Midterm Exam - Term 2 ... and Alta Report!
Nice - a 91 inch base at Alta with 14 inches of fresh POW! UUUuuuuTTTAAAAAHHH!
Well, the midterm exam went as usual, no worries ...
Same old, same old.
The only real difference is the amount of students who will be docked for cheating.
Sigh ...
Tomorrow (Wednesday), I will begin more explanation of the mortgage crisis in the U.S., now that they understand mortgages better. We also jump into the Foreign Exchange market - PPP and the Law of One Price.
I am toying with the idea of having them write a one paragraph thought on the World Bank's proposal to decrease China's GDP by 40% due to PPP. While interesting (to some of you who have written me), I am not sure of the value to them yet ... After all, they are only 19 and 20 years old ... but "ya gotta learn sometime!" (Does that sound like it is going to happen or what!??!)
on a lighter note, looks like the reservations for the Philippines and Oriental Mindoro are complete!
S.C.U.B.A. and beaches here I come.
Another side note - entry number 70 in exactly 3 months, interesting.
Well, the midterm exam went as usual, no worries ...
Same old, same old.
The only real difference is the amount of students who will be docked for cheating.
Sigh ...
Tomorrow (Wednesday), I will begin more explanation of the mortgage crisis in the U.S., now that they understand mortgages better. We also jump into the Foreign Exchange market - PPP and the Law of One Price.
I am toying with the idea of having them write a one paragraph thought on the World Bank's proposal to decrease China's GDP by 40% due to PPP. While interesting (to some of you who have written me), I am not sure of the value to them yet ... After all, they are only 19 and 20 years old ... but "ya gotta learn sometime!" (Does that sound like it is going to happen or what!??!)
on a lighter note, looks like the reservations for the Philippines and Oriental Mindoro are complete!
S.C.U.B.A. and beaches here I come.
Another side note - entry number 70 in exactly 3 months, interesting.
Six months ago, the Bush administration quietly eased some restrictions on the export of politically delicate technologies to China. The new approach was intended to help American companies increase sales of high-tech equipment to China despite tight curbs on sharing technology that might have military applications.
But today the administration is facing questions from weapons experts about whether some equipment — newly authorized for export to Chinese companies deemed trustworthy by Washington — could instead end up helping China modernize its military. Equally worrisome, the weapons experts say, is the possibility that China could share the technology with Iran or Syria.
The technologies include advanced aircraft engine parts, navigation systems, telecommunications equipment and sophisticated composite materials.
{ International Herald Tribune}
Should China be treated differently because it may not be so rich after all? That is one of the central questions raised by new calculations from the World Bank that suggest the Chinese economy may not be as large as previously thought.
The World Bank issued figures that recalculated the economic output of 146 countries, including China, after excluding differences in domestic prices and currencies.
The calculations of so-called purchasing-power parity, which compare the buying power of citizens around the world, put China’s output at roughly 40 percent less than the bank’s previous estimates.
The calculations help explain how Chinese workers can make ends meet by earning $100 to $250 a month in export-goods factories in Shenzhen.
{ NY Times }
READ MORE >> economics, asia | 0 Comment January 9th, 2008
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Leuchen: A very interesting question - How does the U.S. treat China and does the Administration need to treat the Chinese differently "now that the Chinese economy may not be as large as previously thought."
China now produces about 60% of their products for internal consumption (I do not believe these figures include all barter trade, by any means, or production/consumption by rural people, which still constitutes the majority of Chinese).
In the U.S. we currently consume 70% of our own production, therefore China is a much more internally oriented country than Japan will ever be, for example. However, China is a "Mega country", to coin a term: 20% of the world's population live in China. Therefore, while the level of their economy may be smaller, their growth rate is still phenomenal and unprecedented! Furthermore, the growth rate shows no signs of slowing and the Chinese government shows increasingly encouraging signs of understanding market economics!!
Case in point, the Chinese are now appreciating their currency to calm inflation. The government has also stopped export subsidies on many goods and even prohibited some exports. Not to say that China is yet a free market economy, I don't believe the government wishes such an economy. Therefore the name: "Socialist Market Economy" and the desire for a harmonious society (perhaps the Chinese government may characterize our free market economy as chaotic, especially with the current troubles). In addition, the People's Bank of China's monetary policy is attempting to slow down the rampant investment loans to a more manageable level, with interest rate increases AND required reserve increases, much like in the U.S.
Most Chinese could care less about the World Bank's categorization and calculations. The Chinese are too busy trying to learn and become wealthy. For example, the statistics on ownership of stock in China are mind boggling!! More "average" Chinese citizens own stock than you may expect!! Furthermore, they are growing their income handsomely with these investments! The level of China's economy is a topic mostly for academics and pundits, in my opinion, and interesting fodder for the newspapers to proclaim. China has not changed because of the recalculations and to think so would be folly, in my opinion.
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You failed to address the following:
The World Bank issued figures that recalculated the economic output of 146 countries, including China, after excluding differences in domestic prices and currencies.
The calculations of so-called purchasing-power parity, which compare the buying power of citizens around the world, put China’s output at roughly 40 percent less than the bank’s previous estimates.
The calculations help explain how Chinese workers can make ends meet by earning $100 to $250 a month in export-goods factories in Shenzhen.
Answer me that Econodrew...
Anxiously awaiting your reply.
Leuchen
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Dear Leuchen:
If am very impressed that you have kept up on the economic concepts that the World Bank is employing to compare countries. It is
definitely true that purchasing power parity (PPP) measures tend to give a better long-run exchange rate comparison than simple
use of current spot exchange rates.
However, the World Bank's calculations do not affect the buying habits of people, only calculations of relative "parities" between countries.
The Chinese workers probably do not have a clue that the World Bank even calculates such a thing as PPP per capita GDP. They
are too busy working to eat food and buy clothes. I will tell you that eating here in Shanghai usually costs less than a dollar a day but
one can splurge and spend up to $2! I might even spend $3 on one meal, but I am not Chinese, let alone a worker in Shenzhen.
I would bet that most Chinese never even batted an eye when the Chinese Press published the news in English - I do not know
if the statistics were even published in Chinese. Therefore, I believe the Chinese workers still have just as tough a time now as they
did before the World Bank published their calculations.
Now if you want to hear them complain, just ask them about the price of their favorite food and how high inflation is in Shenzhen!! That
will get you an earful plus!!
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I do not know if the statistics were even published in Chinese.
I am willing to bet they weren't.
btw? Iowa legislature is still battling the smoke good/smoke bad thing.
Hard to ban smoking after increasing the taxes a buck a pack a year ago and reaping those benefits. Oh, and by the way? Leading opposition comes from the casinos. Imagine that... you do the matrices....big grin
LOO Chen
Leuchen
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