Dedicated to my late brave, beautiful and silly mummy, Debra Ross. I love you mumster.

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Category archive for economics

Because archives are so much easier than having just hundreds of posts on the home page. I learned that the hard way.

3/700ths of a Wall Street bailout will feed every child

Josette Sheeran from the World Food Programme on the Late Show with David Letterman

Sometimes you post comments about how you’re going through a crisis of your own, only to see something that completely puts developed world problems into context.

First a bit of background: Channel Ten in Australia presents a 24 hour delayed telecast of the Late Show with David Letterman from the States on most weeknights which I treat myself to watching after a day of working and studying. Tonight, alongside The Virgins (a band I instantly liked after hearing less than 5 seconds of the song they played) and Anne Hathaway (call me… please?) Dave also had on Josette Sheeran from the World Food Programme.

It was without a doubt one of the most inspirational interviews I’d ever seen. They discussed the plight of starving children from Myanmar to Darfur in Sudan, and how by the WFP’s calculations $3 billion these children could be fed.

$3 billion could feed every child on the planet. Let me say that again.

$3 billion could feed every child on the planet.

My thoughts turned to the nauseating $700 billion plan to bail out the arrogant bankers who exploited people through lax legislation, and it managed not only to boil my blood but turn the mild headache I had at that point into a migraine. $3 billion is NOTHING.

From the site URL they posted on the programme:

Josette Sheeran from the World Food ProgrammeWelcome! You may have just seen me on the “Late Show with David Letterman” where I was talking about hunger and the frontline work of WFP. It is WFP’s goal to put hunger out of business. Together we can do this. Just 25 cents a day or 50 US Dollars a year can ensure that children have a nourishing cup of porridge in school - virtually transforming their lives.

WFP is as effective as it is efficient. 93 cents out of every dollar goes directly to getting food to those who need it. WFP is pioneering solutions to hunger including purchasing 80 percent of the food we buy from developing world farmers. This is a win-win that can break the cycle of hunger at its roots.

I have just come back from Haiti, which has been devastated by series of four hurricanes and tropical storms over a six-week period. I saw people in Gonaives walking knee-deep in grey-brown mud, and escaping to the refuge of their roofs, where they are living as they wait for water to recede and mud to dry.

Their children need your help now. Any contribution you can make will go to school meals. You can be part of the solution now.

Josette Sheeran
WFP Executive Director

Now to business. It’s not often I explicitly tell people to do something, but I’m ordering you to do this right now.

If you have a credit card that has even $5 remaining on it, go to The World Food Programme website, click on "United States" or "Outside the US" depending on where you are, and donate some money. I was saving my credit card balance for a new internal hard drive for my laptop, but I’m giving the money to these folks instead.

I wish the United Nations and the World Food Programme the best of luck in their efforts. If they’re part of a conspiracy to instigate a New World Order, I’m look ing forward to it. Time to put aside this 19th century mindsent nonsense that countries are still relevant in this day and age and start helping… people.

United Nations C-130 Hercules transports deliver food to the Rumbak region of SudanFrom Wikipedia: United Nations transports deliver food to Sudan

At least Australian banks are weathering crisis just fine

Prime Minister Kevin Rudd in New York, 25th September 2008
Prime Minister Kevin Rudd in New York, 25th Septemter 2008
Photo from The Australian

With all the gloom and doom reports coming from across the Pacific in the United States with regards to the Subprime Mortgage Crisis and the string of unavoidable but nonetheless nauseating bailouts we’ve all heard about by now, it’s good to know that our own banking system and financial institutions in Australia are weathering the storm just fine. According to the Business section of The Australian paper and a recent report from the Reserve Bank, we’re actually in a relatively sound position:

“[Australia's] banking system is soundly capitalised, it has only limited exposure to sub-prime related assets, and it continues to record strong profitability and has low levels of problem loans,” it said.

