Here's a joyful little article.
The township of Huaxi in the Yangtze River Delta is a proud symbol of how Chinese communists embraced capitalism to lift 300 million people out of poverty during the past three decades.
Its leaders took a farm community with bamboo huts and ox carts in the 1970s and transformed it into an industrial and commercial powerhouse where today many of its 30,000 residents live in mansions and most have a car. Per-capita income of 80,000 yuan ($13,000) - almost four times the national average - allows Huaxi to claim it's China's richest village.
Huaxi is also emblematic of the country's construction and real estate boom. Communist Party officials there are building one of the world's 30 tallest buildings, a 2.5 billion yuan, 328-metre tower. The revolving restaurant atop the so-called New Village in the Sky offers sweeping views of paddy fields, fish ponds and orchards.
Marc Faber, publisher of the Gloom, Boom & Doom Report, says China is overdoing it. "It does not make sense for China to build more empty buildings and add to capacities in industries where you already have overcapacity,'' Faber told Bloomberg Television. "I think the Chinese economy will decelerate very substantially in 2010 and could even crash.''
Huaxi has an even more ambitious project coming up: a 6 billion yuan, 538-metre skyscraper that would today rank as the world's second tallest. The only loftier building is the new Burj Khalifa in Dubai.
The rest of the article explores how China's economy is a bubble that's waiting to burst. When it bursts, you can bet your bottom dollar and the fair few above it that the commodities market will collapse and with it, Australia's shares, and then property and then its much-vaunted banking system. There's a chain reaction waiting to burst Australia's property bubble right there. Mightn't be such a bad thing if it didn't come with massive loss of jobs and all the ugliness that would entail. One thinks the current situation is merely a prelude to the dam walls bursting and this time Australia's right in the way of the on-coming flood. Oh joy.
Although this column flies in the face of this article in the same paper here.
The central bank has already got a head start on inflation, lifting its key cash rate by 75 basis points late last year while most developed nations held their rates at record lows. RBA Governor Glenn Stevens last week made it clear rates had further to rise this year should the economy strengthen as he expected.
Indeed, mining is a major reason for the RBA's upbeat economic outlook as insatiable demand for Australian commodities from China and India fuels a surge in investment.
In today's speech on "Mining Booms and the Australian Economy," Mr Battellino said past booms had not lasted more than 15 years before petering out. He dated the start of the current boom to 2005 but said this episode could last longer.
"On this occasion, the growth potential of countries such as China and India suggests that the expansion in resource demand could continue for an extended period, though this will depend at least to some extent on the economic management skills of the authorities in these countries, not to mention our own," he said.
He noted that mining investment as a share of gross domestic product was much higher in this boom than in the past and that the boost to Australia's terms of trade had been much larger. Both the price and volume of Australian exports, like iron ore and coal, had risen strongly during the current upswing.
So, until the wheels fall off China, we stand to make a lot of money, I guess.
More Fear And Loathing In China
Here's an interesting article.
China has so far survived the global economic downturn with hardly any of the agitation many once feared it might cause among unemployed workers or jobless university graduates. The economy grew at a very robust-sounding 8.7% last year and is predicted by many to be on course for similar growth in 2010.
Sweeping changes are due in the senior leadership in 2012 and 2013, including the replacement of President Hu Jintao and of the prime minister, Wen Jiabao. But if a struggle is brewing, signs of it are hard to spot. An unusually high-profile campaign against organised crime by the party chief of Chongqing municipality, Bo Xilai, has raised eyebrows. Some speculate that it is part of a bid by Mr Bo, who is a Politburo member, to whip up popular support for his promotion to the Politburo’s all-powerful Standing Committee in 2012. An online poll by an official website chose Mr Bo as the “most inspiring voice” of 2009.
But Andrew Nathan of Columbia University in New York does not see this as a challenge to the expected shoo-in for Xi Jinping, the vice-president, as China’s next leader, despite Mr Xi’s failure last year to garner the leading military post analysts thought would form part of his grooming. Li Keqiang, a deputy prime minister, still looks set to take over from Mr Wen in 2013.
Against this backdrop of political stability and economic growth, the most credible interpretation of the government’s recent hard line is that the forces pushing its leaders towards greater liberalisation at home and sympathetic engagement with the West are weaker than had been hoped. Nor is there any sign that the next generation of leaders see their mission differently. As Russell Leigh Moses, a Beijing-based political analyst, puts it: “The argument in policy-making circles where reform is concerned is ‘how much more authoritarian should we be?’ not ‘how do we embark on Western-style democracy?’”
