Citing Recession, U.S. Again Presses China on Revaluing Currency

An interesting article about how China refuses to revalue it's currency, and the effects it will have on US and other countries wanting to trade. This is just another issue recently that has caused a riff between China and the United States.

The Treasury Department is under growing pressure to brand China a currency manipulator in a report to be issued next month. That could open the door to retaliatory measures that could increase the cost of Chinese imports and raise the risk of a trade war between the two nations.

* Business * Europe Greek PM gives European leaders a week to produce rescue plan

This article brings up two points: First, the Greek government is unable to manage its own budget deficits, and Second, it has lost faith in the European Union to rescue it from the budget crisis. It's interesting how countries have lost the ability - at least in democratic states - to implement massive budget overhauls. And the Eurozone's inability to handle its first economic crisis since the Euro was adopted means there could be trouble for the fledgling currency.

Japan Eases Monetary Policy to fight Deflation

Japan still plagued by problem of deflation even as its economy grows for 3 straight quarters.

Google '99% certain' to shut China engine

This article is a good follow up to the previous articles on the google.cn saga. According to the article, top executives remain adamant on the removal of censorship by the Chinese government. Google makes it clear that it desires to stay and do business in China but will not bow to pressure to succumb on censorship rules. Currently, Google owns about 30% of the search engine market share in China. Google will nonetheless seek to continue other branches such as its research center in Beijing. However, there are concerns that the government will make staying and doing business unbearable for Google should it choose to pull out.

Reform Bill Adds Layers of Oversight

This article focuses on a bill that has been put forward by Senate Democrats and backed by the Obama administration that calls for financial regulations and a larger government role in Wall Street. This is not uncommon, usually when free markets fail there is a call for more government regulation, however this regulation should not take away incentives to for profits or efficiency.

Goal at Deutsche Telekom: More Women as Managers

Europe's largest telecommunications company, Deutsche Telekom plans to raise the number of women in senior and middle management to 30 percent by the end of 2015 and more than double the number of women who are managers within the next 5 years. The company's chief executive said " Having a greater number of women at the top will quite simply enable us to operate better." To take immediate action, the company plans to recruit more female college graduates and require that at least 30 percent of executive development openings be held by women. To lessen the stress of working mothers, the company wants to widen parental-leave programs and create more flexible hours for managers.

Green Shoots

This article discusses how private investment is playing a larger role in India's agriculture sector. For years, the the national government has been the driving force in all aspects of agriculture. The government would subsidize food, fertilizer, and fuel, but this has stagnated as prices have rose. Farmers would also sell their goods in price regulated markets run by the government. This has changed as private companies have come in and have taken over for the government, offering farmers higher prices than they would get in the government markets and helping with production. The article highlights McDonald's, who has spent years setting up supply chains for items like potatoes and chicken. India is a changing to accept new, westernized items and losing touch with many of their traditional ways.

This article demonstrates some of the negatives of having the government too involved in a market. When the government controls prices, they do not always reflect the prices that would result if markets were allowed to act freely. This is why the farmers can get more with private companies. This also shows that governments are not perfect for making economic decisions. Many people believe that having government control can lead to better economic outcomes such as efficiency. This article demonstrates that bringing in a private company led to more efficient farming. For example, farms selected for McDonald's use drip irrigation, which reduces the soil nutrients that are lost using the old method.

March Madness mayhem: Workplace help or hindrance?

This is an interesting article about the productivity of workers based on an externality - March Madness. This article/video focuses on the potential for companies to lose over a billion dollars collectively due to less work being done during March Madness for NCAA basketball. Although some argue that employers will lose money due to March Madness brackets, others argue that these games will create incentive for employees to come to work, thus increasing productivity. In the video, it states that March Madness creates a problem for employers because about half of all the games are watched during office hours, as well as the recent creation of an iPhone and iPod touch app that allows people to watch and get updates right from their pocket.

Employers Slowly Begin Hiring Temp Workers Permanently

This article discusses the new statistics out that employers are now hiring for the long term. This is a sign of recovery for the job market as the article states, "284,000 temporary jobs have been added since September 2009, according to the Bureau of Labor Statistics". This is an encouraging statistic but is still a slow recovery compared to past recoveries. The jobs that have the highest percentage of staying are those in the manufacturing sector. Let's hope that companies keep building this confidence for the future. This confidence will encourage consumers to keep spending money and getting rid of the negative animal spirits.