The mostly upbeat report came a day after the International Monetary Fund issued a similar glowing assessment of Australia’s economy, fiscal settings and the resilience of its banks.

The RBA indicated that it, like many others, has been surprised by the extent of the financial crisis now sweeping global markets, but Australia’s banks were set to ride out the worst of it thanks to strong loan books and limited offshore exposures.

Unfortunately as I had suspected the global distrust and fear of banks is having an impact on Australian banks despite solid domestic performance. It’s another example of panic eclipsing common sense and actually doing research into companies you’re sinking money into.

For all the talk of lax regulations in the United States causing problems, I can’t help but think it has to do more with greed and general slackness. Again from the article:

[...] the central bank highlighted a few areas of the financial system hurt by the global turmoil.

“Australian Bank share prices are down considerably and banks’ funding costs have increased significantly,” the RBA said.

Bank bad debt provisioning has risen, but the ratio of banks’ problem loans to total assets remains below the average since the mid-1990s, “a period of unusually low credit losses”, it said.

In line with its recent comments on the economy, the central bank said that household balance sheets were entering a period of consolidation due to tighter financial conditions, but households were still drawing benefits from low unemployment rates and solid incomes growth.

Some stress signals are emerging for the mortgage belt, although these are minor compared to those in the United States.

This of course prompted the relaxing of interest rates from 7.25% to 7.00% earlier this month.

And to end this post, as if I needed an excuse to show something cool from my iPhone, here’s a screenshot of the Stocks application showing common indexes:

iPhone Stocks application

RBA drops interest rates by quarter percent

UPDATE: It’s now official: the Reserve Bank of Australia has lowered interest rates by one quarter of a percent.

I know this is supposed to be a technology weblog, but I’m also studying economics and like to keep on top of developments. Does that make me more or less of a loser?

Economists in Australia have been waiting for this day for a long time and we’ve all been speculating what the Reserve Bank would be doing on said day. Since 2001 the RBA has incrementally increased interest rates to curb Australia’s stubborn inflation fueled mostly by domestic demand. While the world has gone through several notable economic corrections and booms over the last decade and a half, Australia hasn’t suffered a recession in more than 16 years.

ASIDE: Some attribute this uninterrupted period of growth to the policies of John Howard’s conservative government which was in power until last year when Labor took the reigns again. I’m skeptical!

Back to today’s news though, analysts have long predicted an end to this seven years of rate rises with a cut of one quarter of a percent. The leader of the conservative opposition Brendon Nelson wants a double half percent cut, and even went as far as to recommend it to the Reserve Bank, despite acknowledging that he supposedly respects the nonpartisan independence of the RBA and that if he were the prime minister he wouldn’t be issuing the advice. Our current PM Kevin Rudd took him to task for the comment with another brilliant speech to parliament, but I have to admit Nelson did set up the pins for Rudd to knock over!

Despite the oil price falling in recent days, overall we’re still looking at high levels which have putting pressure on almost all consumer goods prices. Transport costs are through the roof and few manufacturing and service industries have come out unscathed. Much of the inflation in Australia in recent years can be attributed to this relatively inelastic commodity, but according to an ABC News report, even factoring out the oil price inflation is rising, despite an overall drop in August.

I think it’s safe to say the Reserve Bank will be very cautious with any adjustments to rates, and that a prediction of a quarter percent drop is feasible. Inflation is still above 4% which is far in excess of the RBA’s target band of 2-3%, but consumers are demonstratively finding it harder to make ends meet now even compared with a year ago.

As a direct result, last night the Aussie dollar dropped to below US$0.85 for the first time in a year which will help exporters and improve our terms of trade. For my own selfish purposes, I’m hoping the falling interest rate in Australia will allow me to sell my existing Singapore Dollars for more, given that I got such a lousy return when I arrived here last month!

Obligatory Illuminati Section

At this point I feel obligated to say that the Reserve Bank in Australia, just like the Federal Reserve in the United States is part of a worldwide conspiracy to concentrate power into the hands of the Illuminati, a group of people I exposed for their evil in a previous post… uh, yeah!

