Unemployment Rate Worse than it Seems

According to this NY Times article, even though the employment rate is currently at 6.7%, it may actually be worse than that, because it doesn't consider those people who want to have a job, but have given up.  There is another measure of employment, that includes these people (people who have looked for jobs in the past year), as well as people who are working part-time that want to work full-time, and that unemployment rate is 12.5%, the highest that it's ever been since they've begun measuring it.  I think that this high unemployment rate is just going to make the economy worse and worse-as more people get laid off, they won't be able to buy things, meaning that companies will have lower profits and be forced to lay off even more workers, and so on.  When will it end?

Asking for MORE!

We have talked about the auto bailout several times. The Big Three car companies have previously asked for $25 billion, and now they just increased the request to $34 billion. The executives have admitted their mistakes, and promised to restructure their firms and pay off debts.
Congressional budget analysts, however, have privately told top Democrats that tapping that program wouldn't come close to covering the $34 billion that carmakers now say they need to survive. It would yield only $10 billion to $15 billion in short-term loans, the analysts claimed, according to congressional officials who spoke on condition of anonymity because they were not authorized to disclose the analysis.
We'll see how far the Big Three can push for more.

Man killed for 'hogging karaoke'

I know it sounds like something out of a Judd Apatow movie, but it is real. Abdul Sani Doli, 23, was stabbed to death in a fight over microphone control at a karaoke bar. His body was found a short distance from the bar.

Having lived in the nation that gave birth to karaoke, for a year, I can say some people are VERY serious about their karaoke.

Smarter guys have better sperm

A team from the Institute of Psychiatry analyzed data from former US soldiers who served during the Vietnam war era and found that those who performed better on intelligence tests tended to have more mobile sperm, concluding if tiny mutations impair intelligence, they might also harm other characteristics, such as sperm quality. Scientist thought originally lifestyle had a larger effect on sperm effectiveness.

It doesn't surprise me a bunch of science nerds are going to claim that the more intelligent soldiers had more mobile sperm. A little of a catch-22 for women in choosing men.

Pakistani blast reeks havoc

A bomb containing 20-25kg of explosives designed to spread fire has killed at least 20 people and injuring another 70 in the north-western Pakistani city of Peshawar. The blast hit a heavily populated area outside a Shia mosque near the central Kissa Khwani bazaar.

Although it is not immediately clear who was behind the attack, authorities attribute it to recent sectarian violence and fights between the army and Islamist militants.

OJ goes to Jail

Ex-US football star OJ Simpson was sentenced to life in prison, naw I'm just playing. He has been sentenced for 15 years for the kidnap and armed robbery of two sports memorabilia dealers at a Las Vegas hotel.

To me I watched the tape and actually felt kind of sorry for him. But the Judge thought differently. She described Simpson as arrogant and ignorant, and said the evidence was overwhelming.

Simpson claims he was just reclaiming his own possessions from the plaintiffs, whom he had known, however his convictions include:

Conspiracy to commit a crime

Conspiracy to kidnap

Two counts of first degree kidnapping

Burglary in possession of a deadly weapon

Two counts of armed robbery

Two counts of assault with a deadly weapon

More Job Losses for November

It is being reported that US employers have had to lay off 533,000 jobs in the month of November. This is the biggest monthly cut since 1974 according to the US Labor Department. The unemployment rate is now at 6.7%. No one has seemed to really care what the President has to say anymore but the President-elect has been quoted "There are no quick or easy fixes to this crisis, which has been many years in the making, and it's likely to get worse before it gets better." Not to take anything from him but Steve Forbes has been quoted "the worst is over". Does anyone seem to think they know what he's talking about? Is he just trying to instill confidence? There's gotta be a more savvy way to do it!

