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Asia Times Online :: China News, China Business News, Taiwan and Hong Kong Ne…: Apr 18, 2:10pm 1 review economics, globalization, change
http://www.atimes.com/atimes/China/JD19Ad01.html; Asia pushes, West resists in AsiaTimes by Sreeram Chaulia a review of The New Asian Hemisphere. The Irresistible Shift of Global Power to the East by Kishore Mahbubani. PublicAffairs, New York, 2008.
Mahbubani asserts that a turbulent era of de-Westernization has commenced in Asia. With most Asians disavowing former beliefs that the West was the "most civilized part of the world", the latter has lost appeal as an ideal in human advancement. Chinese intellectuals, drawing on a history of insularity, have decolonized their mind the furthest and fastest. Accompanying China's accumulation of wealth and economic vitality is a popular rediscovery of its glorious cultural heritage and pride. De-Westernization is even more drastic in the Middle East. Hardly any Muslim society, perhaps not even Turkey, is trying to demonstrate that it is Western in spirit. Islamic publics view Westerners as immoral, greedy and insensitive to the loss of Muslim lives. Mahbubani considers India to be a bridge between the "West and the Rest". Indian thinkers do not see the West as the custodian of the highest values, but they also appreciate their country's historic place in constantly admitting and absorbing foreign influences. Mahbubani rides on China's geopolitical success to infer that "Asians are capable of delivering a more stable world order". Asia pushes, West resists Change is a process. Geo-political change is a rather long process and let's never forget that it often is fraught with violence. The root cause of the present geo-political change is the entry of China, India and the whole of Asia, Africa and South America into modernity. Modernity is first and foremost the application of the logic of capital to all aspects of life. Instead of continuing to eat the products that they grow on their fields people leave the land to go work in factories that have been financed by capital. From then on they will be forced to buy everything that is necessary to reproduce their daily lives and later everything that they think is necessary... This process of swelling domestic demand is satisfied by always more productions of goods and services. It becomes then evident that population size is going to be what differentiates the economic size of nations. Great-Britain was no match, in the 20th century, in term of population size for the US nor any other European country for that matter. After the 2nd world war Europeans took the path of unification and after half a century they got a unified currency and a European central bank and soon a president, a foreign affairs secretary and so on. But Europe is only marginally larger than the US... The story in Asia is definitely going to be far more world changing. China's population is not far from a billion and a half (official + not counted) and India is on the path to surpass China within a few decades. That gives us a population of 3 billion approximately versus a population of 3 quarters of a billion for the US + the EU. If those 2 countries can sustain for a few more decades their extremely rapid rates of economic growth each is going to surpass the economic size of the US and later the combined size of the US + the EU. This is going to have a decisive impact on how the world will be running in the coming decades not only economically but also politically and culturally. How is whiteman going to take those changes is the subject of Kishore Mahbubani's book.

The Automatic Earth: We have not yet conquered folly: Apr 12, 3:40pm 1 review economics, globalization, finance
http://theautomaticearth.blogspot.com/2008/04/we-have-not-yet-conquered-folly...; We have not yet conquered folly in the Automatic Earth By Matthew McClearn with Comment by Ilargi
The one thing I take away from pieces like the one below is a question: Why doesnu2019t anyone seem to ask if perhaps we could have entered a crisis that will be worse than the Great Depression? I guess perhaps we see this all far too much from the restricted point of view of economics, and the Great Depression is a benchmark that economists cannot look beyond, a horizon they cannot scale. Iu2019ll admit, I have already seen the term Greater Depression used, but the notion is exceedingly rare, and there are certainly very few, if any, specifics being laid out of what that would mean for our daily lives. Still, I would personally think the risks of sinking deeper than in the 1930u2019s is very much present. That, to me, is the scariest thing about all this. It led to a world on fire, and 40-50 million dead just from warfare. Todayu2019s world population is over 3 times larger than in the 1930u2019s. At the same time, there are much fewer -prospects of- resources, particularly energy, and much higher senses of entitlement among the now 1.5 billion prosperous guests of this planet. Because of this all, I find it even hard to see how we could ever climb back out of the hole weu2019re busy digging. And if we can, how many of us will make it? We