Tuesday, October 25, 2011

A new book on Deng Xiaoping

Harvard professor Ezra Vogel has written a new book on Deng Xiaoping, the former Party leader and the chief architect of China's opening-up policy, entitled "Deng Xiaoping and the Transformation of China". According to former US National Security Advisor Zbigniew Brzezinski, this book is "not just a definitive biography of a world-class leader, but also the most authoritative and riveting account of the secretly contrived U.S.-Chinese strategic accommodation of 1978 and of how that in turn facilitated China's domestic transformation."

Here are three book reviews from The Wall Street Journal, The New York Times and The Economist.

Monday, October 24, 2011

Joking about bankers? Not really.

Blackstone co-founder Stephen Schwarzman joked about Brian Moynihan, CEO of Bank of America, by drawing a parallel between Mr. Moynihan and his brother, Patrick:

"Patrick runs a Catholic boarding school in Haiti,...,so their parents must be so proud to see two of their boys each running an underfunded, nonprofit, organization."

Of course, it's not just one banker - Brian Moynihan alone - who is facing tough times, they all are, apparently.

Saturday, October 15, 2011

China currency debate

Two voices on China's currency issue appeared in Wednesday's US republican presidential debate.

Jon Huntsman - "I don't subscribe to the Donald Trump school or the Mitt Romney school of international trade. I don't want to find ourselves in a trade war. With respect to China, if you start slapping penalties on them, based on countervailing duties, you are going to get the same thing in return because they are going to say 'because of Quantitative Easing part I and part II, you are doing a similar thing to your currency'. And you are going to find yourselves in a trade war very very quickly."

Mitt Romney - "I am afraid that people who've looked at this [China's currency issue] in the past have been played like a fiddle by the Chinese. And the Chinese are smiling all the way to the bank, taking our currency and taking our jobs and taking a lot of our future...You people say, well, we might have a trade war with China, and think about that, we buy this much stuff from China, they buy that much stuff from us. You think they want to have a trade war?...I mean, this is a time when we are being hollowed out by China, that is artificially holding down their prices, and that's having a MASSIVE impact on jobs here."

Romney's view is clearly not shared by Economists Nouriel Roubini and Richard McGregor.

Wednesday, October 12, 2011

Tribute? Anger?

Usually, those two don't mingle. But,

A tribute to Steve Jobs

Charlie Rose gave a tribute to Steve Jobs last week with Google chairman Eric Schmidt, Netscape co-founder Marc Andreessen, WSJ columnist Walter Mossberg, writer Walter Isaacson, CEOs Lawrence Ellison and Bob Iger, Apple co-founder Steve Wozniak and journalists Ken Auletta and David Carr.

iFans, you can watch the entire program here.

Be it resolved...

...North America faces a Japan-style era of economic stagnation.

This is an upcoming event from the Munk Debate. The pro side of the debate: Paul Krugman and David Rosenberg. The con side: Larry Summers and Ian Bremmer.

Previous debates on the Munk Debate include topics like whether the 21st century belongs to China, is foreign aid to the developing countries doing more harm than good, whether the climate change is mankind's defining crisis, and more.

Tuesday, October 11, 2011

Battle against yuan

US Senate just passed a bill that would lead to trade sanctions against countries whose currencies are manipulated. One currency on the legislators' minds is, of course, the yuan. The past two weeks has witnessed China's currency moving in exact the opposite directions in the onshore and offshore markets. During such a bumpy ride, we already saw that Beijing has sent its goodwill to the US to avoid future diplomatic and trade conflicts, but the passing of such a bill could only make things worse - for both countries. The question here is that, is yuan being manipulated?

The chart in today's The Economist speaks far louder than politics does. It suggests, "the recent relationship between China's currency and America's trade deficit with China is not what China hawks in the Senate think it is. Rather than a cheap yuan leading to a flood of Chinese imports, the yuan has actually strengthened as the deficit has widened. There are many things American companies dislike about the way business is done in China: intellectual-property theft, the impossibility of winning government contracts, baffling rules on corporate ownership and so on. However the place for fixing these things is the World Trade Organisation, not Congress."

Will this bill alter anything in a significant way? No, says Wall Street Journal columnist Tom Orlik. He further suggests that neither US politics nor China's "narrower self interest" could derail the fundamental strategy on the yuan.

Monday, October 10, 2011

The Nobel goes to...

Thomas Sargent and Christopher Sims for "their empirical research on cause and effect in the macroeconomy".

I have only very limited knowledge on them, but surely Sargent is the most renowned scholar in the "rational expectation school" after Robert Lucas, and Sims has developed and promoted some important and widely used empirical methods in modern macroeconometrics, such as VAR (vector autoregression).

For those on the promising list but didn't get a phone call from Adam Smith or someone with a typical Swedish accent, nevermind, your chance is getting bigger.

update: Robert Lucas discusses both of the laureates here. He says while Sargent has put a lot of emphasis on policy analysis and the economics to build models, Sims is focusing exclusively on using econometric methods to do "economic forecasting without much economics".

Thursday, October 6, 2011

Few can...

...be remembered like this:

a "visionary leader", an "iconic legend", a "creative genius", "an original", the "most innovative entrepreneur", "a historical figure on the scale of a Thomas Edison or Henry Ford", "the greatest computer innovator in history", and simply, a "hero".

RIP, Steve Jobs (1955-2011).