The ripple effect

Its amazing how a recession here affects everyone, from Europe to Asia to Latin America. Every single news article I read is about how real estate prices around the world have collapsed, bringing down the rest of the economy with them. Just recently, Dubai was in the news spotlight, and the article was foreboding Dubai's real estate collapse, with numerous buildings including the "worlds largest mall, world's largest hotel" etc having trouble with financing to keep the construction going on. Even in latin america, the news articles are filled with how Brazil, Venezuela and Argentina will brace their economies from the impact of the recession. Whats universal about the article, and this is a good point, is that these economies have learned from their prior mistakes, and have shored up their governments from eventual debt traps.
The real question here is, is this a systemic occurrence where people use high real estate prices in America as a cue for bidding up their own prices. And when capital suddenly dissappears from markets all around the world, I'm talking trillions of dollars in debt lines, whose really cashing out their money?
Does all the capital in the world originate in America, or does American capital dictate how all the capital in the world is to be distributed?

Automaker CEOs back for round two

The CEOs of the big 3 (Ford, Chrysler, and GM) were back in Washington this week to appear before Congress for the second time. This time they arrived via hybrid cars, as opposed to the private jets they arrive din last time. They have promised to make cars with low emissions, to accept $1 a year salaries, and to sell their private jets.

The article says "that they will get something is not in much doubt". I'm personally glad to see that the CEOs are holding themselves a bit accountable, especially since they know they are going to get money. To show up in DC to ask for money from Congress in a private jet (with the salaries they have) is insulting.

I don't think I would support this bailout if it weren't for the current condition of Detroit. I don't follow the news too much, but from what I've heard the city is doing terribly since the auto industry is failing. Even their football team, the Lions, are predicted to not win a single game this season, becoming the first team in NFL history to go winless for an entire regualr season. Basically the city is struggling in all aspects and needs this money.

U.S. Retail Sales Fall in Worst Drop in Four Decades

This article talks about how bad retail sales were over the last week. Typically, the Friday after Thanksgiving (Black Friday) is one of the largest shopping days of the entire year. However, this year, as the title of the article suggests, stores posted the worse revenues in four decades. Many stores posted huge losses. The Gap for example was down 10% from last year. Wal Mart however was one of the few stores that actually did increase revenues. They were up 3.4%

I'm really not surprised to hear this. Many of these stores' products are very elastic, meaning I think people can definitely go without them. Abercrombie and Fitch for example said they didn't want to offer sales because they didn't want to change their brand image. I think people turned to WalMart because it is a cheap alternative to all of these other companies.

Katrina Kids: Sickest Ever

This is an article by Mary Carmichael of Newsweek. It is about the long-term health effects of Hurricane Katrina on the children of Baton Rouge and elsewhere.

The children are "the sickest I have ever seen in the US.," says Irwin Redlener, president of the Children's Health Fund and a professor at Columbia University's Mailman School of Public Health.
"Forty-one percent are anemic-twice the rate found in children in New York City HOMELESS shelters, and more than half the kids have mental problems, 42 percent have respiratory problems. The list goes on, and it is said that the trailers distributed by FEMA have even contributed to the problem.

These people just can't catch a break and if they ask for one all hell breaks lose, in the richest country in the world. I think people need to understand the value of social programs. It is more than just compassion or equality. You could even think about it in economic terms. If you want a certain sector or industry to do well what do you do? You invest in it. Anything, from a house, a car, to people. You want to increase the value of anything you invest it. If want to maintain our place in the world we have got to invest in our people. ALL our people. Or we most certainly will ALL lose.

Turning the Big Three into the Big One?

This is an article in the latest issue of Newsweek by columnist Keith Naughton. He proposes the idea of turning the Big Three automakers into just one. He says doing this has many positive aspects like increasing profits of the most valuable brands like Chevy, Ford and Cadillac and leave the "clunkers" like Pontiac, Mercury, and Saturn, behind. He assumes that Chrystler could fall and leave Gm and Ford left, which could combine and compete with Toyota and rest.

Some negatives are the 2.5 millions jobs they are responsible for and the strong labor unions behind them. Also "fiercely independent dealers and a complex network of suppliers". As far as the jobs are concerned I don't know how interested people are in the labor force, they never had a problem laying hundreds of thousands of workers monthly before. And it seems to just be delaying the inevitable if there is no plan of action. This is an interesting idea I never thought of before.