have not yet conquered folly Brother Can You Spare 10 Grand? by Peter Schiff in SafeHaven Economic woes hit American stomachs Associated Press on CNN Online Itu2019s a Crisis, and Ideas Are Scarce by FLOYD NORRIS in the NYT Business 'Okies' on their way to California, 1933 (via Automatic Earth) The financialization of the economy that started in the eighties under Reagan and was set forth under Clinton comes presently to its conclusion and that conclusion is that it all has been been hot air that was not sustained by solid work generating solid savings. The US is now largely indebted and the creditors are going to collect. But the whole game having been only hot air not much will be found worth collecting. No problem with internal debts. But not so with debts towards foreigners! They will take whatever can be taken. They are already busy buying up US companies. The defense against what shall soon be perceived as an outside financial attack will be inflation in an attempt to melt away the dollars that they hold. The only problem is that this will also melt away the buying power of the US citizen. Paradoxically inflation will be paralleled by deflation in housing and financial assets. But what of the anger of the US citizen seeing his savings melting away? Is the establishment going to deflect that anger with the only thing that the US possesses more than all other nations together? It seems to me that the human story always repeats itself. The only thing making sense, in my eyes, is to observe the circus while trying to find a niche to protect oneself...

For Many, a Boom That Wasn't - New York Times: Apr 9, 8:47am 1 review economics, globalization, finance
http://www.nytimes.com/2008/04/09/business/09leonhardt.html?ex=1365393600&en=...; For Many, a Boom That Wasn't in the NYT Business by DAVID LEONHARDT
...The ... now-finished boom was, for most Americans, nothing of the sort. In 2000, at the end of the previous economic expansion, the median American family made about $61,000, according to ... inflation-adjusted numbers. In 2007, in what looks to have been the final year of the most recent expansion, the median family, amazingly, seems to have made less - about $60,500. This has never happened before, at least not for as long as the government has been keeping records. In every other expansion since World War II, the buying power of most American families grew... You can think of this as the most basic test of an economy's health: does it produce ever-rising living standards for its citizens? ... For Many, a Boom That Wasn't It will be tempting for some to lay the blame on George Bush. But the decline in living standards, that those figures are illustrating, is not related to US internal politics. It is related to the great re-alignment of economic forces around the world. The present round of globalization that started in the seventies has flattened the economic and financial level playing field. After 3 decades of free capital flows around the world the production of goods has largely been de-localized from the West to the South. Western factories that once procured good paying jobs closed and the jobs that were thus lost have been replaced by low paying service jobs. To keep their living standards from falling many have been obliged to take on a 2nd and in some cases a 3rd job. But longer working hours have not succeeded in maintaining the past standard of living. What is going on is a global re-balancing of the standards of living among nations that is taking place as a result of the free flow of capital: - Western incomes are coming down. (in most Western nations) - Southern incomes are going up. (in some Southern countries) Globalization has essentially been the bestowing of free movement on big capital. This allowed big capital to crunch once and for all the labor movement with whom it had been politically obligated to sit with a bargaining table. Once free to move over borders big capital went where no social bargaining tables had yet been politically imposed which helped in reducing its work costs which in turn helped it supplying cheaper goods to its traditional consumer bases. Economists and politicians of all stripes have defended globalization thinking that it gave their nations the advantage of scale economies. Those advantages were real but they did not benefit their nations. They benefited the multinational companies invested by big capital holders. So now what? - Capital has gone global and, in so doing, has gained a bargaining power with nations that weakened the application on itself of their regulatory framework while simultaneously imposing the weakening of organized labor and workers' historically gained benefits. - Work remains a national affair. Put in a position to compete for the localization of big capital the political elites have accepted to weaken organized labor in all nations. - Conclusion: Big capital is not going to abandon the bargaining chip it gained over labor through this last round of globalization but a reaction is nevertheless in the making at the level of nations in the form of protectionist barriers. Let's just remember that this has historically been the ferment of nationalism and wars...

