A Review of Joseph E. Stiglitz Article ‘China Century’ (Vanity Fair January
2015)
Professor Joseph E. Stiglitz opens his essay in (Vanity Fair, Jan. 2015) with a laconic 18th
Century English rondo, (1) “When the history of 2014 is written, it will take note
of a large fact that has received little attention: 2014 was the last year in
which the United States could claim to be the world’s largest economic power.
China enters 2015 in the top position, where it will likely remain for a very
long time, if not forever. In doing so, it returns to the position it held
through most of human history.” China he said will likely remain in ‘top
positon’ ‘for a long time’, ‘if not
forever.’ We suggest that this point is more of a punch line than a main
focus, a hyperbole perhaps, but rendered in Economics is a combination too far.
Looking at the basic outlines of his essay and how he roved from statistics
showing that China has superseded USA in GDP, he moves into an argument about
the politics of Washington, which based on our knowledge of his opposition to Washington
Consensus may be suggesting that he was perhaps right that Washington needed to
moderate its official policy in several parts of the World. His essays are
hints of justifying the rise of China, a case in point that can be taken on a
face level in other to understand Beijing
Consensus. Stefan Halper (2010) Beijing Consensus is an evaluation of China
new roles in world economy that some of its vital are creating alternatives to
West and America and giving developing Countries reasons to try something
different. That the only problem which many have not taken seriously is whether
or not Chinese Authoritarian rule can in the long term be considered a major
challenge to business as we know it in Africa and in Europe.
This forever may or may have started in 1999, but it will be too
difficult to deny in 2014 that the last 15 years or the roaring 2000’s has not
being a Chinese Decade.
Perhaps 1997 was the beginning of
the year of the Chinese, for if we look at the problems in Asia in 1997 and how
the Russian economic debacle in 1998 affected South East Asia following the
fall of the Bahr, perhaps statement by Joseph Stiglitz following the survival
of China in the 1997, that it emerged ‘valedictorian’
of his class, could set the pace in understanding why the issue of ‘saving glut’ as put it in 2007 was
comparable to ‘production glut’ (deflationary), the initial he considered the
bases of ASEAN countries to have any form of scalability and hence hard hit
from unnecessary external pressures. What Stiglitz suggested was that Asia and
particularly China, should spread their savings of international basket around,
put the currency basket into use, perhaps to avoid what I called Price
corruption, a promotional argument regarding to happens to too savings, too
little credit and long distance economic theory, perhaps the same in economic
and financial interpretation. US owes China over 1.5 trillion dollars, almost a
whole 10% of a good year’s GNP, more like saying that in this year or next, if
China owns 10% of US Economy with or without their 2014 performance or 2015,
it’s really a China GNP plus a 1.5 trillion, and in the words of Sebastian
Mallaby, should China decides to call for their equities in US, 6 months
instead of 9 months, it called set Wall Street all of over the place.
Since their inception into the
World Trade Organization in 1999 and the coming of Europe as of a Formative
Union or the ECB, China as an Old Giant has more than played a leading role in
world markets. How well the forgotten Empire holds the belt is a question of
strategy they plan to use in shifting from Communist economy to free and open
market economy. As we should acknowledge by now, that all political
institutions is a step towards free and open economy. It is perhaps exemplified
by capitalist economy, but form all account of history, it is not exactly the
same as free market, does not mean that open and regional based economy of the
world is also a step towards this reality. The question that has occupied the
minds of people is when will a new force capable of rivaling the United States emerge?
And what would the world be expecting from this power house? Never perhaps in
the last 20 years would be said and argued that the force to coeval the
Americas, buried for decades under the pile political militia was China of
mainland Asia. The reality of their aspirations could in fact be said to have
matured, for when the world woke to a China that surpassed the United States,
it seem like a quite storm with greater marvel to perform with constant
revisions of its exchange rate.
In 1999, nearly at the eve of the
European Union (probably the greatest single economic mistake since Britain
attempted after the First World War to return to the Pre-War Standard), an
article by the US Secretary of Labor appeared of the Economist, where she
argued against the role of government in directing the economic affairs of a
Nation.
According to her response to OECD
titled ’Government Steering the Economy’, that two disadvantages of government
intervention is that “one is that government is not omniscient despite all of
those clever economists, it lacks the knowledge to steer and control the
economy it pretends. The other is that, like any large organization, it is
inflexible. Once a course has been set, it is hard to change.”
To make the case legible, Eric
Wiener (2010), (Shadow Market) threw enough light on “…in 2000, America
companies raised $63 Billion from initial public offering, while Chinese
companies handed in just $19.4 Billion. But in 2009, U.S companies picked up
just $15 billion from initial public offering, while Chinese companies brought
in more than $35. At the end of 2000 twenty five of the world’s fifty largest
companies in terms of the market capitalization were from America, and only one
was from China. The largest company in the world at the time was General
Electric. But by 2009, twenty-one of the world’s fifty largest companies were
from America, and none were from China. And the biggest company in the World
was PetroChina Company. In 2000, there were 298 billionaires in the United
States and 79 billionaires in China….” Weiner asked if we are ‘noticing the
trend.’ The trend of a business growth in China is not new, how well they are
measuring up to US is not new, but when as he mentioned in his book that $1.5
billion was moving from Beijing Financial District which is a 35 block radius
(jioejinilg) transferred in 2003 or so, from Xidan North District, to the so
called ‘Gold and Silver Street’ by the nine
road (Boulevard) at Xicheng District Beijing. What Weiner did not mention
is that over the same period, about $1 US billion was moving from US alone into
China and not even counting Europe (EU) and their IMF whose late actions are
the reasons why there was so much paper currency at Chinese Holding.
Weiner mentioned something familiar
with Stilglitz, that China gave ‘concessional loans’ to some African countries
and ASEAN was offered some assistance by China and towards a better
Transatlantic Co-operation. But in the names of Marshall Funds (Marshall Plans)
for Africa, China has acquired more infrastructural projects in Niger, Angola,
Sudan, and Ethiopian so simultaneously that the billions they made from
Nigerian Crude oil after the first few years of drilling, does not compare with
the multi profits and billions China made simultaneously from each these
countries they offered loans and bi-lateral assistance. These deals by the way
were initiated and completed by both English and well-spoken Chinese women and
others ‘beyond suspicion’ to make these deals possible. Although they made
their initial home in Nigeria for many decades including during their communist
reign and isolation in the 70’s and 80’s, that the first carpet and textile
industries outside China were built in Nigeria through a Taiwan partnership,
that it was Nigerians – not Lebanese who came later and through Detroit – that
brought Chinese to most parts of Africa and helped them negotiate for
Government contracts, China dumped Nigeria overnight for South Africa, calling
the Naira thrash despite the fact that in 70’s and 80’s the Chinese unaccepted
currency could be traded in Nigeria. Put it clearly the objection to some of
CIC acquisition in Nigeria and Ghana was due to some this new development of
their personality in business; China bow to the next master whose head may be
worth the efforts. This is not tarnish their image in Africa and elsewhere, but
in so far as they good conscience and graces are concerned, Nigerians can tell
you better, that it is better to understand these people and act along them
than accommodate or vilify their business practice.
Among the top Banks which now
occupy a healthy spot on the world biggest banks include (a) Industrial and
Commercial Bank of China (ICBC) with net 3, 181. 884, followed by (2) HSBC
Holdings (UK) with net 2, 758.447 and then (3), China Construction Bank
Corporation (China) with 2, 602.536 in trillion terms. Occupying (7) and (8)
are Agricultural Bank of China worth 2, 470. 432 and Bank of China with net
worth 2, 435.485…. The US banks that once dominated the markets including Bank
of America came in 12th with 2, 149.851 trillion dollars, J.P Morgan
Chase and Co, (6th) with 2, 496.900 net worth, and Citigroup Inc.
(US) occupying (14th) boosted their worth with a slight increase of
1, 894.376.00. It is remarkable that in less than a decade, Chinese Banks or
even one China Bank is worth more than Barclays, let alone Royal Bank of
Switzerland, or in this case, 4 Chinese Banks fairly and easily rank ahead of
RBS. How could it all have happened? Perhaps the cultural age of China gave way
to the Industrial reality and as they move from home front to global market,
the world saw explosion of growth that they have never seen since the Muslims
and their Islam turned the world – most of it – as their footstool.
I cannot disagree with Stiglitz on
his tutored analysis of the Chinese
Century, which should be taken seriously in spite of its gaps and actual
grappling with reality, head to tail with US, China has more people than the US,
tail to head Chinese population ratio to US is three times the Americans if not
four. Why do we parry a China who only lately after long and exhausted currency
rotation and Government spending and world isolation now meets us at the market
place with both hands full of it. It is not clear how to proceed on this
matter, for if argument about clashing reaches a new level of political
indication, we may let on but doesn’t seem like the chain of relation between
new and old empires yielding to the new is suggestive that China is a new World
Order.
Nothing best a country’s unified
ability than the Production Frontier that allows it to play a bigger role in
its estimate of global view, nothing in the world of business that divides and
conquers a people that the new demands of market free from external oddities of
everyday super power presence. Unlike the 80’s and the quarrels over a
Washington D.C and its America that has done more than many of its past empires
to spread development around. The damages done to Africa did not begin with
America or did it end it until Obama. Sudan for instance was a waste basket on
murdering stampede, where immigrants with Islamic devoted background were
chanting that God gave them Africa, re-entered Sudan or South of Egypt and has
exercised murderous ramparts in what is still Darfur. Washington D.C played a
lip service to this development in Darfur, like Britain which ruined a lot of
African countries over Crude oil, placed Gadhafi in power over the natives who
ruled Libya and controlled with interest much of the Crude oil from Libya until
President Obama was elected. In Egypt, the story is not that different, Mubarak
remained in power longer than necessary and only by attrition was asked to
leave office especially when President Obama denied him the support asking him
to make his transitioning. In Congo, there was said to have been a civil war
between some expatriates and the Congo military which lasted for decades, the
first light of settling the problem came through an ex-Nigerian President
Obasanjo, but the whole division remained in place until Obama whose lack of
support for the expatriates discouraged further assault on the natives. But at the buck and sheen on the process of
conflict in Congo is the whole sale pricing of Congo’s most priced assets.