Bush Administration Forewarned of Mortgage Crises--Responce to last blog/My own Post

I remembered reading, in an article, a few days ago about how the Bush Administration was warned about all the activities going on in the housing sector and they did nothing. I was going to post a response to the last blog by COD but then I just decided why not make it my own post with the article. So I did...I would like credit for both though can we do that?

The Associated Press reported recently that the Bush Administration received ample warning from regulators to crack down on as well as some of the warnings even coming from within the housing industry itself, "Expect fallout, expect foreclosures, expect horror stories," was a warning from California mortgage lender Paris Welch back in January 2006.

In 2005, faced with ominous signs the housing market was in jeopardy, bank regulators proposed new guidelines for banks writing risky loans. Today, in the midst of the worst housing recession in a generation, the proposal reads like a list of what-ifs:

-Regulators told bankers exotic mortgages were often inappropriate for buyers with bad credit.

-Banks would have been required to increase efforts to verify that buyers actually had jobs and could afford houses.

-Regulators proposed a cap on risky mortgages so a string of defaults wouldn't be crippling.

-Banks that bundled and sold mortgages were told to be sure investors knew exactly what they were buying.

-Regulators urged banks to help buyers make responsible decisions and clearly advise them that interest rates might skyrocket and huge payments might be due sooner than expected.

However non of these recommendations were passed by Congress or signed by the president.

Now in terms of the question "How do I evaluate Mr. Bush" honestly I don't think about it much. He certainly is one of the worst presidents of all time. He has left us 3 crisis in his wake, Katrina, Iraq, and now this financial crisis. You could argue four if you wanted to count 9/11 which they also received warning about ahead of time. Those really are just the tip of the iceberg.

Prior to the 2004 election you couldn't get me to stop talking about how bad he was. He also wasn't my president. Anyone remember Florida? He definitely stole the election. But then Nov 2 2004 came and my country decided they disagreed with me. Since being in the minority (albeit a pretty large minority) who didn't think he was qualified, at least more than Kerry, I stopped complaining. The rest of my country didn't agree and that's how it works in democracy.

Bush is sorry about the financial crisis

"President George W. Bush expressed remorse that the global financial crisis has cost jobs and harmed retirement accounts and said he'll back more government intervention if needed to ease the recession."
The Bush administration and the Fed just committed another $800 billion to break through blockades on credit cards, auto loans, mortgages and other borrowing, raising the government's commitment to almost $7 trillion dollars.
In the article, Bush looked back at this presidency and appeared to evaluate himself. He admitted that the crisis is happening during his administration, but also noted that this is the result of decisions that took place a decade ago. He also said the biggest regret of his presidency was the "intelligence failure" regarding the extent of the Saddam Hussein threat to the United States, which led to the U.S.-led invasion of Iraq in March 2003.
There is always some types of criticism for any president. How do you evaluate Mr. Bush?

Slowdown may spur China to speed health care reform

With the $586Billion stimulus package on its way, China now has to face the problem of poor health care and welfare system. China's poor health care and welfare program forces people to save more for times if a family member should fall ill or lose their job, rather then spend, because the success of the Stimulus package very much depends on people's spending this economic slow down will pressure the Chinese government to address key issues such as improving health care and social welfare. The average cost of an admission into the hospital in China is equivalent to annual salary of the lowest 20% of the population, and China has only put of 1.8 % of their GDP of Public money into health care accounts compared to 6% around the world.
The problem with the Chinese health care system has been that the hospitals has been marketized, and the hospital often over prescribe and diagnostic to boost revenue causing over inflated hospital bills.
"They need to think about incentives. You need to get the incentives right, and you need to back those incentives up with supervision mechanisms." says Christopher Spohr, a social sector economist with the Asian Development Bank in Beijing.

Paying kids for Grades

On the Colbert Report last night, guest Roland Fryer discussed his plan within the Education Innovation Laboratory, at Harvard University, to help stimulate education by paying students for better grades. This idea is already being implemnted in schools in Washington, D.C., Chicago, and New York. The goal behind this plan is to give students the incentive to work harder in school by paying them for better grades.