Boom in the Doom - iTulip.com Forums: Apr 5, 3:07pm 1 review economics, future, finance
http://www.itulip.com/forums/showthread.php?p=26714; Boom in the Doom in ITulip by Fred
I worry about the outcome of the collapse our broken credit system and the de-evolution of a lopsided US economy that is overly dependent on debt and finance. I am even more worried about the political backlash at a time when the Internet has created the most fertile breeding ground in history for sophistry and demagoguery from left to right. A few years into the kind of downturn I expect a lot of bad and discredited ideas may well become fresh, new and promising again, with the usual dreaded outcome. Readers need to get into the habit of challenging not only the beliefs of others but their own beliefs. This is where we can all make a difference: demand precision, respect expertise but always question motives and interests, and know that the truth is a journey not a place, and always be seeking. Lecture over. Today is rebuttal day. So much ideological economics to refute, so little time. Where to start? My two favorites are an article by professional doomer James Howard Kunstler and a u201cmissiveu201d by the prolific and good hearted critic of greedy Wall Street bankers Mike (Mish) Shedlock. Boom in the Doom Mish's Global Economic Trend Analysis Clusterfuck Nation by Jim Kunstler Are You a Doomer? Most of my postings these last few months concerned the economic and financial fiasco that is today's talk of the media. I make the effort to pluck the daily pearls of sense among some 80 publications. I could not have missed those rare analysises of the coming greatest economic and financial disruption of capitalism since the great Depression? No I could not, for, this disruption will engender a whole new ball game for all of us. But those who follow my postings will have observed that I continued posting about art, about China and India, about alternative energies, about scientific discoveries, about philosophy, about the future Open Society and so on. What I want to say is that I never drowned into doom. On the contrary. I feel that humanity is marching toward its unification through the sharing of a common worldview. This does not imply that we will not experience economic depressions, ecological catastrophes and population falls. It simply means that I don't let myself being overwhelmed by "short termism". In other words I don't believe that an economic depression nor peak oil nor climate change nor any side-effects of modernity, even not societal atomization, will ever eliminate the principle of life. None of those lead to the end of the world. On the contrary they are chances for change. And we all are longing for change is it not? Fred's "Boom in the Doom" is a rational rebuke of some of Mish's thesis and of James Howard Kunstler's doom vision. As he concludes the object of their writings "... does not mean the end of the world. My suggestion to anyone running a site that complains about how screwed up things are start now thinking about constructive solutions." Yep.

http://www.investorsinsight.com/otb_va_print.aspx?EditionID=673: Mar 31, 5:19pm 1 review economics, globalization, finance, worldviews
http://www.investorsinsight.com/otb_va_print.aspx?EditionID=673; How To Fix It in "InvestorsInsight : Thoughts From The Frontline" by Michael Lewitt
America is rushing headlong into the 21st century without a proper understanding of what economic policies and financial tools are going to be required to prosper in a changing world. For more than two decades, the United States economy has favored financial speculation over production. Over the past century, our legal system had developed an increasingly outmoded concept of fiduciary duty that privileges short-term, single-firm interests over the kind of long-term, society-wide interests that could lead to prolonged prosperity. The current meltdown in the financial markets is a symptom of a serious disease that is eating away at the stability of our most important institutions. What we are witnessing might well be the end of American financial hegemony, which is the result of a burgeoning global economy. The current crisis in financial markets gives us an opportunity to evaluate how we can better prepare ourselves to deal with a borderless world. If you want to look at the end of American economic hegemony, just look at the list of desperate actions taken by U.S. financial authorities above. It is a sad commentary on how the greed and short-sighted actions and policies of U.S. politicians and businessmen have inflicted permanent damage on our economy. The Criminalization of American Finance by Michael Lewitt of HCM (Hegemony Capital Management) How To Fix It by Michael Lewitt of HCM Ten Fundamental Issues in Reforming Financial Regulation and Supervision in a World of Financial Innovation and Globalization by Nouriel Roubini The articles linked to here above are written by most respected economists and their language is plain. They speak about the US economy of these last 20 years having been driven as a gigantic financial ponzi scheme that has inflicted permanent damage to the economic health of the country. My last post was oriented more on the beneficiaries of the damage done to the US economy and the consequences for the West and the emergence of a new economy-world. What is happening is going to have a drastic impact on our daily lives along the years and decades to come. This is valid for all of us. Artists will not be spared and the content of their works will definitely be driven by those changes...