Millions of lives where crucified
in the names of military expedition with world breathing terror on the neck of
even neighboring African States such as Mozambique, Tanzania, Botswana, and
Rwanda; where at the instigation of two French expatriates – perhaps robbed of
some of their treasured resources or forced out of it by military, took down a
presidential jet that led two tribes suspecting each other into long and bloody
massacre in 1994. Over 1 million of these people died in fewer than 2 days.
Somalia for many years remained the clutter and enemy state said to be opposed
to United States, and in Angola there was disquiet in almost every political
era beginning with Crude oil discovery, the UNITA Rebel forces in Uganda were a
problem in Africa until the election of Barack Obama. Almost a year in office
all these headaches came to a grinding ends. These circumstances of politics and
political is not a summary of the defective prowess of Washington Consensus,
but it mirrors the debt between an overall position of a state and their
reactionary tendencies to the rest of world, from the individual issues between
US and places such as Venezuela, Cuba, and Mexica to an extent, that these
areas were considered problem areas and the US Government made their cases for
and against these South American States, that eventually decision to oppose the
United States lived a short death with Barack Obama. Since his office, these
United States has not quarreled with these neighbors and some of the cracks in
the relationship with middle east has long been repaired, saving the problem
with Palestinian and Israel and the Syria as a bottom fork of Russia presence
in that part of world. It was the British that instituted the current Syrian
house, the British that helped to stabilize the house of Saud who took their
mantle of leadership from the natives who many would believe live in these
areas. Here’s the point, at no point in the history of America has American
been any richer in their possessions than now, at no point in the history of
the Americans have enjoyed the size of influence we have now where America is
the only Super State for nearly two decades. At no point in the history of
America that the current Economic rewards any bigger and better than what we
have. At no point have we seen American Banks and Insurance companies commonly
operate in several parts of the world than these decades past.
No country could say that it was
directly responsible for saving Europe, one, twice and more than three times,
forgiven debt and resources from Marshall Plans to the very recent debt
cancellation of American monetary exposure to Europe. Over a trillion in 2012
was written off from mark to market American financial credit market. US single
handedly delivered Greeks from their debts, lavishing over 2 trillion dollars
when all parts of the non-performing EU markets such as Portugal and Spain were
also pardoned of their Debt. In fact, the buckle of world relationship was so
much that the country has to borrow more and for the first time, extended and
now recovered from a promise they have maid. In latterly days of Lehman Saga
which the Professor hinted on, there was no a billions every day – A Billion
Dollar worth of Securities – leaving the US to China every day through the OTC
for at least a few years leading to the problems with Investment Market. It
does appear the interesting position of the Washington Consensus which though
opposed by Professor Stigltz is depended on those in power and the merit of the
executive psychology. For no case would separate Washington D.C from what is
Beijing Consensus that the problems of DARFUR, which then and now divides and
bridges Sudan, for here, in one area, the Chinese and the zootomic India fresh
from buying away parts of Tanzania with world’s greatest land real estate, were
no longer content on dictating to Tanzania – An African Country – were now
interested in partnership China in removing the natives from Oil Rich areas of
Sudan in other to migrate small sources of energy back to China of Yesterday
and India of today. George Clooney had some clue on what happened in DARFUR but
the debt of the problems and why American needed a new leader summarized
America from a different era. We take this theory of Consensus with new
beginning as If from the old, that the theory of China being more moderate in
several parts of the World is perhaps not correct, they are and some historians
of the Vietnam will tell partly driven by their ideologies but largely newer
from views that are no longer at ease with China today, yet stuffed with the
past is a new reality which they have not acknowledged. That new reality is
arriving, since now they lead the world as the most productive economy,
The Washington Consensus which is
now under fire, perhaps from Professor Joseph E. Stieglitz
2….
In Thomas Karier’s
‘Intellectual Capacity’, we discover a man by Joseph E. Stiglitz, the 2001
Nobel Prize winner in Economics, who was for over two decades an outspoken
critic of IMF International Policies. Stiglitz argued that IMF’s method of
lending was ‘outdated’ and ‘counter-productive’, that IMF was responsible for
stunting economic growth in the world. Thomas Karier explicitly described
Stiglitz position on IMF’s policies that “They have adopted what was called the
“Washington Consensus” that called for Austerity Measures like balanced
budgets, reductions in government subsidies, and less regulations of Capital
Markets, in order to encourage more foreign investment. Stiglitz thought that
the indiscriminate application of these policies often made economic condition
worse.” And with particular reference to Ethiopia, Stiglitz argued that IMF
’cookie-cutter’ economics will be looking to put a hit on Ethiopia through the
so called Austerity Measures. Thomas Karier continued that a conflict between
Stiglitz and the sound generality of IMF’s policies continued over a period of
time and became apparent over the conflict in Middle East Asia. In Karier’s
word responding to East Asia crisis he said that IMF responding to East Asia
crisis, “…demanded the usual Austerity Measures; higher interest rates and less
government spending. The result was painful as unemployment more than tripled
in Korea and Thailand and food rioting broke out in Indonesia in response to
cuts in government subsidies.” Stiglitz, according to Karier had earlier
objected to the policies, citing that it is ‘counter-productive’ and ridden to
error, and “He pointed out that the countries that rejected the IMF remedies,
like Malaysia, recovered noticeably quicker.” In due sense Stiglitz advocated
‘for an alternative approach more consistent with the theories of John Maynard
Keynes’. Thomas Karier mentioned that the point was particularly persuasive
since John Maynard Keynes was the architect of IMF, which originated in 1940 as
a means to ‘stabilize international finance’, and the creation of ‘World Bank’
for ‘economic development’. We may need to however indicate that Keynes
approach is ‘Austerity of Treasuries’ and not by Interest Rate Hike. The only
pike in the world of argument now reside around what Keynes meant by government
spending to accelerate growth. That answer was attempted by Joseph Stiglitz
when he rationed that debt default can better handled by market acts that
recognize the sovereignty of laws guiding nations of World Market and at the
same time, offering economic incentive.
As we shall discover, these
remedies which the two giants in their rights advocated for, may never be
sufficient in dealing with economic crisis, and for that it fails to
incorporate the real practical problems of economic debt default and formation
of crisis in economy. The issue of Rating is one in a certain direction, a
direction we shall discover to be dangerously close to Banks and other
financial institutions, since Mortgages are involved and therefore require a
better understanding of the micro-economics involved. Why are Micro-economic theories
ineffective in handling problems of regional economy, where Radius of Axis may
have easily applied, but failed to interpret the cause of such failure, and
then the baby milk remedy of Keynes and his group of supporters. This view of
preventing regional economic implosion has today a major representative in the
Vice of Robert Mundel. Based on the many debt restructure and economic
resuscitation of Europe, we begin to entertain that Europe may still be a
victim of old tools, which no longer has any benefit for the credit drive-in
society. In words of say Robert Solon, we wonder the basis of Savings in
deciding economic policies of the world and why we dragged equilibrium into. By
that we may then suggest that the main event may therefore include the study of
the formation of crisis with particular respect to Europe as both an
institution and a currency unfolding, and we try to understand the Challenge of
a Greek Palaver.
It is increasingly clear that all
economic theories may be reduced to the study Inflation, hence a study of
‘Inflationary pressure’ as opposed to Inflation Expectation which is the
application. Therefore Inflation Targeting – both the spot rate and the range
is the primary occupation of many central banks, a failure of this same exercise
is due to the disappearing inhibition of Banks in asset investment and
financial institutions.
Joseph Stiglitz in his 2006 ‘Making
Globalization Work’ enhanced his position on faulty International policies that
may prove detrimental to the society and not the other way around. His usual
attack also came by way of IMF and this time, he took a position on Russia
1988. That Russia is rich in mineral composition is not out of the question,
but Russia being part of International Market, was affected by the incident of
1988, where the fall of crude oil played so crucial a point. In Stiglitz we
learn that just as a company’s book show the ‘depreciation of its assets’, so
too should a ‘nation’s accounting frame work reflect the depletion on its
scarce resources’. He went to describe that IMF in devising their policies,
demanded high interest rate from Russia as condition for assistance. In his
words “...when IMF encouraged or even demanded that Russia have high interest
rates as condition for assistance, that too may have had political
consequences, and for those who had gained control of Russia’s wealth were not
profitable, and those who had gained control of Russia’s wealth were provided
further incentives to strip assets.” That is saying in one language that association
of IMF (or even World Bank) with Russia Oligarchy – which evident in style to
New York City – they further helped the country to undermine the rule of law.
Joseph E. Stiglitz summarized by saying that “what IMF did mattered more than
what they said, they weakened the politics of reform by ignoring the effects
that their politics had on economics and political behavior.” Adapted from
(Onwuka, 2011; Greek Palaver 2011)
That analysis concerning how a new
force emerges is macroeconomics and general to a fault. But then we may
consider the transition strategy between Turkey and France and the reversals
suffered by the French in Russia robbing them of that first place among the
Eagles, we may see that the reasons for such action may have opened the way for
Britain to militarily enhance their leadership position in the world. It was
finally achieved through a final act and signature victory over the French,
performed with fanfare at Waterloo. Since Waterloo or beginning at Waterloo,
the rise of Britain – particularly England was well underway. We may not
suggest that the shocks suffered by England and through English people in the
WWI and WWII, prepared simultaneously the way for America. The greatness of
America in terms of its cultural entity and industrial power began with local
revolution, culminating in the Civil War. What we have learned from this age
was applied in several forms and throughout the country with such septicity
that 1900 would perhaps be called the final birth of the American might. Like
China or should it like Russia, US was even among the most powerful nation by
1850, while they were not military tested saving for reactionary wars against
Indians and the European interest and forces, Americans were feared for their
productive ability since they manufactured nearly all the initial cheap
materials at this period in the world, but later and with greater magic they
yielded to the culture of perfection made most clearly with IBM machine a
century later.
Now as then, the new forces of
change beckons on the world and China emerges are a competent Champion and as
Asia’s diorama lynch pin for economic progress, seem to have passed through
much the same period of internal restructure and reproving to a period of rapid
and nearly cheap alternative. This period like the most recent examples of
Russia and United States, transition to a period of active and prolific
production, changes somewhat and may be challenged by perfection and sensitive
A class material which has enabled China transition from cheap alternative to
equally with purpose be an alternative that allows China to revile the rest of
the world. We have not forgotten what China went through and either should
China forget that their expectation of justifying the years in isolation is solely
and automatically reverting to this first class position. They are
manufacturing first class student at Harvard and University of interest in the
world. Shanghai is still number one leading mathematics PICA/PACA rated place in
the world. There are not too far behind the leaders in Chemistry, they lead in
other areas of discipline including. There are fewer countries in the world
with as many Chinese engineers are there are workers. But this is not only a
case for their first class position; their human capital alone is better used
elsewhere.
