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Bo Peng  

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  • The Dawn Of The Franco-German Empire [View article]
    India has been playing the balancing game between the powers as a way to maintain some semblance of independence, which is a sensible strategy for all big but weak countries, as China has done and still trying to do, only to a less extend and in different form. Right now it's still mostly between US and Russia for India, but they're trying to bring in Europe. I expect them to continue this approach if there's the New Axis. As to the rest of Asia, they have to make a choice, Japan included. They don't have enough weight to form a separate pole.

    What the heck, it's Friday.
    Dec 2, 2011. 07:24 PM | 2 Likes Like |Link to Comment
  • This week is the start of a year-end rally that should take the S&P to at least 1,350, JPMorgan's Thomas J. Lee believes. He recommends a "cyclical cocktail" of stocks, including financials such as BAC and MA, casinos like WYNN and LVS, and a bunch of others. UBS' Jonathan Golub thinks it's better to wait, anticipating better entry points in 2012.  [View news story]
    Amazing. Guy still gets paid for applying historical seasonal return patterns.
    Dec 2, 2011. 05:08 PM | 3 Likes Like |Link to Comment
  • The massive Monday rally? It appears the Fed made today's swap decision on Monday in a 9-1 vote with only Richmond Fed chief Lacker dissenting.  [View news story]
    Where's the outrage? I don't expect any.
    Nov 30, 2011. 11:34 AM | 1 Like Like |Link to Comment
  • Don't expect China to ride to the world's economic rescue, and don't expect its booming growth to continue, Gordon Chang warns in predicting a "hard landing" coming for China. Bubbles created by excessive government stimulus have not been addressed, and transitions inside the political system are making it less likely they will be before market forces intervene.  [View news story]
    Guy said china would collapse in 2006. Amazing foresight.

    If you keep saying someone "will die today" everyday for 200 years, one day you will be right. And, judging by continued interest and intrigue in Gordon Chang today, the world will come congratulate you on your day of vindication.
    Nov 18, 2011. 06:23 PM | Likes Like |Link to Comment
  • Unhappy with just running the show in Greece, Italy ..., Germany also has a secret plan to prevent the U.K. from calling a referendum on proposed EU treaty changes (see this also). Angela Merkel is meeting with David Cameron in Brussels today to see about bridging disagreements over handling of the crisis.  [View news story]
    Glad I'm not the only one seeing a whiff of parallel between now and pre-WWI in Europe. A resurgent Germany welcomed by Britain. Next step: Britain and France align against Germany? Germany and Italy, Austria/Russia the new Triple Alliance? That'd be too scary.

    At some point Russians will join the game and, no matter what they do, it'd be a turning point to the worse.

    I don't seriously expect a military war in Europe, though anybody writing off the possibility needs to study history. But an economic/financial one could be equally damaging today.
    Nov 18, 2011. 02:44 PM | Likes Like |Link to Comment
  • Unhappy with just running the show in Greece, Italy ..., Germany also has a secret plan to prevent the U.K. from calling a referendum on proposed EU treaty changes (see this also). Angela Merkel is meeting with David Cameron in Brussels today to see about bridging disagreements over handling of the crisis.  [View news story]
    Europeans are great with plans and treaties. Look at 1890-1914. Amazing stuff.
    Nov 18, 2011. 11:08 AM | Likes Like |Link to Comment
  • How The 'United States Of Europe' Could Come Unglued [View article]
    Interesting idea, InnocentsAbroad. Do you think the Italian people would actually want to do that, though?
    Nov 13, 2011. 06:22 PM | Likes Like |Link to Comment
  • The Zombie Euro Marches On [View article]
    And it goes beyond just financial markets. I hope some day the world wakes up to the fact that the perpetual thumb-twiddling in eurozone has suspended long-term planning in economic and financial activities everywhere, and then screams at them to either get their acts together or just fuck it.
    Nov 12, 2011. 02:59 PM | Likes Like |Link to Comment
  • The Zombie Euro Marches On [View article]
    Good to see you again, Asbytec.

    The parallel is far from ideal, of course. I was only focusing on the points on fixed exchange rate and surplus/deficit relationship. US-China dynamic is hard enough to deal with, even with many more "degrees of freedom". This in my mind really highlights the impossibility of euro.

    We're blessed with the fortune of living in interesting times. (BTW, Confucius never said that.)
    Nov 12, 2011. 02:54 PM | Likes Like |Link to Comment
  • Apple's (AAPL) 3.1% loss in the past two days despite the S&P's 2.9% rally is even worse than it looks, the technicians say: Shares have fallen a relative 15% vs. the S&P in seven weeks, confirming a classic “double-top” reversal pattern and flashing a sell signal in the Moving Average Convergence/Divergence indicator. In the face of all that, who cares about production cuts?  [View news story]
    iToldya. Sorry, couldn't help.
    Nov 11, 2011. 06:08 PM | 3 Likes Like |Link to Comment
  • China's Intermediate And Long-Term Outlook [View article]
    jrhc, you brought up some very interesting points. This is really not the platform to discuss them in any meaningful depth. I've already strayed away too much. ;> I'll just say this here: while most of the western world has been exaggerating the rumor of China's demise, I think you might be giving too much credit to China. I think a more interesting question is how to balance social stability with development, and when the two goals may become incompatible with each other in China.
    Oct 18, 2011. 04:30 AM | Likes Like |Link to Comment
  • China's Intermediate And Long-Term Outlook [View article]
    Yes, that statement is a gross oversimplification.