The New York Times & Log In: Mar 31, 10:17am 1 review economics, globalization, finance, worldviews
http://www.nytimes.com/2008/03/31/opinion/31cohen.html?_r=1&th&emc=th&oref=sl...; The Baton Passes to Asia in The NYT by Roger Cohen and in Times by Michael Schuman
It's the end of the era of the white man. For years, Americans have reveled in profligate, load-up-the-back- of-the-SUV-at-Target excess, much of it paid for by credit cards, home equity or other loans. The binge has produced some supposedly healthy economic growth and provided everyone lots of nice stuff. But now debt collectors from around the world are knocking. That's why today's turmoil in U.S. financial markets will end in a massive transfer of wealth from America to the rest of the globe. The Baton Passes to Asia America's Coming Garage Sale At long last the established media comes to the realization that globalization brings about the end of Whiteman's economic dominance. But the real significance of the end of Western dominance has still not sunk in the conscientiousness of Western intellectuals and the opinion leaders who diffuse theirs ideas. The end of our Western economic dominance implies the loss of our cultural hegemony and our gradual adoption of the value system and cultural traits of the nations that are gaining economic dominance. That means that the coming years and decades will be marked by: - a gradual ending of Laissez-Faire economics and a new phase of state interventionism. - the gradual adoption, by all the citizens of the world, of the values and cultural traits of the nations that assert their newly gained economic dominance. - the gradual emergence of a "worldwide worldview" that will glue the citizens of the earth through the sharing of a common understanding of reality that will be far apart from the dualism of the religions of the word. - This "emerging worldwide worldview" will displace modernity to the dustbin of history and bring answers and solutions to the numerous side-effects of modernity as well as the peaking of numerous resources... that are starting to be felt nowadays I have the feeling that the answers provided today by the most conscientious Western thinkers, to the numerous side-effects of modernity and the peaking of resources, are short-sighted and wrong. This is not the end of the world and the solution is also not related to a technological miracle. The problem is that they close their eyes to the rest of the world and are thus digging ever deeper into irrelevant postures. Western intellectual solutions to the problems of modernity will definitively not be adopted by the rest of the world but the culture and values of the rest of the world will definitely impose themselves on all...

"The next bubble: Priming the markets for tomorrows big crash"…: Mar 11, 10:39am 5 reviews economics, finance, change
http://www.harpers.org/archive/2008/02/0081908; The next bubble: Priming the markets for tomorrow's big crash in Harper's Magazine by Eric Janszen Eric Janszen is the founder and president of iTulip, Inc. He formerly served as managing director of the venture firm Osborn Capital, CEO of AutoCell, Inc. and Bluesocket, Inc., and entrepreneur-in-residence for Trident Capital.
After 1975, the United States would never again post an annual merchandise trade surplus. Such high-value, finished-goods-producing industries as steel and automobiles were no longer dominant. The new economy belonged to finance, insurance, and real estate - FIRE. ... As FIRE rose in power, so did a new generation of politicians, bankers, economists, and journalists willing to invent creative justifications for the system, as well as for the projects - ranging from the housing bubble to the Iraq war - that it financed. ... In a bubble, fictitious value goes away when market participants lose faith in the religion - when their false beliefs are destroyed as quickly as they had been formed. Since the early 1980s, the free-market orthodoxy of the Chicago School has driven policy on the upward slope of an economic boom, but we're all Keynesians on the way down: rate cuts by the Federal Reserve, tax cuts by Congress, deficit spending, and dollar depreciation are deployed in heroic proportions. ... Even after the faith that supported a bubble recedes, false beliefs continue to obscure cause and effect as the crisis unfolds. Consider the chemical industry of forty years ago, back when such pollutants as PCBs were dumped into the air and water with little or no regulation. For years, the mantra of the industry was "the solution to pollution is dilution." ... Many decades later, with our plagues of hermaphrodite frogs, poisoned ground water, and mysterious cancers, the mistake in that logic is plain. Modern bankers, however, have carried this mistake into the world of finance. As more and more loans with a high risk of default were made from the late 