For the most part, this seems like a well thought out and attainable plan, but one of the problems I see with it, as well as the one Stephen Colbert mentioned on the show, is what happends if students start to bribe other students to copy their hw, or even do their hw so they can get better grades? Money is a great incentive for these kids, who most likely live in the poorer areas of these cities, but perhaps there are better motivators to be used.

Obama new National Security Team

Finally the speculation can stop. Hillary Clinton is officially the appointee of the secretary of state post. Robert Gates will officially stay on as secretary of defense and James Jones a former NATO commander under current president Bush. A lesser known though equally cool is the appointee of Susan Rice to ambassador to the UN. Susan Rice has been at Obama's side since day one, in fact she is the only on of the appointees announced today that was! Sen Clinton was his arch-nemisis. James Jones supported John McCain and Robert Gates was appointed by president Bush. And before you think that it's president Bush doing the appointing, remember Robert said YES.

I do not have a problem with these picks. They really do seems like a nice counterweight to his views but will not overpower him. And of course his vice-president elect was chairman of the senate foriegn relations committee, so he is good on foriegn policy. You also can't say he is appeasing Hillary supporters anymore either. Although I do wonder what happened to Senators Sam Nunn, Dick Lugar, and John Kerry in all this? Guess they just didn't make the cut.

Even in times of hardship the EU cuts emissions

Earlier today European carmakers have agreed to a plan to cut global-warming gases from new vehicles by 18 percent within the next six years. Carbon dioxide emissions from new cars are to be cut to 130 grams per km (.6 mile).

Emissions will have to be cut around 40 percent to 95 grams per km by 2020. To reach that goal a set of fines have been set in place. 95 euros ($119.80) per gram per car sold for automakers that miss their target by a long way, but those that overshoot by less than three grams face modest sanctions of between 5 and 25 euros.

I think it's great that even when the EU had an opprotunity given today's economic climate to push climate change to the backburner they haven't, except Germany who in fighting for BMW and Mercedes will allow them now to be able to continue production of their biggest, luxury gas-guzzlers until 2014, this is to protect jobs and export earnings.

Job Losses Surge as U.S. Downturn Accelerates

Due to the current recession, there has been huge job cuts in many states. According to this article, it is expected that this job losses would accelerate the U.S. downturn of the economy.

As for Florida, there has been 156,000 jobs cuts over the past 12 months. This has weakened many state industry like housing and construction sector as well as business sector which had lost 47,000 jobs. In addition, district Columbia is facing over 8% of unemployment rate next month.

However, this job losses would not likely to occur in the energy states like Wyoming, South Dakota and Texas. These states currently have the lowest unemployment rates in the nation, around 3%. These states are may not face as much hardship as other states as the main industry demand which is energy is constant.

Vietnam Stock Index to test a new low in 3 years

The VN-Index hit a three-year low yesterday, while the Ha Noi market hit its lowest level ever, despite the Government's announcement late in the previous trading day that the nation's inflation rate had slowed for a second consecutive month.

The Index yesterday tumbled 8.59 points to close at 311.74, a loss of 2.68 per cent. Trading volume reached 11.74 million shares for a total turnover of VND352.5 billion (US$21.4 million).

The day's trading saw 129 losers and 27 gainers. Demand for shares has fallen sharply this week. Trading value averaged at VND277 billion per day over the first three days of the week, while it was VND483 billion per day during the first half of November, according to HCM City Stock Exchange data.

There was a possibility that the VN-Index would fall to the 300-point mark, said Kim Eng Securities analyst Ken Tai. "It's hard for the domestic stock market to rally in the short term," said Tai, pointing out that local investors were closely following international developments. Tai said the fate of Citigroup would have great impact on the world financial system, and added that he expected the US government would soon pass a rescue plan for the automotive industry, easing a burden the US economy. Declining world steel and petroleum prices were likely to affect the shares of firms that rely on these materials for production, he added.

EuroCapital Securities said in a report that, with the banking and property markets still facing difficulties, the imposition of new income and capital gains taxes on securities at the beginning of 2009 would be further discouraging to investors.

