likely to use PayPal. 21 Imran Khan (1-212) 622-6693 imran. t. [email  protected] om Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 4. Growth Opportunity: Expanding Merchant Acquiring Business We believe PayPal currently has two strategic growth opportunities going forward. The company can drive greater adoption of the PayPal solution by continuing to establish PayPal as a brand for online payment, alongside incumbent players such as Visa and MasterCard. Alternatively, PayPal can attempt to improve its payment economics by becoming a scale merchant acquirer. This would allow PayPal to capture the ~30 bps on card transactions that we estimate it currently gives up to its acquirer.Finally, PayPal may attempt to skate along the knife-edge between the two above strategies, maintaining relationships with large acquirers such as Chase Paymentech while at the same time functioning as an acquirer for its smaller client base. PayPal as a Brand Chase Paymentech, the largest merchant acquirer in the U. S. and the largest processor of e-Commerce transactions, offers PayPal as an integrated payment option alongs ide well known names like Visa and MasterCard. As such, Chase Paymentech clients have the option to advertise acceptance of PayPal as a payment type. According to Chase Paymentech, clients that accept PayPal (in addition to credit cards) commonly see an increase in sales. We view this as an important indication that PayPal has potential to be a powerful brand off eBay.We believe PayPal’s recent stated focus on larger merchants suggests this is the more likely strategic direction for the company, as PayPal may not want to jeopardize its status as a partner to the large acquirers, which make it easier for enterprise-scale businesses to include PayPal as one of several payment choices. Can PayPal Become a Scale Merchant Acquirer? In our view, PayPal also has the potential to become a scale merchant acquirer, which could enhance its off-eBay presence, especially among smaller and mid-size merchants. As a merchant acquirer, PayPal would handle all of the card processing needs of a merchant, including directly processing other brands like Visa and MasterCard.We believe PayPal can offer very competitive rates to small merchants (who often pay heavy miscellaneous fees to acquirers), given its scale, allowing it to deepen relationships with merchants and potentially handle offline transactions as well. Smaller merchants (especially the ~87% of US merchants with annual card acceptances under $100K) tend to pay a much higher spread to their acquirer. Whereas such merchants account for ~10% of credit card volume, we believe they represent as much as $2. 5B in merchant acquirer revenue: more than 1/3 of the total revenue in the US merchant acquirer business. We think PayPal’s historical strength among smaller sellers can be an advantage in accessing this market. Chase Paymentech offers PayPal as an integrated payment option for its clients.Chase Paymentech was the largest merchant acquirer in the U. S. in 2008 with 22. 5% market share 22 Imran Khan (1-212) 62 2-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 Table 9: Top Ten US Merchant Acquirers, 2008 $ in billions Merchant Acquirer Chase Paymentech First Data BofA Merchant Svcs Elavon Fifth Third Processing Solutions Global Payments Wells Fargo Merchant Services Heartland Payment Systems First National Merchant Solutions RBS WorldPay Source: The Nilson Report. V/MA volume $567 $293 $283 $181 $165 $93 $91 $75 $51 $48 Market share 22. % 16. 9% 11. 2% 7. 2% 6. 5% 3. 7% 3. 6% 3. 0% 2. 0% 1. 9% As noted above, PayPal currently partners with Wells Fargo when it comes to handling non-PayPal branded transactions. One concern about a PayPal entry into the acquirer market would be whether it could successfully maintain its relationships with the other acquirers who currently offer PayPal as an option, and who would come to view PayPal as a more direct competitor. How Much is PayPal Worth? Combining the outlook outlined above, we believe PayPal TPV will reach $100. 5B in F’11; though somewhat more pessimistic or optimistic projections for the unit’s growth yield a range of $87B-$114B.At the midpoint, our estimate is for a 19% 3-year CAGR in Total Payment Volume. Figure 17: On current trends, TPV on pace for just over $100B in F’11 Total PayPal TPV, $ in billions 125 100 75 50 2008 2009E Optimistic New Model 2010E Pessimistic 2011E Source: Company reports, J. P. Morgan estimates Assuming the PayPal take rate remains just below 3. 9% (and assuming healthy growth in PayPal Marketing Services and Other revenue in F’11), our TPV estimate would result in $4. 1B in PayPal revenue. On the profitability side, we believe PayPal is likely to see segment margins shrink to 17. 2% for F’09 due to the continuing integration of BML; by comparison, segment 23 Imran Khan (1-212) 622-6693 imran. t. [email  protected] omTien-tsin Huang, CFA (1-212) 6 22-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 operating margin as reported by the company was 20. 0% in F’08. We think PayPal segment margins can expand back to above 18% by F’11. Figure 18: Segment income could reach $785M in F’11 PayPal segment operating income, $ in millions 1000 800 600 400 2008 2009E Optimistic New Model 2010E Pessimistic 2011E Source: Company reports, J. P. Morgan estimates Based on our scenarios for PayPal F’11 results, we believe the unit is likely to achieve approximately $450M in Net income. At a 20x multiple, this would yield a $9B valuation. Table 10: Scenario Analysis to Get to a PayPal Value in billions except where indicated On-eBay TPV Off-eBay TPV Total TPV Revenue Segment Margin [Unallocated Corporate Costs] Pro Forma Operating Income ($M) Tax Rate Net Income F'11 Earnings Multiple PayPal Value Source: Company reports, J. P. Morgan estimates Worse Case 33. 0 54. 2 87. 1 3. 57 17. 5% 4% 482 25% 361 16 5. 8 Average Case 36. 3 64. 2 100. 5 4. 09 18. 8% 4% 603 25% 452 20 9. 0 Better Case 39. 6 74. 3 113. 8 4. 61 20. 0% 4% 737 25% 553 24 13. 3 Comparative Valuation of PayPal Unit We believe it is instructive to look at several comparables when it comes to valuing PayPal. Specifically, Visa and MasterCard provide payment networks, while Global 24Imran Khan (1-212) 622-6693 imran. t. [email  protected] com Tien-tsin Huang, CFA (1-212) 622-6632 tien-tsin. [email  protected] com North America Equity Research 26 June 2009 Payments is a pure-play merchant acquirer, functioning in much the same way as PayPal does by providing an on-ramp for merchants into the payment system. Table 11: Comparative Valuation for PayPal $ in billions PayPal $67B 11% 1% $2. 70B 13% 17. 2% Some credit risk due to BML Visa $2,702B -1% 60% $6. 94B 6% 52. 9% None 20. 8 17. 1 15. 4 MasterCard $1,759B -9% 34% $4. 97B 0% 43. 2% None 15. 7 13. 4 11. 7 Global Payments N/A ($93B in F’08) N /A 4% $1. 59B 10% 19. 2% None 18. 4 15. 8 12. 5 CyberSource N/A N/A