Let’s face it that out knowledge of
manufacturing from production is serious, our knowledge of industries and
growth of industries in is quite demanding in Economics, that a separation
between these two requires the experts in the discipline to explain or some
kind of an end point of its final products to explain. This end point in
employment which production and not manufacturing is primary. It leads us to
consider the role of unemployment in normalizing inflation which is here
shifted or exported to foreign market through compulsory return of workers once
considered unemployed or under-employed. It seems easy and perhaps easier to
suggest that the use of Chinese 10% compulsory unemployment towards
distributive practice () of continued employment as a trick to constantly
recycle free from meeting an equilibrium and then a stagnation like the one
suffered in Russia through 60’s and 70 and are perhaps approaching the same
thing, China achieves this gap with an 8-10% compulsory unemployment mitigating
equilibrium in local market - whereas I
on my independent account believe equilibrium is really not possible perhaps in
free market conditions – for with China and an economy dogged by price control
and a central planning committee, this equilibrium is ideally possible,
possible as with the use of dummy variable and advanced mathematic computation
in economics.
To have an economy for instance
where everybody is working with intent at achieving direct and equal balance of
trade – a communist market illusion, more political than economic -, working
with the total intent at micro-netting an estimated gross from a final product,
is an economy that will fully satisfy its local demand bracket, has no need for others
and only itself, such a poison to itself even like a Russia where demand and
supply within demand supply, such a market with its predetermined legal tender
and without effective foreign export market should not be trusted. Such a
market if be Russia, China, or any BRICS with little opulence to world market
in spite of the excesses of FDI leads from permanent money dozing and dousing
on its Russian and China numbers to a new market totally different. Russia was
a strong market afraid of something, exposure given the levitating energy it
would seem to be drawing or have drawn from other places of the world. Such a market may also suffer from a second
problem, the problem that China is concealing and should allow to face, is the ‘natural
treatment’ of free market through competition and alternate choices arises,
where the local formative energies of a balance of budget arises, balance of
trade triumphs, trade commission that will protect free market emerges,
individual and private disequilibrium which only the choice function even for
public utility can assure.
Why production is important in the survival
of a nation it is the ability of the Government to create employment or labor
through its allocation procedure that makes the difference and remains for
Communist economy a tool for determining the growth of the economy. But the
underlining fact of production is that it can used by the government and its influenced
labor complex, it is dependent on the direct activity of the Government, like
the primary levels of Philips Curve and NAIRU (a name mathematical fundamental
to quantity of money and real term employment, can serve as a legal tender and
replace the Nigerian Naira. There are several things that can go right and
wrong with a first level of unemployment numbers but attaching NAIRU to money
and to legal tender measures its relative conscious expenditure to availability and
total quantity) which suffers an increasing quantity when a barrier is
reached, shift from labor and production to full employment and expenditure the
propensity to spend or save, ends up creating inflation. It is the second stage
of NAIRU that governs the correlation between inflation and price, where
inflation becomes equal to price.
Productive frontiers are one the
major economic drive-ins in the world. When there are cases of depression
economy or recession, any country in crisis usually turn to expansion
especially in the form well known today as monetary expansion for aggregate
demands. These are items associated with production capacity which encourages
employment and from the appreciation in employment, there is a long term change
in the behavior of fixed income earners (Friedman), and the tendency to spend
usually gravitate towards inflation. To show that this form of economic
practice is not confined to Capitalist economy as a way of explaining its
purpose in Communist China, we begin by reminding ourselves that price and
manufacturing go hand and globe, that in terms of inflation which is usually
self-generated but not ultimately endogenous, it is common sense to place the
arguments of Hyman Minsky concerning the role of central bank in creating this
inflationary pressures. In other words, between production and manufacturing is
a cadre of interest rate lending, that feeders the cost of final products which
in spite of the variance of market action and activity, tend to move upwards
than downwards. This particular niche in the market (not niche market) is a
careful analytical procedure that means that a certain form of production
should be avoided to micro-manage the issue of excess returns of profit, though
necessary for growth in the economy, may also be instrumental to its failure
over time. Once more, we look at the argument made by Milton Friedman that long
term wages do not always correlate profit.
As such in the arguments of Minsky,
there should be a way of offloading the inflation which are sometimes
unavoidable, by looking at the external market and balance of trade or trade
deficit. Largely, the problem of ‘Unstable Economy’ is due to what he called
‘slave’ attitude of the Federal Reserve System in dealing and putting with
actions of the Banks, whereas the interest rates set aside by the Banks do not
always account for overall national GDP. Why his arguments are plausible and to
some extent accurate, it reflects the actions of the Communist party and
neo-Communist China in excessing production pro economy, which does with issue
of quantity of money – nearly akin to a Mises economy and the Austrian School
that accept that Savings was essentially part of the investment and account for
their overall GDP, but by having a kind of central body which helps the growth
of the market it sets itself to close to central planning body, a communist
body similar to Socialist but ethereally different from Socialism. We there
suggest that having a set a premium for the price of production of goods is not
without the future market for exporting to other demand and supply outside say
a China, the rest of the would be revert to this productive curve of the
Communist or central planned economy that the profit or growth of these economy
aside the human capital is a set of mathematically determined equations and
price theory that nets a predetermined profit without the inflation which
accompanies the function of any market.
A Made in China proto-type is
usually set to offset a competition, but what it is really doing is shift
inflation from China or Communist economy to the rest of the world. As such, we
may make due with commitment showered on this process by how much money is
perhaps flowing from different parts of the world to China and Chinese Banks.
In the 70’s there was hardly any such resources, in the 80’s when Americans and
the British took advantage of the uncertainty in China market to channel their
resources, China experienced a major bulge in the Banking and finances, with
some of the investors thinking perhaps of asset bubbles and a penetration of
the yet to be discovered market. What was known and perhaps taken for granted
was the cultural severity of China and its disciplined commitment of being the
first economy which is 15-25 years from now - given the current facts.
We cannot only make insinuations
about Minsky as a man advising a proto-type that it practiced in Unionized
economy and in China today, but his fault, according some of the assumptions in
the quantity money theory, is that production hubs are different from each
other, correlating a country’s export potential to say a US usually allows it
to earn more, but getting from the value which this US of A can bring to a
bifurcated nation, usually takes a different length of time. One of the more
demanding changes that can take in the economy is the transition from
production hub to economy powerhouse, which begins with enlarging the A game of
this host nations, especially through allowing the free market determine the
value of the currency and the strength of the economy, something A China may
have to do if in entertains any hopes of being among the eagles. Here, China as
a consumptive economy is delayed by the exchange rate, determined in part by
the IOU greenbacks re-entering the US through the Hong Kong market, determined
in part by the expense driven expansion of the central planning committee and
above all by allowing the Global economy determine its actual value misplaced
perhaps under the current climate of the condition.
Money system or the History of
Monetary Policy considered a ‘black box’ of Economic theory by Samuelson and
has been praised by many experts for empirical resource and use of statistics.
Its premised argument differ on the levels of the expert, but looking it from
books also written by Milton Friedman and Anan Schwartz, especially ‘Two Lucky
People’ possible his best book, you escape the book with some basic understanding
that price and bond markets divide on the role of the Federal Government and
the that a general theme on Riemann Integral, as X approaches Y and distracts
from X, each capable of leading each other but not exactly meaning. In between
the Bond/Price integral is the quantity of money and role of Government, which
as some argue may stating really do not matter as long moral obligations is not
betrayed. How this happens and when it happens is the basic themes about
destabilizing power of the Federal spending and actions of the Banks.
Most countries in the world cannot
exercise this option in economic theory largely for the role of inflation (the
DNA of Economics) which comes with any version of full employment whereas wages
and prices are argued by communist and central governing authorities to be
negligible if ratio/rations parallel the needs of a system dynamic. However
long and visceral the description of work- based rational of money is
concerned, that is final product by Karl Marx is a kind of money, mitigated on
by Irving Fisher who called it interest rate, it does appear that price which
is inflation belong entirely with open market and consumer economies of the
world, real economies which is constituted by both active inflation and
interest rate, production on one side and manufacturing on the hand, the latter
a product of a market; consumer economy, which China and Russia is not .
It looks like the primary problems
of a communist economy is inflation, which they can avoid through a propensity
to equilibrium by constantly recycling the propensity through compulsory
unemployment, at least I have argued, an 8-10 percent of the total balance
sheet. But in terms of price determined
by market, the role of manufacturing is far more paramount then the role of
production. It does not mean that these two forces exist in isolation given the
surplus theory where a primary
concern of a capitalist economy is the need to balance budget and close the
gaps on trade deficit. Consumer economy is based on existing market function
and through price, which differentiate from employment consumer economy. Inflation
from manufacturing by chasing a different market….
Arguable, the Chinese currency is
still satellite for the United States for practical reasons that it is not yet
an independent economy, and like Euro that chose to be a satellite to US than
compete as a sun which the French, German, and to some degree Italians were
before the EU, China pegging its worth to US re-plays son and father
relationship, where America is the father or mother here or at least a laity
uncle. By age, and in the years that China played the ‘signifying monkey’ to
the rest Asia and then the world, China is higher pecking order, but there was
no such United States in those days, as such the role that America enjoins
today is the role that is not new in Asia and through Asia; China like previous
empire has been there and more than twice. It still leaves with the lessons of the
past or the past makes for us; the path is the language of ‘Consumer economy’
for no magic exist for the rise of US than the consideration of a new market
order from production to dictating the market to deregulation and setting their
own standards, and an economy that as much part of its ability to produce as it
is a market economy determined by price and manufacturing. Evidently speaking,
it is only America that can regard itself as a Super Economy, that part of the
reason why this needs to be said is that it comforts the rest of world that
there is assurance with confidence in current global market, both of the words
‘assurance’ and ‘confidence’ look alike, may also sound alike, but compared
much closely and from original intent of the author, some assurance in practice
if not markets is all driving by meeting a baiting standards and surpassing,
speaks to what happens when there is market estimate at say an NYSE and the
traders preach on one thing and by the end of year actually achieve it.