By using proven techniques such as assuming correlation equals causality, conveniently denouncing the capacity for peer review using the justification that teritary instituions and councils are controlled by the Illuminati too… wait we still can’t prove it. But you’d better believe exactly what we say without question otherwise you’re a duped sheeple because the definition of "duped" is the need for evidence before a belief is upheld, right?

How much wood could a woodchuck chuck if a woodchuck could chuck wood?

Back in Adelaide, world business rant

I’m currently in the process of moving to Adelaide for my next 6th month study period ending around Christmas. I’m typing this at Adelaide Airport (the new one that I Twitter messages from my phone.

Adelaide
Photo of Adelaide: the colour saturation might be slightly off!

We went via Perth and spend a few days there, Perth really is a beautiful place. If I weren’t already halfway through studies here I would seriously consider studying there! Again I’ve got some photos but the internet here isn’t reliable enough to let me upload huge file right now. Stay tuned.

I’m missing Singapore, and KL, and Asia already, but we went to IKEA this afternoon and it felt as though we were right back there again! When people say how the world is becoming so generic as a result of companies setting up shop in multiple countries, a part of my appreciates the fact I can walk into a Starbucks and an IKEA in Adelaide, Singapore or KL and I’m in a familiar environment and I can order the same stuff… it’s very comforting in a 1980s born child who’s living in a place where he didn’t grow up and who seems to be a hopeless consumerlittle commonality is good, right? It’s okay to be alright with at least some of this right?

Perhaps I should just stop talking before I dig myself even deeper into this hole.

Cheerio everyone :-).

JB Singapore urban rails: about time!

The always impartial, unbiased and reliable Channel News Asia is reporting some good news in Singapore-Malaysian relations specifically related to Johor Bahru

SINGAPORE: Prime Minister Lee Hsien Loong has responded positively to a suggestion by Johor’s Chief Minister Abdul Ghani Othman to link up the urban rails of Singapore and Johor Bahru.

[Some of the] issues discussed between the Singapore and Malaysian foreign ministers is how to further integrate the economies of both countries and to enhance connectivity across the causeway.

Johor Bahru, Malaysia
Photo of JB taken from Wikipedia by PM Poon

Having lived both in Singapore and Malaysia since the mid 1990s I’m used to hearing a lot of big talk and not much progress on most matters of collaboration, which even just from an economic perspective is such a shame. With so much competition from other players in Asia for the industries and services that Singapore and Malaysia both provide, it seems now that collaboration should be a top priority.

ASIDE: For my readers who aren’t from around these parts, JB is the near universally used name and acronym for Johor Bahru which is the closest Malaysian city to Singapore, separated only by tiny Straits of Johor.

Wikipedia articles on: Johor Bahru, Malaysia, Singapore.

Take Australia and New Zealand as an example: They’re separated by a strait of water (albeit somewhat larger!) and have roughly similar populations to Malaysia and Singapore respectively, but the difference in the amount of trade is huge! Now granted their economies are at different levels of development and the makeup of their exports and imports are different, but it shows that countries with a shared heritage can benefit each other even when socially and politically they may differ in many ways.

Singapore, Batam and Bintan on Google Earth
Google Maps imagery of Singapore and surrounds. The white stripe superimposed over the Straits of Johor is the national border between Singapore and Malaysia which is part of the Asian mainland.

Like it or not, Singapore and Malaysia are neighbours, and the only way they’ll each succeed in the long term is if they cooperate. Some more decent connections between JB and Singapore would be a good start.

Africans are genetically inferior? Codswhallop!

Angélique Kidjo

Angélique Kidjo, in my opinion one of the most talented vocalists today.

I admit I only just read today on Truemors about how James Watson, a Nobel prize winner for his work on DNA research, blames Africa’s economic, health and political woes on their “generic inferiority”, but after some brief further research it already seems to be a hot issue across the internet and even on the local news here in Singapore.