1990s to the summer of 2007, the shared level of credit risk increased throughout the global financial system. ... As more and more risk pollution rises to the surface, credit will continue to contract, and the FIRE economy - which depends on the free flow of credit - will experience its first near-death experience since the sector rose to power in the early 1980s. Because all asset hyperinflations revert to the mean, we can expect housing prices to decline roughly 38 percent from their peak as they return to something closer to the historical rate of monetary inflation. If the rate of decline stabilizes at between 6 and 7 percent each year, the correction has about six years to go before things stabilize, leaving the FIRE economy in need of $12 trillion. Where will that money be found? ... Now the Funds Rate is only 4.5 percent, the dollar is at multi-decade lows, the federal budget is in deficit, and tax cuts are still in effect. The chronic trade deficit, the sudden depreciation of our currency, and the lack of foreign buyers willing to purchase its debt will require the United States government to print new money simply to fund its own operations and pay its 22 million employees. ... ... we can expect to see the creation of another $8 trillion in fictitious value, which gives us an estimate of $20 trillion in speculative wealth, money that inevitably will be employed to increase share prices rather than to deliver "energy security." ... Given the current state of our economy, the only thing worse than a new bubble would be its absence. The next bubble: Priming the markets for tomorrow's big crash Excellent article. If you are interested to understand what drives our economies and societies in early 21st century then you should absolutely read this extremely long article.

Asia Times Online :: Asian news and current affairs: Mar 10, 11:50am 1 review economics, globalization, finance, change
http://www.atimes.com/atimes/Global_Economy/JC11Dj01.html; What is left that is sellable? in Asia Times by Doug Noland
It was a bubble of historic proportions and it's all laid out on the L.107 page in the Fed's Z.1 report. ... For the year (2007), total credit (non-financial and financial) expanded a record $3.998 trillion (8.9%) to $48.808 trillion. This was a moderate increase from 2006's growth of $3.859 trillion (9.4%), and compares to 2005's $3.310 trillion, 2004's $3.178 trillion, 2003's $2.779 trillion, 2002's $2.781 trillion, 2001's $2.020 trillion, and 2000's $1.679 trillion. Total credit market debt averaged $2.500 trillion annual growth over the 10-year period 1997 to 2006. ... ROW holdings (Rest Of World) of US financial assets were up an astounding $7.222 trillion, or 88%, in just four years ... Somehow, everyone wanted to make believe that we would always enjoy the luxury of trading endless new securities for imported energy, commodities, capital equipment, cheap electronics, and all the consumer goods we could ever dream of. The problem was that our credit system was issuing ever larger quantities of increasingly suspect financial claims ... Well, the entire world has become aware of our situation and will be less than keen to accumulate more of our debt. What is left that is sellable? The Face-Slap Theory in the NYT, a difficult recognition, by PAUL KRUGMAN Going Going. . . . in Clusterfuck Nation by Jim Kunstler Sorry; again a post about economics and finance. I would rather write about another subject but this is unfortunately what dominates our present. "Total credit market debt averaged $2.500 trillion annual growth over the 10-year period 1997 to 2006. " This means that on average the US economy needed, in each of these last 10 years, to borrow the equivalent of 20-25% of its annual GDP to retain its way of life and its status as n#1 economic power on earth. Today when papers, representing the US total debt of $48.808 trillion, come to market they most often don't find buyers any longer. That means that financial investors have lost trust in paper and the value of paper goes down meaning that the present assets of US citizens and enterprises are fast melting away. That also means that the US will no longer be able to find buyers for new debt paper and in consequence it will not be able to sustain its way of life and its status as n#1 economic and military power on earth. The financial Armageddon that we are witnessing is reassessing the value of currencies and also the size of national economies. From the present financial swing will emerge a very different world where the relative size of the US will have shrunk drastically. Meanwhile the EU, India, and particularly China will grow as the new dominating centers of world power. And there is a huge risk that in this changing economic and political context the side-effects of modernity will lose people's attention forced as they will be to struggle for survival.