Confidence is a question of history
from tried and tested experience, for instance what is the confidence Chinese
numbers are accurate and true? The only response to this practice of confidence
is that Chinese are sometimes full of their characters, yet there are more than
one too many instances that their numbers came from elsewhere. In real life,
anyone can lie to avoid social conditional of some sort, but nearly no body that
it matters in world market is a zero-sum
game since anybody make up their corrective measures on what really sells and
how their profits are derived including Newman and Simons sacrificing effects,
only in my view necessary when the standards are the same for all cases of
economic respect.
It is not the role of the Government
to decide the economic future of any society that Government may intervene but
the problem is that when mistakes occur in the course of running any country
and in the decision making process, there is a long bias associated with it.
For all trades which the rest of world has more than indulged since the Brent
Wood, the impact of organizations such as the OECD (Organization for Economic
Corporation and Development), EEPA (Employment and ECONOMIC Policy
Administration), NAFTA (North Atlantic Free Trade Agreement), GATT (The General
Assembly on Trade and Tariff) – which comparable to NAFTA, ECM (European Common
Market), NAB (National Association of Business), and older organizations such
as IMF (Internal Monetary Funds)and (WTO) World Trade Organization and to some
extent ECOWAS, has mainly forwarded world market in one direction, has
delineated the scalability of the functional markets, and has more than awarded
interested parties with the unfair trans-border advantage. These organization which emphasis bilateral
agreement between governments take on added meaning when the comparative
advantage of Supply end economy is set a function of its demands.
There is a second theme here on
Bretton Woods since the outfit that compose the house on which IMF is built is
this Bretton Wood. It looks like IMF (International Monetary Funds) also
inherited all the proposals on building economic theorem, comingled by recent
Robert Mundel and Harry Johnson about a transitioning from a dictator economy
or centralized economy not unlike the Communist economy with all brightness for
future years, downcast on state and national monopoly and enterprises, shift
from these government control to private control; the privatization scheme, to
decentralizing the economy, leading to the opening up of the local market to
all the agents of free markets and market systems. The last stage is the more
insufferable and may be advised against the burgeoning strength of a new China
that as much the world need new consumer economies and that China should
de-regulate some of its rules, it may not attempt this overnight. The
transition into a real economy is necessary for China mounting this mantle. It
is not clear how the world would still take China, yet my advice to their pack
of wealth and money masters and mistresses, whose jobs has superseded
individual expectations and wealth accumulation is looking at the what happens
when you target of an 8-10% growth is served by a recycle of the 10%
re-employed, yet in constant mark to market
demarcation between the an exchange rate such a US dollar to Chinese
RMB, of even 1; 13 from beginning reaching to what is today, shows that the
profit margins do not truly reflect the mathematical equivalence of estimable
10% growth, meaning that China is extensively overproduced, a condition that
will become available if and when it shifts from current exchange rate to
something less steep to US. There are ways to encourage a healthy redactor to
Chinese 2000’s, a redox from recycling is one, placing enough emphasis on energy
is important especially the deals with Russia’s gas and petroleum, but
neglecting the spurious advise of a Buffet to move the exchange rate upwards or
keep it as is for a reasonable period, it’s enough to encourage a new
definition of economic and capitalist depended market.
These kind of economic environment
has never in its history produced any fair or respectable business lead it has
manufactured casualties by creating standards that are only within the grasps
of multinational corporations. This in-turn flood Open Market Systems such as
the U.S (technically the only real market) with Hot Money, Human trafficking
(Natashas), drugs, bugs, persons of Interest, and merchants of death. The border between Mexico and the United
States during the NAFTA accords is a well-studied and cited example, the extent
to which human beings will be willing to go to partake in greener pastures, all
of which is not said to reflect the velocity of currency between an always
struggling Mexican Economy within the Shadow of U.S market. The example is
removed from the formal economic problems facing Mexico, that the advantage of
playing Satellite to super state is from the beginning an error. The rest of
world from Europe – especially Eastern Europe whose depth of poverty is only
recently public – to Asia; both the big elephants of India and China, to all
extent Japan and the other Tigers, are resolving the fate of their currency
around with Interest pegged to the United States dollars, jettisoning on the
local adjustments fitting for International Markets, and hoping through the
bifurcating to keep the productive tag to consumption a case of U.S versus the
world.
When he mentions that it is not without reasons…
(2) “The world economy is not a zero-sum game, where China’s growth must
necessarily come at the expense of ours. In fact, its growth is complementary
to ours. If it grows faster, it will buy more of our goods, and we will
prosper. There has always, to be sure, been a little hype in such claims—just
ask workers who have lost their manufacturing jobs to China. But that reality
has as much to do with our own economic policies at home as it does with the
rise of some other country.”
(3) “Second, if we ponder the rise of China and then take actions based on
the idea that the world economy is indeed a zero-sum game—and that we therefore
need to boost our share and reduce China’s—we will erode our soft power even
further. This would be exactly the wrong kind of wake-up call….
This is total opposition to Washington Consensus.
Stiglitz, (4) “A new global political and economic order is emerging, the
result of new economic realities. We cannot change these economic realities.
But if we respond to them in the wrong way, we risk a backlash that will result
in either a dysfunctional global system or a global order that is distinctly
not what we would have wanted.”
These economies which defy all the
‘principles of economies’ will not exactly function at least with a view at
profit without the background of a trading business partner from a consumer
based market economy. Social economy exist to some advantage by its pairing
with other economies of the world, does not mean that only form market
considered optimum for common market economy is capitalist, it makes a separate
case that there is working progress in terms of all markets and all system
dynamics, that they are primarily concerned in providing as much access as
possible to the market place, that markets pursue this destiny as a matter of
consequence. The argument is meaningful if we add that the role of economist is
to explore the limits of profits and price advantage that accompanies a change
in business dynamics from one form to another, of for disequilibrium or company
and individual a based transition, it is estimate of the total profit from
total amount of investment when new products are manufactured from old. The
fall of Berlin Walls and the inception of East European countries in the world
market unveiled the depth of losses associated with an economic Iron Curtain.
For all the intent of argument, it
leads to several view point and considering the fall of Russia as a complex of
its economic Paradox, such an economy, projects outward strength – it is
government controlled – it bleeds from poor domestic restructure, anemic of its
recipe. The issue of intrinsic value being the value placed on price over
product tend to suggest that returns are more powerful than investment which
cannot be said to be any different from investment preferred over returns, both
lateral approach useful when we playoff long-term goals against short-term
goals, or Government macro-based economic indexing from dues ridden to changes
in private operational markets; bond as affected by bank stocks.
The failures of Communist economies
to close ‘Vega’ adjusted gaps between the Stock and Bonds as driven by the
market direction and procured by the leadership factor of the first and future
market, is not without doubt the reasons for the general collapse achieved in
the first place that brought down the Communist Russia in the 1990’s, a
generation that was not prepared for the pressures were unleashed to the
challenges of a New Standards.
“Since investment is the backbone
of productivity, the productivity gain in the United States is much smaller
than in Germany and Japan.” “Huge federal deficits and debt kept the interest
rates higher in the United States than in Germany and Japan. As a result,
American companies were at a disadvantage in borrowing for investment vis-à-vis
their competitors.” (1) Manufacturing (2) construction (3) retail….
Russia then and now has little
operational room for growth. It was never a leader economy; it was a
reactionary economy entirely dependent on a structure that existed with or
without purpose in Europe and in US and it was accustomed to its own devices it
led nowhere but downwards like old company without external challenges. If
Eastern Europe from the ink of Bernanke’s student support that prices at a
pre-arranged showing is allowed to reproduce its own curve in the open market,
the host market lack the stress and strain to adjust to the external pressures
or open competition. The movement of Government owned companies to
privatization as scheme perpetuated by the IMF running against the challenges
of Europe in post Marshall Plan of the 50’s, there are hints that the
involvement of these strategies now injured with the region single market could
benefit some of these former European economies.
The debt gaps from Eastern European
gives and in out on why the issue of domestic strength raised by Porter may not
easily be achieved without Government policy and Government control, may not be
achieved without tampering from external market but nowhere confined to
Government consensus such as Washington’s, and not entirely opposed to Beijing
Consensus who cannot occupy the leadership position of world markets given the
level of their overall transition to capitalism; money for money sake, profit
determined by the markets or exchange of goods or price as function of the
markets. Inflation and inflationary pressure accompany heavy Foreign Direct
Investment, the total amount of foreign currencies entering a new capitalizing
market usually break the back of small and pedestal local rate of return, it
manufactures reasons why there the bigger and more powerful economy leaning on
the boundary or trans-border economy achieves new challenges and with the
Shadow banking ever present with special privileges, there is a shift to Real
Estate buttressed by the inflation adjusted Government Bond. Banks empower a
healthy bicameral.
(5) “Consider the so-called Trans-Pacific
Partnership, a proposed free-trade agreement among the U.S., Japan, and several
other Asian countries—which excludes China altogether. It is seen by many as a
way to tighten the links between the U.S. and certain Asian countries, at the
expense of links with China. There is a vast and dynamic Asia supply chain,
with goods moving around the region during different stages of production; the
Trans-Pacific Partnership looks like an attempt to cut China out of this supply
chain.” But this not the case, nowhere confined to the case and to a large
extent….
The Moratorium for International
financing initiated by Henry Kramer of Stein school of Business, which told
from the pages of Obama Banks and the financial regulations from 2008 financial
collapse, is angst against the shadow financial practice of leading investors
to end of economic investment, with investment from Internal Specie Banks such
as IMF and the World Bank which are directly owned as if private owned by
multinational bank corporation. American Banks until lately were not reasons
too clear stipulated by the New Deal on the 30’ and of 42’s, would authorize
American Banks to participate in International lending without penetration of
these U.S banks. Although these banks evaded these Seagull Act, some of their
actions were public reasons for world be investors to take canvass on the
landscape of American Business practices. What was common to Japan, to Europe
following the formative IMF was permissible in the Americans. But until lately,
these practices have remained the corner stone of many economic nations, especially
in the aftermath of Bretton Woods.