Hmmm. It really comes down to control and China's Communists are trying to retain their Totalitarian stance on civics while trying to go capitalist on the finance which is inevitably leading to these kinds of issues. It would be nice if China could come off the ledge a bit and be more tractable but the Communist Party is essentially using the threat of the West to keep its control going which in turn means it benefits greatly from being intractable.
I guess it's a kind of massive irony that the free market world has come to depend so much on what is essentially a 1930s-style totalitarian regime.
Climate Change Articles
Another cool entry in The Economist.
Phil Jones did not say there had been no global warming since 1995; he said the opposite. He said the world had been warming at 0.12°C per decade since 1995. However, over that time frame, he could not quite rule out at the traditional 95% confidence level that the warming since 1995 had not been a random fluke.
Anyone who has even a passing high-school familiarity with statistics should understand the difference between these two statements. At a longer time interval, say 30 or 50 or 100 years, Mr Jones could obviously demonstrate that global warming is a statistically significant trend. In the interview he stated that the warming since 1975 is statistically significant. Everyone, even climate-change sceptics, agrees that the earth has experienced a warming trend since the late 19th century. But if you take any short sample out of that trend (say, 1930-45 or 1960-75), you might not be able to guarantee that the particular warming observed in those years was not a statistical fluke. This is a simple truth about statistics: if you measure just ten children, the relationship between age and height might be a fluke. But obviously the fact remains that older children tend to be taller than younger ones, and if you measure 100 of them, you'll find the relationship quite statistically significant indeed.
What's truly infuriating about this episode of journalistic malpractice is that, once again, it illustrates the reasons why the East Anglia scientists adopted an adversarial attitude towards information management with regard to outsiders and the media. They were afraid that any data they allowed to be characterised by non-climate scientists would be vulnerable to propagandistic distortion. And they were right.
There's this really cool one in the SMH.
If there were a typo in The Origin of Species by Charles Darwin, would that nullify the theory of evolution? If an email were stolen from one lung cancer specialist that showed frustration with tobacco lobbyists, would this prove that all cancer specialists around the world were in a conspiracy to destroy cigarette companies? If a tennis ball is filmed only after it bounces and is moving upwards, does this disprove the law of gravity?
Obviously the answer is no, no and no. Yet the deniers of climate science desperately hang on to a few drops of so-called proof to claim the entire ocean of evidence is flawed.
These minor errors do not invalidate the work of scientists from around the world who are screaming from their combined rooftop that human activity is warming the planet. Hundreds of scientists from more than
100 countries whose work is peer-reviewed by hundreds more are apparently all in a global conspiracy to make us pay more for electricity. The insects they study that are migrating earlier or travelling higher up mountains due to enhanced global warming must be in on the conspiracy, too.
Do people who question climate change science do so in other areas of their lives? Do they refuse a doctor's advice when seriously ill? Do they question aeronautical engineers before they board a plane? Or do they mistrust science only when it points to global catastrophe?
Witty dude, this guy.
Cate Blanchett Says...
... The arts is more than just another industry. Here's the link.
Anyway, what else do we know, and have studied and measured? We know that countries with strong cultural identities demonstrate greater social cohesion and on and on and on. Basically, all sorts of studies have been done, key-performance indicators, measured and indeed graphed.
But there is more. We do more than all that. We must remember the arts do more than just that. We process experience and make experience available and understandable. We change people's lives, at the risk of our own. We change countries, governments, history, gravity. After gravity, culture is the thing that holds humanity in place, in an otherwise constantly shifting and, let's face it, tiny outcrop in the middle of an infinity of nowhere.
What I'm saying I don't think anyone would deny, and yet no one seems prepared to constantly value that we give people the chance to make sense of the experience of their lives, their brief lives, and the tool to communicate that unique sense in another person or people.
This insistence on the importance of experience itself is a feature of these witnessing books and these witnessing lives, an insistence that history is not a concept or a force, but the brief, limited, unimportant lives of ordinary men and women involved in the business of just getting from one day to the next, just this, repeated a million times over.
Nice shot, Cate, but it isn't terribly convincing.
This country is about growing stuff and selling it, or digging stuff up and selling it or about building houses and living in it while we keep jobs to do with growing, digging or building. The rest of Australia is just servicing these simple needs. Anything above and beyond that, like a cultural industry is for wankers and should not be tolerated. Such pretensions are considered part of the old world and are considered part of the evils of the class system and more toffee-nosed wankers getting by without doing a hard-day's work growing or digging or building. That's the Australia I know, and that's the way most people want to keep it as far as I can tell; so Cate, your observations are falling on deaf bogan ears.
You're lucky you don't get killed like you were some stray dog in Leichhardt, like this poor sod.
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