Beyond hope and doom: Time for a peak oil pep talk | EnergyBulletin.net | Peak O…: Mar 3, 1:11pm 2 reviews economics, complexity, change, collapse
http://www.energybulletin.net/41149.html; Beyond hope and doom: Time for a peak oil pep talk in Energy Bulletin by Richard Heinberg
Awareness of Peak Oil, Climate Change, impending global economic implosion, topsoil depletion, biodiversity collapse, and the thousand other dire threats crashing down upon us at the dawn of the new millennium constitutes an enormous psychological burden... Planetary worries can be even more debilitating. What if there simply is no hope? Beyond hope and doom: Time for a peak oil pep talk The search for knowledge, in our times of word abundance, unmistakeably drives us straight to a wall of doubt that sends to us flash-back questions such as "where are the answers to the knowledge we gain about the sheer misery that we and our modern societies are inflicting upon the principle of life on earth?". in "Beyond hope and doom" Richard Heinberg is asking that kind of question but he is not giving us any plausible answer. Writing that "We're all in this together. Let's rely on one another's reserves of psychological strength when we need to, and provide strength for others when we can." only envisions a psychological remedy to forget about the enormity of the misery that we are inflicting upon the principle of life on earth. Sharon Astyk writes that "we must find a way to hallow, or at least apply meaning, to our descent". Hallowing the descent The only meaning I can see in humanity diving into its own collapse is that humanity is only a necessity for itself. The principle of life does not need humanity to sustain its own existence but humanity, at least at its operating level, needs the consciousness about itself as it relates with the whole to assure its own reproduction. This kind of finality in the conclusion generates another set of question: "If humanity is of no particular necessity for anything else than itself than perhaps we its conscious particles, functioning as its operating principle, have a vested interest to protect it from itself". This it seems to me constitutes the ultimate intellectual rejection of modernity and the principle of equality that it generated as an invisible strategy to maximize the expansion of economic demand so that the logic of capital could generate ever more surplus of capital. But then how do we stop this societal cancer? For Dmitry Orlov "Rather than attempting to undertake the Herculean task of mitigating the unmitigatable-attempting to stop the world and point it in a different direction-it seems far better to turn inward and work to transform yourself into someone who might stand a chance, given the world's assumed trajectory". This is the start of the answer on how to stop the societal cancer. But it is not the end of the answer! Communities and neighborhoods will inevitably address the end of the answers. Or at least they will try to do just that, for, without communities the individuals simply die. Review of Dmitry Orlov's Re-inventing Collapse I personally like the optimism of James Lovelock""There have been seven disasters since humans came on the earth, very similar to the one that's just about to happen. I think these events keep separating the wheat from the chaff. And eventually we'll have a human on the planet that really does understand it and can live with it properly. That's the source of my optimism."" 'Enjoy life while you can' James LOVELOCK's website We're drunk and we're at the edge of the roof.

The Oil Drum: Europe | Olduvai revisited 2008: Feb 29, 5:02pm 2 reviews economics, energy, globalization, geo-politics
http://europe.theoildrum.com/node/3565; Olduvai revisited 2008 in The Oil Drum by Luis de Sousa and on You Tube by Nate Hagens and Chris Vernon
Richard Duncan's Olduvai Theory is re-assessed with the latest available data and modern fossil fuel depletion models. On the second half it is analyzed how can alternative energy sources fill the gap left by those finite resources. Olduvai 2008 post Olduvai 2008 movie Forecast for Conventional Fossil Fuels per Capita. Sources: UN for Population model, Jean Laherr\u00e8re [pdf!] for Natural Gas, Energy Watch Group for Coal and The Oil Drum - Khebab for Oil. http://video.google.com/videoplay?docid=2656287165913612688&hl=en My reading of what is going on today around the world integrates a set of factors that will be determining the future of humanity: - Environmental Chaos: Climate Change, loss of bio-diversity, poisoning of land, water and air, - Resource Collapse: Oil. Water. Topsoil. Fisheries. Seeds. Arable land. Minerals. Copper. Food. - Societal Atomization - Economic Globalization: Financialization, Outsourcing, Institutional lag The Oil Drum (TOD) is all about Peak Oil and the collapse of our energy resources...