Stiglitz (6) “Yet another example:
when China, together with France and other countries—supported by an
International Commission of Experts appointed by the president of the U.N.,
which I chaired—suggested that we finish the work that Keynes had started at
Bretton Woods, by creating an international reserve currency, the U.S. blocked
the effort.”
Glass and Steagull is one the
reasons why the Bretton Wood accords did not go far enough into US, especially
the role America played in rebuilding Europe after WWII. The Marshall Plans for
Europe which was partial equilibrium or what Kenneth Galbraith under John F.
Kennedy would consider ‘special interest’ zones, essentially a page from
Harvard School of Economic than Chicago, regarding a late and reversed version
of Pareto optima. A special interest zone was effectively used by Deng Xiaoping
following the analysis of the Russian Communist Collapse and the advice from
his mainly Harvard trained economists, both from Asia and from United States.
Of course, the short story is that Communist China emphasized Shenzhen region and
Shanghai as a way to defray the problems of purpose in the central planning
committee. But many of the problems associated with Special Interest zones is
that they are usually the central focus of the economic empowerment and
development, hence they receive the highest attention, betraying the CPI
equilibrium format and of course the
problem of panic when a tipping point is reached. To have an international basket at this point
may be difficult to maintain since the forces at work are driven by International
Standards. China without marking distinctions does not respect any Bretton
Woods accord, or would have respected it.
If we compare China from its
earliest days as an experimenter in Communism, it looks to suggest that they
and Russia were part of the principle reasons why International basket failed.
To iron out an International currency basket we need all the participating
economic communities to account for their products and their currency. We need
them to work with specific International Standard to effectively insure free
market play in the overall market of the World. Communism didn’t respect this
financial consciousness, could not have, hence, the impact of China in breaking
World Standards and Markets should not be awarded. China hedged their local
expansion and transition through inflation, relied heavily on supply chains
with entrenched monopoly creating a false progress by failing to expand
elsewhere, are seeking to penetrate the markets around the world, and through
Industrial Unions, are hoping to tag the Renminbi to Greenbacks via Taiwan. All
Asian miracles suffer the same sickness as if the ‘ends’ no longer justifies
the ‘means’, that the adjustments to supply economics which is left to
Government is in effect a poaching of International markets. From U.S
historical rear-view, we may compare the historical atlas of the Depression Age
and the problems that U.S was by circumstances of the era forced to deal it.
The problems of NRA and the efforts created by the organization towards standardizing
the business codes which replaced the parity of the goodwill Government
spending, is to a large extent no different from Government sponsored projects
in many parts of Asia markets.
In some sense, China is some
experiment largely for the precautions against toeing the lines of Japanese
miracle, which placed enormous and almost singular faith on U.S market. The
China miracle is not without the advantage that US market offers, for sure,
China has avoided the holes in the evolution of Japan as a market world power.
The only difference between Japan’s productive measures which superseded the
70’s and the 80’s and Japan as a world class economic hub, the shortfall in
Japan’s future market expectations from the 1990’s, till the moment that it is
no longer the brighter Asian technological spot or Japan taken that seriously
given its interest rated force implied to the rest of world, as its shift from
local manufacturing to financing, from production and employment where a
natural level of unemployment occurs, to production in the context of X, Y, Z,
where exports from Japan approaching equilibrium forces it to take in products
from other parts of the world. Japan is still straddling between a production
hubs to manufacturing hub, the latter is limited to inflationary considerations
of parallel markets with US and its bifurcation directly amount of products
hitting the Americans or the Europe.
In my estimate and a historian of
higher latitude than Keynes, I could point that over-emphasize in any one key
area of total consumption economy is perhaps a leading reason for its decline
and fall. Inflation may be a DNA for the studies in Economies, but the sugar
complexes for inflation is not really supply of money as per Friedman and
Fisher, it is placing too much emphasis on a system dynamic within the CPI,
that is generating more attention than necessary. In the words of Stiglltz, he
added that (8)“And a final example:
the U.S. has sought to deter China’s efforts to channel more assistance to
developing countries through newly created multilateral institutions in which
China would have a large, perhaps dominant role.”
These citation is affirmative of the Professor Stiglitz’s opposition to
Washington Consensus, which places an executive summary of his argument somewhere
between International basket and Global market as the basis on economic
transformation of any country, which also lend some idea to where he stands
with China away from well stated demarcation between the Capitalism and
Communism. In this case, the markets have long replaced their overall
productive interest and the question is how these groups achieve their final
visions in the world. Perhaps the man opposition to Washington Consensus is a
form re-view of what Washington should be doing, perhaps Washington Consensus
was very different from Monroe Doctrine, perhaps it was not respected in
Washington or elsewhere.
In a sense, there are material
reasons why U.S has inveighed against the financial subduction, it is in the
interest of the least dispassionate observer to take in the gaps in undue
financial practices, a point which a certain Paul Weyrich in his call for Moral
Majority, his Political Council and the Heritage Foundation will raise towards
the Transparency of some of the Banks practices, especially Banks which unlike
U.S, are government owned.
The Heritage Foundation and the
older organization such the Council for Foreign Relations may have prodded the
famous argument made by John Williamson in 1989 termed as a Washington Consensus which (1) ‘imposed
fiscal discipline’ (2) ‘reform taxation’ (3) ‘liberalize interest rates’ (4)
spending on health and education (5) security property rights (6) privatize State-run subsidies (itself the corner stone of all the doctrines
since it torches on the SAP; Structural Adjustment Programs, popular in many
third world) (7) ‘deregulation of the market’ (another issue of dissent between
the SEA; ‘South East Asia’ and West) (8) ‘adapting to the competitive exchange
rate’ or more to so, permitting world markets to determine the price of local
currency (9) ‘remove barriers to trade’ (10) and remove barriers to Foreign
Direct Investment. These doctrines are not new but seem to reflect the barring
limits of a State Sponsored economy whose true value cannot be called a
‘function of the market’ and therefore represents a false growth and economy
and in 2014 at least, it can be argued as a crash of the free markets system
with much world essentially parasite to these West Economies particularly
United States.
The excuse for comments of this
nature is set to appeal to the economic school of discipline that opposes
government intervention, and the foremost institution called the Chicago School
did not mean to deter the government from participating in the affairs of the
any economy, rather it forbids the general tendency of the government towards
control of its market through spending. This where China is, especially in the
new accounting standards available and mainly used in China, or what they call Chinese numbers and not characters. A
Chinese number is temporary market condition and formatting, that is mainly
used and accounted for by Chinese and for Chinese, including the spurious
problems of digital money, that is money paid directly into State Owned Bank
accounts to individual names and merit. But who doesn’t like the Chinese, a
permanent cog in the furniture of human beings. If we toe the arguments of
Stiglitz here, we can see that he may or may not have lived in China for any
long spells of active time, does not mean he has not lived in Asia especially
Japan. Both the Chinese and Japanese are nothing compared to Indians, the
latter is slow very Indian but a lesser patriot than Chinese and Japanese, the
former lazier. They hardly work in China it is something you learn gradually
but there is action beyond your comparable imagination. Compared to the Chinese
we find in downtown New York the difference is night and day, and most of the
Chinese that suffer themselves to hit the Americans are usually those not
politically or militarily connected. In proper light, the comingled themes of
China as a world power in market is reasonable, but as an economic world power
is in my view and from experience not exactly accurate. The poverty rate in
China is a third world category, believe in this story that there are more
Chinese people starving than are Africans, but of course people starve in India
or Asia generally than they do in Africa. This does not mean that the people
are not productive, does not mean that the production frontier is not in their
favor especially when there are cases of production to be made about China than
manufacturing indexing and its price theory which put them in spite of the new
numbers put China above the United States.
We seem to connect some of the
assumptions about the conversion rate of 5 Chinese Renmibi to US dollar is a
drive-in for the sudden surge in market value in China. Why the road in
business than leads from exchange rate to the damage house of business in a third
world, always leads from a damage house to prosperity through exchange rate.
The only difference is the production curve of the economy or the production
frontier on the country at the receiving of the exchange rate prairie. China
magnifies its agenda from the visions it has for the new world and for over a
century, this faith is not misplaced given the position of the new numbers. With
more of the Chines currency approaching a 4 ratio convertible barrier, they may
have removed themselves from the problems of moderation to a new reality of
being the most productive economy in 2014, usually a telling sign of a quick
and silent revolution that may lead in a decade or a quarter of century from
here-on to economic powerhouse.
There are lots to be admired about
the productive power and disciplined process which is their chief secret, but
the cultural revolution that gave birth to this new China is a revolution that
more than adequate share of administration of process and government that will
take at least 25 years to end. Being a production hob does not mean an economic
power house, (1) most countries in the world do not trade with the Yuan, a
possible that could change anytime (2), Single currency as not measured as part
of total export market, is some of the reasons why there are problems of
grasping between what a production house and hob such as China is, that it
dependent on returns on prices in entirely differently economic environment
hence a matter of manufacturing, is a pacesetter for economic exchange via a
new money order which the Yuan will introduce.
If we choose to compare the
privileged authors of this period for instance Naill Ferguson and his ‘Ascent
of Money’ is no doubt a theme from Alan Metz ‘History of the Federal Reserve’,
where in the very last pages he struggled to mention that the Ascent of Money
was a reflection of phases of Capitalist economy with its setbacks and
triumphs. Books on the ‘Olive and the
Lexus’ by Friedman were not doubt coveted from a similar book treating the same
topic but unlike Andrew Sorkin’s ‘Too Big to Fail’ which feathered Paul Volcker’s
‘Too Big to Fail’, the elaborate conception of a state sponsored Bank and the
idea that some banks were too big to fail is not a principle that is compatible
with US in the 70’s with rich oil success or the triumph of the big corporation
in Third World economies where in the names of Foreign Direct Investment,
countries such as Venezuela, Mexico, Brazil, Argentina, Nigeria were overtaken
by Shell Corporation with the indirect
backing of IMF. The final product of
Bank or creation of Banks too big to fail place several head shots on IMF,
making it difficult for Bretton Wood to last – that is assuming we have a
relevance to the new ideologies of China.