    Nobody trusts the "party," come on. And especially the government officials who are of course overwhelmingly "party members." What the gov is trying to retain is some credibility to govern, e.g., control crime, control corruption, provide civil service, etc. In some of the areas they have been doing ok, some others they're struggling, and still others they're failing.

    Politics and governing are two very different things. Many people seem unable to distinguish the two. You can have very sensible and clean politics yet miserably incompetent governing, or vice versa. Examples of both abound.

    Prediction of China falling into chaos has been as ancient as the British dream of every Chinese buying one foot of Britain made cloth, or one ounce of opium as its later incarnation. With the exception of some relatively short, albeit very painful/brutal, periods, it has yet to materialize, much as the British dreams. I'm not alarmed by the "growing number of conflicts between citizens and the gov" -- I'm not sure to what extent this is due to the increasingly open nature of the Chinese society, thanks in no small part to the increasing penetration of cellphone with internet access, instant messaging, bloggosphere and the Chinese version of twitter.

    Another common mistake China observers make is the failure to distinguish the central gov and local govs. The dynamics between the people and those two are very different, again as a matter of historical political tradition, besides the universal part that's common to all big countries in all times. But that's whole 'nother topic.
    Oct 18, 2011. 04:13 AM | 2 Likes Like |Link to Comment
  • China's Intermediate And Long-Term Outlook [View article]
    The number is from 3 of my friends who are enterpreneurs, each employing a few hundred workers, mostly skilled blue-collar type. I mentioned it to numerous others and it seems to be the general ballpark everyone concurs. I'm sure the number differs for other categories, e.g. the increase for relatively well-paid white-collar type is definitely smaller, but I have nothing concrete.

    The driver is no doubt inflation, which started first (empirically speaking, picking up pace by 07 at the latest). Then in 08, after the Lehman crisis, Beijing panicked and started mass printing of their own.

    The wage pressure is really not for the gov to encourage or discourage. It just has to be, as a matter of necessity. I suppose the difference in wage increases among various sectors of the labor force reflects the relative supply and demand; it makes intuitive sense, but I don't have anything to support it. And my sense is that the gov at least does not discourage it. There've been numerous policy/legislative moves since early 08 that are obviously targeted toward shrinking economic disparity, although the reality has been going the other way.
    Oct 18, 2011. 03:32 AM | Likes Like |Link to Comment
  • China's Intermediate And Long-Term Outlook [View article]
    Let me guess, China would repeat the subprime crisis? ;>

    What happened in Mao's China was somewhat different from Stalin's USSR in this aspect, I think. He cleared the deck for a new generation of local government and ministrial leaders via cultural revolution. But they were not technocrats; they were anti-technocrats. About the only area where specialists could survive was defense-related.

    There was a surge in the interest/respect for science and technology in the 80's. It lasted for about 10 years and laid the foundation for the ensuing economic boom, along with numerous other factors. But now it's reverting back to the KeJu system. This is actually inevitable -- wise Chinese emperors of the past all knew this is the best way to maintain power. It's Chinese Politics 101.

    What's been happening in China in the past 5-10 years is a regression back to the State. Central government treasury has grown stronger and stronger; local governments have been stripped of their emerging economic independence, which directly accounts for the irresponsible growth in local government loan guarantees. State-owned enterprises are growing while private ones are struggling.

    I don't think it's nearly as bad as in Mao's time or the old emperial times. As long as there's space to survive outside of the system, there will always be some capable people who refuse to be assimilated. But it's a systemic elimination mechanism nevertheless.
    Oct 17, 2011. 05:32 PM | 1 Like Like |Link to Comment
  • China's Intermediate And Long-Term Outlook [View article]
    Well, in China it's always been the case, thanks to the KeJu (national civil service selection exam) system in place since 600AD. It was officially abolished at the beginning of 20th century. But the practice has gone on in other forms. From the governance point of view, this is brilliant; you absorb the capable people from the society into your system, otherwise they'd be out there making trouble for you. And it serves as a persistent, if narrow, channel for socioeconomic mobility. But from social development point of view, this directly causes the stagnation of development on all aspects of society.

    I believe this is the single most important factor underlying the amazing stability and resilience of the Chinese sociopolitical structure on one hand, and the dramatic slow-down (or almost complete destruction) of innovative force since the Warring States era on the other.

    And no, it's not sad. It's beyond sad.
    Oct 17, 2011. 03:58 PM | 1 Like Like |Link to Comment