In Ha Noi yesterday, the HASTC-Index hit its lowest level ever, ending the day at 99.56 points, a massive 5.4 per cent loss. About 7.65 million shares changed hands on a turnover of nearly VND197 billion ($12 million).

AIG is making efforts to pay off its $150 billion debt.

American International Group Inc. on Monday said it has agreed to sell its wealth management arm AIG Private Bank Ltd. to Aabar Investments PJSC of Abu Dhabi.Terms of the deal, which is part of the New York-based insurance company's restructuring plans, were not disclosed.

"This sends a clear message to our customers that we will continue to be a trustworthy, reliable and competent partner for them," Chief Executive Eduardo Leemann of AIG Private Bank said in a statement. Leemann and his senior management team will remain with the bank, AIG said.

Faced with a liquidity crunch, AIG said in October it would sell off a number of business units to pay off a $85 billion government loan. The insurer's total government assistance has now risen to about $150 billion. The company has not specifically disclosed the assets it would sell or the expected prices from the sales. However, AIG has said it plans to retain its U.S. property and casualty and foreign general insurance businesses, and plans to retain an ownership interest in its foreign life insurance operations.

I wonder how many business units AIG has to sell to get $150 billion.

Why The Dollar Is Getting Stronger

Even with the current financial crisis where every country is facing economic hardship, the U.S. dollar is strengthened day by day. Why is it?

The main reasons that influences the strength of the dollar. First, a fear factor has been increasing the demand for the dollar. With the current financial crisis, the investors are buying buying safe asset, the U.S. dollar instead of foreign currencies that are risky. Due to the increasing demand the price for the dollar increases relative to other currencies. In addition to this, there has been concern regarding other emerging market currencies like yuan and euro. These two currencies has been strengthening over the years. However, the investors feel that the bubble may burst for these currencies, conversely benefiting the dollar.

This trend is expected to continue as the as the global economy would continue to face hardship.

Wall Street Firms Hold On To Interns During Crisis

Recently I came across this article which I think has some worth-knowing info for students like us. It talks about how firms on Wall St. hold on to their interns, hoping they'll be the ones who can save the firms in the future. The author also predicts that the economy will rebound in the next 12 to 18 months. For people who are interested in a career in finance or investment banking, this is definitely great news.

Link to the article

College Abroad, for More than a Semester

This article talks about the globalization of higher education, focusing on students from the US. There are an increasing amount of students traveling abroad to obtain their four year undergrad degree. The article points out and examines some of the pros and cons of studying abroad. The largest benefit for a student studying abroad for a full degree is the cost. A student from the US will pay far less at most prestigious international schools than they will at a comparable school in the US. The down sides of studying abroad can be a narrower range of studies, less individual attention, and a weaker alumni network after graduation.

The University of St. Andrews in Scotland had 1,230 US students of the total 7,000. A decade ago they only has 200. University of St. Andrews and other school alike now commonly have a squad of recruits in the states trying to bring students to their school straight from high school.

I think its great that more students are studying abroad for college. Its certainly a commitment, but the experience and money saving could far outweigh the cons.

Holiday season off to a modest start

The Thanksgiving shopping weekend doesn't appear to have been the disaster some had feared, but tempered buying and unprecedented deep discounts likely resulted in soft sales. Now, online retailers are ramping up heavy-duty deals to turn skittish shoppers into "Cyber Monday" spenders. The trade group National Retail Federation expects overall holiday spending will total about $470.4 billion, a 2.2 percent rise from a year ago and the slowest growth since 2002, and online retail is being hit along with brick-and-mortar stores.

While the crowds did come out to buy on Black Friday, many analysts say they were thinner than last year. Shoppers were also focused on bargains and smaller-ticket, practical items like blenders, apparel items such as sweaters and video games, as they worry about layoffs, tightening credit and shrinking retirement funds.

A more complete sales picture of how the Thanksgiving shopping weekend fared won't be known until Thursday, when the nation's retailers report November same-store sales, or sales at stores opened at least a year.