It is here that Joseph Stieglitz
opposition to Washington Consensus is essentially elaborate for his argument
these financial institution acting in the names of Structural Adjustment
programs or International association such as the GATT – mainly associated with
Japan – paper out these third world economies who in the names of Progress
privatize their Third tier market to the detriment of both the local economies
and the Foreign Investors that are sometimes deliberately over-weighted on
struggling markets. It is natural course of world market to experience periods
of losses and profits, and it is an old theory that for every concave in the
graph of any a dynamic system, there is perhaps a convex someplace else.
II
Considering the wealth of history
available to the better ends of Europe at the close of the 19th
century, where Prussia succeeded in defeating France in 1870 and the
persecution that followed including the direct injury to the subdued minority
in Prussia and eventually Germany, it is not surprising that German at the beginning
of the 20th century produced the difficult economic theories of Karl Marx and
Frederick Engels, and the varying schools of economics in names of Austrian
School, all of which carefully emerged as a cultural reaction to the problems
of Government intervention, to a degree that the salutation of Communism by
Marx prophetic premise of the future of workers uniting with no prospects of
losses than their ‘chains’ does not betray the impact of Patronage economy and
receiving peonage, on no other count but those of profit to one group and
losses of another. It will be in Russia and in some sever parts of dilapidated
Turkish realm that the reversals on what considered Capitalism would take its
roots and from these angels it is not wrong to suggest that the role of
Government in deciding the economic fate of any nation is…not.
But this theory about the losses
and gains and the trade through a recycle of unemployment and inflation is
probably not true. What means the conceptions of Marx on Communism as a form of
economist practice could not be apply in real market circumstance, for the
basic themes of haves and have not(s) which parade his Das Kapital was not an
accurate diagnostic common market, and theory applied to its time was not only
false but it was also misconceived economic theory. It is not wrong that those
who are find the Das Kapital appealing were tellingly from lower ebb of the
Society, some of the Chief proponents included Lenin and Stalin were actioners
of little economic opulence, were variously tried in the attempt to redeem
themselves from the perpetuated authority of their royalty and came to accept
revolution as the only bullet out of the box.
It is not to suggest that Karl Marx
was not accomplished theoretician and we are not expected to play folly to
pressing problems of his Jewish people reduced to Ghetto and the messianic
hopes of a better years which saw some meaning in relieving the Government the
powers to decide the Market, yet in the difficult vise of the limits of his
application, his was then and now a political revolution with no place for
money and market. The ethereal fact that losses and profit combine to outfit a
common market is not true, the claim which some Economist still repeat that
concavity of one its convexity of another is not true, at best the realized
attempt to underscore to the failures of Russian Communist exercises by Chinese
Students is in spite of its originality quite original to Russia and Soviet
Union that losses can be offset through a compulsory unemployment and losses in
the local market can be trade-off through expediting the demands of one society
by securing what they needed most, the most important needs of a province if
truly established is expected to differ with some alternate province in the State.
It was the State that determines
this range of demand and measures the limits of expectations in achieving the
least possible for one province or the most for another as opposed to its
expense. The Generality of distribution – no theater for price distribution and
Savings theory – falls short of exactly promoting that the in real time
economic conditions losses and profits essentially apply, but only to some
extent as they apply to the Broad Index but on a whole, the nature of wealth of
nations is one that is comfortable with the growth year on year. It is possible
to grow your business with as much losses and profit, single digit only to the
limits of participation but on the whole several well managed companies over a
period of time do not shed that others will earn, they earn and growth
simultaneously.
Here the premise of losses is
applied only to a single banter and appeals to individual conceptions of one
market which crushed under the difficult weight of ruling class is set to
escape the obstacles by the dreams of a perfect union of Government and market
which does not exist saving for oversight.
The Chinese Communist revolutions
were done by poor people and general uneducated class but a different meaning
under the leadership of enlightened but misdirect leaders….From Marx it is the
final product from the effort of a first rate worker that determines the
quality of a product. He is not blind to the forces of market is forcing price
movement but this to him would be secondary or essentially an alternate system
which should not replace the quality of a product through the hands of a
worker. The Lenin-Marxist theories that were preached till late in the 70’s
Nikita Khrushchev and by his General Sectaries in early part of 80’s by backing
the formative GOK died a sudden death with the rise of Labor Unions in several
parts of World.
The imperative of having Marshal
Tito of Yugoslavia promote a loose orthodox Communism held a different meaning
when applied to the impact that Unions will later have in Yugoslavia, hold a
‘Global spatial’ meaning in interpreting the problems of economic structure
with the impact of the Unions who become so tall in a local or domestic market
that engage under the pretenses of cheaper alternatives, strange and foreign
markets where the transfer of capital was no longer a consideration among the
subverted class, but the transfer of a worker’s product from one region to
another determines the wealth basis of a nearly super rich. What many regard as
the end of the Reagan administration or the Reagan economics as a period of
symbolic American strength and end of the Cold war, was in many ways the
beginning of new forms of economic activity, metered by the structure of
workers Unions – AFL-CIO (American Federation of Labor and Congress of
Industrial Organization) which had its moments after the end of World War II,
Working in concert NRO, etc, were able to finance international referendum that
empowered cross-border trades, cross-border transfer of Industries and
factories, and in the end gave new birth and new meaning to the chain of
causality leading and facing America in 2014. It is NAFTA of Salinas as
buttressed by Henry Kissinger and Cyrus Garvey (?), Salinas adapting the
prospects of the NAFTA under the garb of Tito, yet swelling on its living
verdure the trunk of socialism with one eye on America Industries and the
second on the limits of public intelligence.
These extremes of Industrial
accounting; in separating the Domestic
themes of say a founding father; Alexander Hamilton and his Reports on Manufacturing, the division
wrought by the cheap products from oppressed and enslaved South and the
problems of prosperity on the backs of a Ricardo and the lavish theory of
Comparative Advantage.
In this opening indictment of the
wealth of error involved with NAFTA – itself a prosthesis of GATT, is that it
took American Politicians of highest acumen – Gephardt, Gore, Bradley,
Clinton(s), and Bush of ‘Bipartisan Oligarchy’ of the late 80’s through to 90’s
to affirm the understudied Doctrines of NAFTA. For all we care about the 1993
organization of the treaty, we may or may not forget the efforts put in by far
reaching New York Council men and women who in the persons of Sal Albanese to
mention opposed the Treaty noting that it serves several purposes much of which
was essentially negative. The transfer of American Industries to Mexico was a
lease of life which fated the 1994 disasters in Mexico which led to a million
workers losing their Job in combined oil crisis and companies shut downs due to
Tariff and embargo commission and in petered outcomes gave impetus to Hunt
Commission.
The equal measure of this transfer
may have taken a new meaning from the attempts to undo the damages of NAFTA but
more than the damages, it is the role of the Union Workers who held monopoly
over the life and fortunes of its members and in New York more than anywhere
else, the imbroglio of Sweeney who earned a few strips in defending workers in
the earlier incarnation of the 70’s, remained a clog in the wheels that opposed
NAFTA and in the end signed on a treaty that did not add the merits of
Comparative Advantage with Mexico Debts (100 Billion at 1993) and the
conversion rate of almost a 3, 000 pesos to a dollar. It was a fraud from
beginning to the end, the end was no nowhere confined to Mexico since Italy,
Spain and other near Second but really third World Europe of East and the West
manicured existence and False Economy with cheap and undesirable exchange
rate.
There is something of the
relationship between these remedies and the growth of US market which in many
areas are challenged by the BRIC nations. There is nothing to deny that even
Americans are not aware of the huge responsibility that the future holds for
their country or are they physically prepared to engage the rest of the
developing nations of the world. The problem US is facing with 'rising cost' of
Energy and natural resources such as grains, metals, lumber and Interference
from International conflicts and growth of small sector are problems which poor
and sometimes mischievous economic practices are forcing on the nation.
Europe in terms of the
International world markets and International banking Standards such as Basel
III, are so well trimmed that the even minor economic growth within the West of
Europe is not essentially open to new comers let alone others from different
ends of the earth. Here’s the conundrum, the poverty rate in Eastern Europe
alone is quite comparable to what is available in many third world markets. It
is possible to suggest that there are economic reasons why Europe has to
censure the attention is getting from Asia, for if these Tariffs and
organizations lower the standards as required by world markets, Europe may
suffer additional shedding of the Economic maturity preeminent in 2014. Such
process limits Europe as a truly International Open markets, and like Asia –
who deliberately manipulate their economy and operate all shades of Shadow
Banking (Moon-Walking) reverts to U.S and to some degree the British who are
not free from the trims of international currency manipulation. We compare
Canada to U.S, it is limits of its bearing vintage, at least, Canada is toeing
a similar line of practice but it is a small market benefiting the larger
franchise of World Market than India many times the size.
But in the age increasingly defined
by the productive aspiration is perhaps better rehearsed from shocking lack of
consumption economies which are the problems in 2014. It may be equally
difficult to escape the limits of Chinese success given the first fact that
80’s could in of itself be called a Japanese decade. But these period of
moderation which the 6% combined conversion of Chinese to US is set in such a
way as to project the strength of the Chinese Economy and its future role in
the world, is a future whose learning curve is primarily due to U.S Debt to
China and also the faith – which in the case holds no pretenses on the
conception of US as the Major economy power in the world – would be estimated
to play out when one economy ties itself too close to a more primary
economy. The success and decline of
Japanese Economy, which now like China is in moderation, is due to the open
market policies of the United States whose enviable economic policies is
bankrupt in Japan.
We may not fail to establish the
fact that the creation of Euro as a decoupling effect through overnight
Chicago, was not understudied before introduction, that the main problems
associated with such…is the underlining market structure which bank lending
possible. In 2014 unlike the decades following the removal of U.S dollars from
gold Standard in 1971, there are fewer and fewer Open Market Economies in the
world, and there is no denying that the New Economy of Global markets was not
enhance by the U.S actions in 1971. A comparative study of Japanese Automotive
Industries and the overnight rise of its electronic productions may seem to
suggest that it coincided with the larger roles of the Banks and the Federal Reserve
following the removal of U.S dollars from Gold Standard. The debt of United
States to much of the world as consequence of this singular act is essentially
out of the charts.