There’s probably nothing much else that I could type here that hasn’t already been said somewhere else online about now, but even if you were to ignore the blatant racism and just focus on the economic side of it, it makes a mind boggling lack of sense.

As I posted on Truemors, from the dozen or so African people I know personally and seeing what is coming out of Africa, it seems to me they’re the most creative, resourceful, warm and artistic people on the planet. We should all be as “genetically inferior” as Dr Watson said.

Africa’s long term economic problems have as much to do with the genetic makeup of her people than Ruben has to do with girls in general. To even entertain the notion that somehow Europe’s meddling and resulting international borders which divide the country along colonial borders not on cultural or historical lines have nothing to do with it, or the corrupt governments have nothing to do with it, it’s just their genetics… it boggles the mind.

Then again Denial isn’t the only river in Egypt is it?

Singapore, landscaping, transport and such

Originally posted on my assessed study blog.

This morning over an Americano and an almond biscotti at the Coffee Bean I was reading the Straits Times (Singapore’s main newspaper) and came across an article originally published in the Vancouver Sun by Michael Geller:

While we often hear people ridicule the country for its public prohibitions - new chewing gum, no spitting, no littering - Singapore has to be the cleanest country in the world.

During my stay I did not see any litter on the streets, despite the daily handout of flyers and the presence of numerous fast-foot outlets.

There is no graffiti; the streets are beautifully landscaped and maintained. Singapore is also one of the safest cities in the world. I think there’s a connection.

Ruben does economicsHe goes on to talk about the automatic electronic toll systems, urban planning and so forth; suffice to say from the viewpoint of someone who as lived here for more than a decade nothing that was said surprised me, but it made me think a bit more about what I took for granted here.

As with the article on the opposite page about New Yorkers and Londoners having a low environmental impact because of their use of public transport, I believe a large part of Singapore’s success stems from it’s very dense urban structure. As a country with less land than my grandfather’s rural town in northern New South Wales, planners here didn’t have the luxury of sitting back and allowing urban sprawl because every square kilometre is valuable. The potential opportunity costs for each parcel of land are enormous, and each decision as to what should be done with a parcel of land must be given far more thought.

The end result of this dense urban structure is efficient public transport is made possible, and the micromanagement of public grounds that would be ridiculously expensive in an urban sprawl setting are economically feasible; not to mention the provision of utilities, internet access and so forth.

Singapore and Manhattan are restricted by their physical land space, London by its green belt and government control, and other very densely occupied cities for their own reasons by their very nature work because they allow people in a small amount of space to get about their business with much less effort and environmental impact. There’s no need to drive for hours to get from your suburban homes to work or shops, because you’re living right where your work is!

Some may argue that high density living isn’t really living; my father for example longs for the days when we had large houses in Australia, but I for one much prefer it. I’m 21 and I’m still on a learners driving licence, but it by no means restricts where I can go here.

I guess I’ll always be a city slicker ;).

The urge to visit Ras al-Khaimah

And now for something completely different: I have the sudden and uncontrollable urge to visit Ras Al-Khaimah (official portal, Wikipedia page)!

280px-flag_of_ras_al-khaimahsvg.png

Seriously though, I was sitting in my room doing some Ruby programming work over my third coffee of the day (as you do) and my mum was in the other room watching a Channel News Asia special on the growth of Ras Al-Khaimah in the UAE. To tell the truth I knew of its existence but I really only knew about Dubai and Abu Dhabi in any great detail out of all the Emirates.

Really shows though how fast the world outside the West is growing. They look like they’re doing some amazing stuff… to use the formal economic language of course.

Anyone able to lend me some money? Anyone? Don’t all crowd around in a hurry. From what I understand Dubai’s international airport is fairly close, and Ras al-Khaimah has it’s own as well, so I could fly there direct from Singapore on SIA. Wonder if RAK will go to Singapore?

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