According to preliminary figures released Saturday by ShopperTrak RCT, a research firm that tracks total retail sales at more than 50,000 outlets, sales rose 3 percent to $10.6 billion on Friday from the Black Friday a year ago. While Black Friday isn't a predictor of the holiday season, it does act as a barometer of consumers' willingness to spend. Complicating matters is a shorter buying season -- 27 days between Black Friday and Christmas -- instead of 32 last year, putting more pressure on retailers.

A $1 Trillion Answer

After reading Globalization and Its Discontents, as the book essay assignment for our class, I just got so much interested in Joseph Stiglitz, currently a professor of economics at Columbia University. I like his view of the world, his mindset-care for poor-, and even his writing style. As a former chairman of the Council of Economic Advisers in Clinton Administation, he strongly believes that the government intervention(economic policies) is needed in case of the market failure, yet only with the right sequencing and pacing.

Here I would like to introduce a New York Times article about what Stiglitz thinks about the current economy and what the solutions are that he suggests.
Main Points is that a very big, yet WELL-DESIGNED stimulus is needed, at least $600 billion to $1 trillion over two years. Also, the government needs to provide health insurance to the unemployed and to the uninsured, and we need to do it quickly, possibly through an expanded and more efficient Medicare. Change the banks’ incentives or constraints is needed through judicious regulation.

Stimulus all the rage, bar Germany

As Washington, Beijing, Tokyo and the bulk of Europe began taking steps to prevent recession via government stimulus packages Germany; Europe's largest economy seems unwilling or reluctant to follow suit. Though Germany has lowered its interest rates to encourage spending, but no stimulus plan was announce. Jim O'Neill, chief economist at Goldman Sachs noted that since the fall of Berlin wall domestic spending of export-dependent Germany has remain pretty much the same. O'Neill claims that Germany should raise its wages and cut down on sales tax to support higher levels consumption to help easy this economic down turn.
Marco Annunziata, chief economist at UniCredit bank has said: "Germany's reluctance to pull its weight in fighting the global recession betrays lack of vision, lack of leadership, and a temptation to free-ride that, if widely mimicked, would truly condemn the world economy to a new great depression"
Germany will get a chance to defend its position next week when European Union finance ministers meet on Monday and Tuesday to discuss the EU wide fiscal stimulus package.

Judge allows civil suit over co-worker's perfume

I think it is nice to sit back sometimes, take a break from gloomy recession talk, and laugh at the US legal system. You read the title of this article right- this woman is filing a lawsuit against another woman who wore too much perfume. She claimed that she is extremely sensitive to cosmetics and perfumes, and that her co-worker's perfume made it difficult for her to breathe. This reminds me of the guy who broke into someones house, fell on a knife, and sued them for negligence... unbelievable.

Mumbai WILL bounce back

Yesterday I made a post where I said that the analysts and strategists in Mumbai, India were concerned that the terrorist attacks may have long term economic impact; however, today I read this article and it states the exact opposite. I think its interesting how everyday different predictions are made and I wait to see what really will be the after math of the attack.

The attacks definitely rocked the financial capital of India, depressing stocks, dampening tourism and slowing new investment, but analysts and business people on Thursday said that the attacks were unlikely to inflict long term damage on the nation’s economy.

Like I anticipated and stated in my previous post, this article states that intention of the attackers was to create panic and shatter the confidence in the minds of investors in India and global investors coming to India.

Analysts and business owners suspect that people will be scared and investors may balk as a consequence of the attacks, but they say that the foreign companies that invest in India are “too big to and well entrenched to consider a hasty exit.”

A partner at global consulting firm Grant Thornton who was supposed to be in the city on the day of the attacks was quoted as saying that the attacks definitely came as a shock and that there will definitely be some short-term postponement of people's investment plans, and perhaps people thinking of relocating to Mumbai will reconsider but medium- to long-term corporate investment would likely remain on track.” Mumbai is a very resilient city. Saturday everything will be running as normal" he added. Director of sovereign ratings at Standard & Poor's in Singapore stated that the attacks were a challenge to the Indian government to maintain law and order in the country and that at this stage, he didn’t think there will be any major impact on the macroeconomic or fiscal position of the government. Chairman of the Wockhardt pharmaceutical company was also quoted as saying that the attacks were a challenge to the economic resurgence in India.