The results are no less evident,
for how could any economic society imagine the profits enjoyed by Japan and
recent times, India and China, were obtained through the market or capital
processes traditionally common to all markets. Perhaps a new definition of the
markets are required, but to the extent that no type of economy can thrive
without a Capitalist free market, it leaves us little or no room to beggar
assumption that all political economics which is not Capitalist – however
defined – is merely a process towards a free market. Barely two decades ago
could we discuss possibility of Asia economy as miracle, that it was lacking in
principle power house banks and had problems with foreign Investment Banks. but
less than a 20 years when at least in our current experience and memory, Banks
did not function in China except by diction from the seating Chairman, leaves
us a thing of wonder if not beauty that in 2014, China has managed to
manufacture 4 (four) of the leading 10 major Banks in the world.
In fact two of the top three banks
in the World are from nowhere the biggest bank in the world and are China owned.
The surprise is largely unclear given the….
Perhaps we should we worthy of the
strange and long tales about the Chinese development Banks, how much they were
worth even in the 1998 when for the best of us who were fortunate to hear
Chinese Engineering graduate at City College CUNY, invited their students to
China and to a future that could profit. These Banks were worth Billions, but
not tens of Billions until the Amalgamation of several Key Chinese Banks. One
of the most traditional Banks in China that was bound to its transformations as
a manufacturing hub is China Development Bank. Its feature and its role in
helping to transform Chinese resources from raw to manufacturing is intricately
bound to the evolution of Communist State and also its transition from
Communist State to Neo-Communism, practiced with lessons from the rise and
collapse of Russia and the shrinking of Japan following an explosive decade of
the 80s.
But these period of moderation
which the 6% combined conversion of Chinese to US is set in such a way as to
project the strength of the Chinese Economy and its future role in the world,
is a future whose learning curve is primarily due to U.S Debt to China and also
the faith – which in the case holds no pretenses on the conception of US as the
Major economy power in the world – would be estimated to play out when one
economy ties itself too close to a more primary economy.
The success and decline of Japanese
Economy, which now like China is in moderation, is due to the open market
policies of the United States whose enviable economic policies is bankrupt in
Japan. We may not fail to establish the fact that the creation of Euro as a
decoupling effect through overnight Chicago, was not understudied before
introduction, that the main problems associated with such enterprise is the
underlining market structure which make bank lending possible depends in part
on return rate, that an IOU to China was a strategic placement of operation
that enables a relationship between China and US to exist in the future.
In 2014 unlike the decades
following the removal of U.S dollars from gold Standard in 1971, there are
fewer and fewer Open Market Economies in the world, and there is no denying
that the New Economy of Global markets was not enhance by the U.S actions in
1971. A comparative study of Japanese Automotive Industries and the overnight
rise of its electronic productions may seem to suggest that it coincided with
the larger roles of the Banks and the Federal Reserve following the removal of
U.S dollars from Gold Standard in 1971. The debt of United States to much of
the world as consequence of this singular act is essentially out of the charts.
The triumphs of China over its local problems coincided with the fall of Russia
in the 70’s, and with arrival of Xiaoping, there was a new and awakened power
in the East. The manifestation of China as a power in the world entered its own
Tiger on the eve of EU introduction of a super single currency.
It needs be compared from the past
that a look at the resolutions of Russia during and after the Bolshevik
resolutions, points a China there was in disrepute, rotten to its quick by the
British preliterate ideologue and their proliferate French that barred each
other’s way but with understanding suckered China into a local and
under-developed market. With the rise of Russia, especially under Stalin, was a
China riddled with uncertainties between Kuomintang and the Ming or Red Party
led by Chairman Mao. The drug ragged Shanghai and the double functions of Du Yueh
Sheng, the total collapse of Shanghai under finance minister and premier T.V
Song and head of states Chiang-Kai-shek and his elder and younger sisters; Ai-ling
and Mei Song summarizes determination under Chairman Mao and eventually Hua
Guofeng who opened China to the rest of world.
But new sensation that China is
besting invokes the past triumphs of powerful states, who in the last 50 years
has seen Russia rise and in debacle – a debacle further complicated by the new
measures of President Putin in separating Russia from certain areas of the
world market. It was not a best way to replicate on a world sanctions, the
better approach was to challenge the procedure in court, collectively as the
United Nations, G-20, BRICS economic block, the MINT and individual members of
the signatory in Courts of appeal of their individual nations. Such long
process will meet the sanctions half way, enough to redeem what is left of
sanction. Russia did not do this, yet there will already struggling from the
total collapse of the long and powerful empire which they inherited from the
Turks and ruled with their help.
The Japanese would be the next
great wave whose export power and production hub transformed Japan and in fact
Asia into one of the world’s leading technology areas. Japan came very close to
overtaking the US in 1980-1982, but failed just by whiskers largely for the
role of a SIC (V) Insurance Company called these days AIG. The spread of AIG
into Asia; Philippines, Japan and China, was so charismatic that it may breathe
easy on my comparative separation of quantity of money as a physical property
and the use of digital cash-less technology not exactly like the Cards. Japan’s
rise heralded its decline. Its reasons why so different from Russia ascending
and descent, that new falcon on the block that would surpass America was said
by Robert Mundell not to be easily available. In limelight of the actions
performed against third world economies with more than a share of Tiger money to
buttress, for instance money derived from cash crop may have found its way to
the hands of those in power, may have found it way as a form of default and
above all, it looks like the saying is equally correct that the idea behind
regional formation of currency may have been based on John Nash’s ‘Governing
Dynamics’ which from his essays, seem to dovetail on the fact that in chain of
….in other to release the forces held by the
Fareed Zakari drew economic
landscape of Iraq, Afghanistan, Somalia, that “Over the past quarter century,
the global economy has doubled every 10 years, going from $31 trillion in 1999
to $62 trillion in 2008. Recessions have become tamer ever before average eight
months rather two years. More than 400 million people across Asia have been
lifted out of poverty.”
Kishore Mahbubani (Dean of the Lee
Kuan Yew school of Public Policy)…that ‘The last two hundred years of world
history has been a major historical aberration” ‘This is a key point that
people in the West have a hard time wrapping their minds around. From the year
1 to the year 1820, China and India consistently had the two largest economies
in the world. When you think about, it’s quite amazing that a small continent
like Europe was able to conquer and colonize the world. In many ways this
global domination by the West. Continued for a surprisingly long time. But I
think it’s finally coming to a natural end. So the challenge for the West is,
will it accept its loss power in the global system will it resist the transfer
of power?
From the optimism raised by the
Kishore Mahbubani ‘2014’ (The Great Convergence), which lack some degree of
pronounced and specialist depth, but scores of the collective advantages of
Global markets without defeating its actual meaning it did not mention that the
Global is not easily accessible. In the context of Applied General Equilibrium,
the themes of the Global Market is not new – net outflows correlating net
inflow; Outsourcing within the specific industrial sectors that levitate the
diminishing returns in one crop of real dividend at a bifurcation of an entirely
or sub-ordinate alternate. There is no ending to the acceptance that the ‘World
is Flat’ in which a certain Thomas Friedman writes for the larger playing field
of world market which for him was inter-connected, gradually plain and flat and
therefore needing more open systems like Judicial activity in handling Child
worker cases in India. What these men and women arguing for a flat world market
is a market condition where there are no profits for smaller companies, where
there is no ending to mercantilism and a market where the government of any
type, can essentially dump any the rest of world market without barriers and
regulations. Such markets without friction and are flat, are markets that are
not essentially real and are prone to damages and devoid of the laws of
comparative advantages away from Says, Ricardo, Jevon, and in recent times,…,
such world is a world of zero accountability, judicial inactivity or
interferences, and in Free Falling
(Stieglitz)…. There are objections to
the land field theorem of a large, burgeoning and expanding world where all and
everything is possible. The timing of these scheduled execution of businesses
in between the member states of various organization and less than independent
Labor Union. Paul Blustein (2010) stated in his Misadventures of the Most Favored Nations, that U.S Steel companies
can impose “….as high as 30 percent on
imported Steel, based on “safeguard” rules that allow countries to raise such
duties when suffering from a sudden flood of imports”. In his case against WTO,
the problem of flooding markets with cheap imports in the name of resource
allocation was essentially creating a labor gap which the safeguard through
tariff did not fill, that the issue bothers on geographical indication where
the 135 members of World Trade Organization varied in their profits and losses
towards achieving a more resourceful economy.
The Cost/Production marginal
propensity gate or PPF (Production Possibility Frontier) also called Common
Market; usually between lateral and multi-lateral economies of similar
corporative economic indexing such as a single currency, or policy driven
multi-national or trans-border laws permits a derivative growth in one area of
one industry to expand – almost and always – with view of spending, and with
higher view of matching the productive capabilities of Free trade nations along
the lines of Cost and supposedly economic growth; Common Markets. Global Market
is very complicated process, it attempts to shower the rusty years of a third
tier National owned corporation and industries, to privatization era and then a
long and tedious process of debt consolidation leading to models of General
Equilibrium; Computed General Equilibrium. This heist of rational thinking is
promising on what to expect from the attempts at trans-border equilibrium but
the left and right of its application is never determined by the set of data
usually farming products, rather from the shift in global demands of skilled
labor or workers, whereas the unskilled workers in lesser developed economies
experience a surge in wages, there is a decline of wages for unskilled workers
in more advanced economies.
Put in a real time framework,
Globalization perpetuates brain drain in less competitive markets, actualizes
the cross pollination of skilled workers from one Country to another usually
for higher competitive wages, and compels the bigger corporation to expand
before their frontier whereas small businesses and local new comers struggle
from day one. The take is subject to all fits of argument, but it needs be
mentioned that at attempts at General Equilibrium from or within Partial
Equilibrium is a deciding factors besides eroding the comparative advantage
between nations with useful levels of Common Market or Common Wealth restrictions.
A case in point would be the advent of reverse situation of pollution where in
the works of Anne Krueger and Eugene Grossman for World Bank on the effects of
environmental pollution, predate the popular theory of Industrial Waste by
citing that when a barrier of $5, 000 income per capita is broached for any
country, there is a sudden demand for environmental protection. Regional
economies of scale dependent or co-dependent of the monetary capacity of
affected States, usually in names of Free Trade, such as European Free Trade
Agreement (EFTA) and in recent time, North American Free Trade Agreement
(NAFTA), is usually a pacesetter for regional single currency.