Hence it is clear that the attackers had no intention other than just to create a ruckus and cause the India economy to destabilize. I wonder whether Mumbai will be resistant to this or will it let the attack affect the countries economy. I am hopeful that the city will bounce back but like I said in my previous post, I think this time is different. However after reading this article I get some reassurance.

Luxury goods sales to grow despite crisis: report

Despite the economic conditions around the world luxury good are expected to grow 8% this year and then slow down to an 6% growth in 2009 and 2010 said Paola Durante, head of corporate broking for Merrill Lynch in Italy.
Luxury goods are enjoying double digits growth in emerging markets and U.S and European has seen rising in the single digits. Analysts had lowered their estimates which they had expected 12 percent sales growth for 2008 and 10 percent for the following year at the beginning of the year.
"We can see there has been a cut in estimates but there are still expectations for growth even if at single-digit," said Durante.

The Pitfalls of Africa's Aid Addiction

This article presents a skeptical view of an African citizen on foreign aid. Sorius Samura argues that it is foreign aid that feeds off corrupted governments in many African countries, making Africa dependent on outside influences. "Governments that are highly dependent on aid pay too much attention to donors and too little to the actual needs of their own citizens."

I think it is yet another case of good intention, but failed deliverance. Foreign aid to Africa is not simply a matter of pumping money into Africa and hopes that this money blossoms into economic growth. A lot of foreign aid serves interests of corrupted leaders and brings little benefits to the average African person.

Foreign aid, the article argues, brought about a rise in the local currency and rendered the export sector less competitive. This impact, coupled with the West's "fair" trade agenda (demand for less trade barriers but maintain their own agricultural subsidies) explains why this continent of 10% world population only accounts for 1% of global trade, much less than its potential.

Aid to Africa should go beyond mere good intention.

Chinese job losses prompt exodus

In Guangzhou, one of China's manufacturing hubs, there has been an increase of 130,000 passengers leaving from the station everyday. This exodus phenomenon is caused by the loss of jobs in many factories.

The most badly hit export companies are toy, shoe, and furniture manufacturers.

There have been also reports of social unrests and demonstrations.

China's President fears the worst

Mr Hu gave a warning at a meeting of the Politburo that in the coming period China would have to confront the effects of the international financial crisis. Stating that the economic situation was a test of the Communist Party's ability to govern.

Growth has slowed to 9% and it is predicated to drop to 7% or 8% next year.

There is a widespread belief in China that growth needs to stay above 7% in order for social stability to be maintained. And they have taken action to do so.

This past week the central bank carried out the biggest cut in interest rates in more than a decade. And earlier this month, the government announced a stimulus package of $586bn (£380bn). This is enough, the Communist Party will hope, to get this country through the next year or two.

Wow. China is worried about their growth rate falling below 7%. Even superstitious about it! And they haven't even been doing that well for that long! That is a sign of one rich country right there.

Calls for resignations and cross party talks over Mumbai attacks

The Indian Prime Minister Manmohan Singh has opened cross-party talks on a federal agency of investigation after the Mumbai attacks. The attacks have caused 172 deaths so far. Including 22 foreigners from Israel, the US, Germany, Japan, Canada, Australia, Italy, Singapore, Thailand and France. Shivraj Patil's resignation was accepted by the prime minister but an offer to resign from the national security adviser, MK Narayanan, was turned down, with claims that it is too little too late.

I like the idea of the cross party talks, but I don't know about the resignations. I understand calling for someone's resignation because of how they dealth with the attack. But I wouldn't necessarily call for it because of the attack, unless some serious incompetence or complete neglect was shown like FEMA and Hurricane Katrina. Maybe even after 9/11 because the NSC did receive briefings that said Al Qeada was planing to fly airplanes into buildings. before it happened.