They all began in the same form, in
one form and another, U.S may have traveled through the same process, and I
point to 1971 of a higher possible level, to the point that if elemental
argument over the change of market dynamics (System dynamics) in Europe after
WW II, where the circumstances of the World War forced the direct hands of the
respective warring nations into large scale industries – for instance the
German Electric, German Steel, Krupp in Essence (World Largest Arms dealer),
The French Oil Conglomerates, the British Petroleum, were gradually relieved
from the Government and placed into private trust and companies. It was a kind
of privatization that were mainly conditioned in the 1960’s and 1970’s,
especially after the departure of US from Gold Standard in 1971, and
consequently we notice the transition of some of Government owned companies in
India and in Mexico to shift into private management or what they call
Privatization Scheme by IMF – who played a deftly hand in the privatization of
Europe Government owned companies – leading to expensive acquisition of Debt –
in Europe perpetually indebted to US, and in Mexico totally a 100 billion
dollars in 1994. These mechanized schedule leads us to Europe of single
currency as prolegomena of Europe of one Country. It leads to converts that the
changes that are in effect in North America through NAFTA and through
subsidiary groups, leads with a Robert Pastor view of a long term goal of
unifying a North America. It is a repeat of prospective pattern that in effect
and with pompous renegade of Robert Mundel theories on regional economies, that
essentially erodes the advantages in market systems, implodes the presence of
consumptive economies or shrinks the Consumer based economies, that even of the
a few decades of scalability index separating prospective regional markets and
the relapse (redox) of previous markets and System Dynamics, often if not
always propel one market at the expense of the other.
The Communist Community based
Utility Complex propels productions, shrinks its consumer based market and
offers all sorts of challenge when there are materials cases separating a
Communist economy from a Capital economy. This is a big concern since in the
immediate circumstances of world market, or World Market as is, there are still
gaps in consumer markets that can be explored, but a level is not without reach
and a Global Convergence in a Globalized world market not without Plateau,
which in recent times is incidental to Great Depression where the absence of
disparity between Europe markets and US created a flux in the primary direction
of price movement. Momentum achieved through Keynes leads mainly to Divergent
market dynamics and not it’s Convergence. We may understand how Globalization
works from Jagidish Bhagwati’s ‘Defense of Globalization’ and ‘Why
Globalization Works’ by Martin Wolf, these two are well known theorist of
Global Free trade. William McGuaghey (1993) lavished on Bhagwatti essays which
appeared in Foreign Affairs where he
quoted Bhagwatti’s defense of GATT over NAFTA, that “If the United States turns
foolishly away from the world to her own backyard, the European Community’s
likely reaction would be; fine, get buried in it.”
But considering the problems of
Credit, Border control and Risk with financial stability, we may look at the
defense and concerns of Dimitri Papageorgiou, Michael Mickenly, and Chobki,…on
Risk involving different accounting standards and the problems of future
estimate. We may point out that the complicated law making processes between
nations with shared interest usually tend towards the final products of present
measure discountable profit of future estimate and correction when prices are
affected leads to new reality of forcing member states to lower their strong
currencies. Shortage in one area of farm produce in Netherlands could force the
demands of the total markets to fall on German and on France, who may be
required to compensate these gaps by lowering some of their highly priced
interest rate regime to accommodate the varying challenges on member states of
a European Union. The model implied and invoked elsewhere may be consigned to
the years leading to adopting the Single Currency, but the gaps in the balance
of trade and role of government in price modulation – not necessarily
moderation – usually dovetail the more primary system dynamic of Government
managed and heavily intervened Socialist markets.
But from at least the regimes of
the arguments which we can referee from Mabhubani ‘Great Convergence’ is his
citation of Eswar Prasad (Cornell University) lecture on Global Market and
Globalization that “The notion of a single global economy is a big step from
the high level trade and financial integration we now observe. As we are seeing
from Europe however, you need an institutional framework that is global in
nature to manage a global economy as a single unit. You would then a unified
political system or at least a high level of coordination at the political
level.” A careful read through on the plain discourse on the political activity
of a global market is shortened by the sight to a global political network –
not exactly dissimilar to a smaller Communist system dynamic, but seem from
long and tenured official position of Prasad on Europe, leads him to see
without necessarily accepting that the role of Government in selecting and
moderating price no less dissimilar in history to socialism as the vitae of a
Globalized future world. It is necessary to the extent of not diminishing the
driven roles of individual efforts and companies towards the actualization of
profit.
But the difference is that U.S was
expected to protect its local interest by ‘evolution’ its own market without
relapsing into any major world markets as opposed to the political ‘revolution’
of Communist East and Russia which then and now has the backing of the
Government. Russia is a giant in with old spades, has no meaning for New World
economy, can be argued to be counter-weight for the U.S economy at least up to
the late 70’s, but in the arrears of the ensuing years since the end of World
Wars, has gradually cleaved its wing in Shadows and in recent no more than a
shadow of its past. Perhaps the greatest impact of the Euro is that the forced
the Eastern corridors into the Global Macro, that the blanket weight of a
communist challenged Russia in Eastern Europe was no proving mark for a First
tier market, and in spite of Ukraine in this Age, we are no longer at the mercy
of GLOBULUS.
- Between the popular fronts of economic governments
and the attempts by South East Asia especially Japan to adapt to new
frontiers on economic principles are realities that are impossible to
measure without the dimly lighted U.S economy. Some of the Grand
Strategies of Meiji Government after the disaster of Hiroshima, popularly
led by Yoshida who was also admired by the larger Liberal International Markets,
is set with view of appropriating the benefits of world markets for the
Good of Japan, including loans to companies on interest with Foreign
Penetration. This Strategy particularly favored by the mining industries
encouraged the direct acquisition of foreign companies through state
sponsored monetary channels. The result of these was the rise of a nation
that emphasized production but defended its territory by limiting the
penetration of foreign investment through means and ways that is now and
then a Toyota riddle. The Tokyo
riddle is no doubt similar with Russia
Paradox itself the theme of a book by Sewreyen Bialer (Soviet Paradox;
1986), with the view of external expansion which held the Communist Nation
from the 1949 through the 1983, to an extent that the massive expansion of
these two giants, a front for the reality that China will brace, lead to
some poor Internal regulation or true measure of internal return creating
a decline that was not well known till the lost 90’s decade of Japan.
However we place the expansion of Japan in the 80's, its consequent
moderation or decline of overnight sensations could not be called an
accident. We are looking at the impact economic crusades had on the world,
beginning perhaps its periods of expansion, should be able to confirm that
following an extra-ordinary expansion of any market is the fait accompli
of a decline or perhaps a periods of moderation and attempt at balancing
or market been able to correct itself...., For reasons that are quoted
elsewhere and explicated by risk managers and experts, there are no
elements of surprises if the strain on Communist China to deepen, with or
without due inflationary pressure, no surprises when it fractures at its
some point and no surprises leading to a decade of moderation. Unlike the
80's, there are more countries in the world whose market policies are
mainly driven by supply side, unlike the past market conditions are
strained, and fewer consumptive markets exist, unlike Japan, China is a
billion market with sparing investment capacity.
- But this is not take case, the issue is the market
expectations at some point, to the extent to which the rest of well to do
world is seeking abortive means of generating impressions of economic
progress but are left furlough when now unlike the healthy American State
in the late 60’s and 70’s, is a State that is struggling with its own
problems. In one way or another, there are fewer and fewer states that toe
the older liberal world markets whose existence would be said to ensure
the sensation of these new economic blocks.
The US debt is well of 50 trillion
dollars as at 2012 and but the Nation somehow manages to hang in there as the
number one country in the world with 15 trillion dollars GDP, followed closely
by the China with up to 8 trillion dollar GDP at 2012. But the facts that US
are facing a stiff competition from the BRICS for instance suggest that the
world is expanding almost as simultaneously as the United States that these
nations should share the burdens associated with a liberal economy. In the
years preceding the arrival of Deng Xiaoping as Chinese premier it is on record
that China owed the rest of world almost nothing, that since the 80’s when
BEOING finally mounted Chinese first Airplane Plant in an old abandoned warehouse,
and Chinese Debt has climbed. But if we compare China to US in terms of Debt to
Earnings, China is perhaps a higher pedestal than US. Given the prevailing
economic communities of BRIC Nations such as Brazil and China, and going from
the spectacle of Leading Economic Indicators (LEI) of the world, it is easy to
however break the ice that indicative national economic environment of these
nations for instance the prospective list on stock exchange, hardly justify the
economic weights projected. China is quite an example and in so far as the
BRICS, is as good they come.
We are not to subtract the
Community of hopefuls on China from real time economies of the world, but
Chinese economic policies and degree of transparency still disappoint. No
country that pampers itself as a worthy challenge of major economies of the
world should box itself to a corner or arbitrarily operate in shadow. The
relevance of China to the rest of world may dominate world market opinions for
a very long time and be determined by its moderation to the disciplines of
World Market systems which are really System Dynamics. Cloud Computing.
We can assume that given the amount
of industries available in the States versus the Chinese, should try out
patience but there is an argument to be made about the return to Shenzhen.
India is worthy of consideration as any would expect, but it still wears the
goggle of Third World Economy given the wider population to feed. In US, we are
spectators of the dangling issue of Social Security and the attempt at
reforming Medicare and Medicaid with Obamacare.
The role of Obama Care in trying to
wrestle the problems of inflation in US and reduce the issue of US debt may
discovered in the pages of the Paul Krugman’s ‘The Conscience of a Liberal’
where in pages 224 through 242, particularly 242 where he mentioned that
employers and Insurance companies ‘mitigate’ the Welfare of their employees by
choosing who to insure. It was pointless to mention that those without hope of
surviving on a long term basis and not adequately insured are left for the dead,
or left to shift from individual pay as you go to US managed Welfare
constitution and these people account for the worst Welfare cases. Krugman’s
‘Conscience of a Liberal’ is arguably his best book, which was recognized by
international committee leading to his Noble Prize. Krugman’s anti-IMF and
World Bank position is not different from the Joseph Stieglitz opposition to
Washington Consensus but he managed this from the problems of 2008 financial
collapse which neither him or even Robert Shiller can actually claim to have
written significantly about it. For a fact the ‘Great Unraveling’ would to have
been taken from a page in Richard Parker's ‘John Kenneth Galbraith; His Life,
His Politics, His Economics’ where the delivered the unraveling leading to the
problems of government intervention removed from the intentions of the original
thinkers.