US, Russia: half of world arm sales

According to a Sweden-based research institute, the US and Russia, together, made up more than half of the global arms sales between 2005 and 2009. Compared to 2000-2004, the volume of world arms sales increased by 22 percent in the five-year period. The top four global arms exporters are as follows: US (30%), Russia (25%), Germany (11%), and France (8%). South Korea, the United Arab Emirates, and Greece were among the top-five importers of conventional weapons systems. China and India were the world’s largest arms importers in the period.

Newly powerful China defies Western nations

As China grows, most economists expect it to take a more Western, laissez-faire approach to its economy. Because this is the way the economic powerhouses like the United States function, it has long been assumed that China's businessmen would become increasingly more Western in order to both connect and compete. However, there now seems to be a growing trend in nationalization across the country. Instead of moving to a more capitalist economy, the means of production/private firms are being purchased by the government. There has been an increase in arrest for crimes related to state security and China is one of the most strict regulators of the internet. They have also condemned the United States for selling weapons and meeting with exiled world leaders, like the Dalai Lama of Tibet. Chinese leadership does not view these changes as arrogant or detrimental, but rather as a national pride of sorts. They believe China is just refusing to give in to the more longstanding economies and stand up as a world powerhouse, which could prove to be problematic for US/Chinese relations.

AIG to sell Alico unit to MetLife for $15.5 billion

AIG announced on it would sell its American Life Insurance CO. division for $15.5 billion dollars to MetLife Inc. This transfer would assist AIG in repaying the government for the bailout dollars they received. AIG has been selling assest like this for the last year and a half to repay its debt. This deal alone helped increase AIG's shares from $1.02 to $29.10.

U.S. Retail Sales Rose in February

Retail sales increased 0.3% in the month of February, in contrast to the negative 0.2% which was predicted. Excluding gas and car sales, the increase was 0.9%. Consumers are getting more confident as employment declines slower, wages are more steady and hours worked are more constant. Electronics increased by 3.7%, clothing increased by 0.6%,building materials grew by 0.5%, and bars and restaurants increased sales by 0.9%. Car sales fell by 2% and Toyota sales fell by 9%. However it is expected that economic growth will slow in the coming months.

Hard times and education

This article shows an interesting point about the continually changing dynamics in our economy. As the recession hits, trade schools see more enrollees as they feel a degree will get them a better job. However, some argue that these institutions can't deliver what they promise. Also, these trade schools collect a lot of Peel grant and other grant money from the government, and perhaps this money could be better used where it is most needed. This is evidence of another potential adverse selection and moral hazard problem.

Dodd Set for Finance Reform Bill Push

This article is about how congress now is seeking to put regulation on financial institutions. The draft legislation is seeking to push through reform that would be bi-partisan but there are clearly road blocks to Mr Dodd's aspirations to get the legislation signed within the next few weeks.

Ultimately the bill is seeking to regulate the over -the counter derivatives as well as to seek a way to combat the notion of too big to fail to allow institutions to wind down in an orderly fashion. Lastly it will also seek to protect consumers and additional regulations with regards to loans.

Kazakhstan Shakes Up Government to Boost Economy

Kazakhstan used to be one of the few former Soviet Union states whose economy has been better off after the collapse. Rich in oil, natural gas and other energy sources, it has almost outperformed all other former Soviet bloc states who have all been moving towards market economy. Until last year...

Because Kazakhstan's economy has been relying solely on its energy and mineral exports, it got hit hard when demand for its resources fell dramatically due to the financial crisis. And the article discusses the effects it has had on the domestic policies in Kazakhstan.

Chinese Currency Overvalued?

This article is about Premier Wen Jiabao's outrage at pressures from developed nations, most specifically the United States, to appreciate their currency. Mr. Wen held a press conference to share his anger. Mr. Wen said that it was unreasonable for the United States to expect China to appreciate their currency in order to increase the United States' exports. Furthermore, he was concerned at the falling rate of the United States currency since China holds so many American dollars in reserve. The Chinese currency has been pegged to the dollar since 2008. Mr. Wen referred to policies attempting to depreciate one currency while increasing another countries as an attempt to increase exports as trade protectionism. The press conference marks growing tensions between the United States and China over economic policies.

The article also discusses China becoming more attractive to foreign investors and their absence at the Copenhagen meeting on climate change last year.

Obama Calls for Sweeping Overhaul in Education Law

The Obama administration has called for a law proposing to reshape the structure that teachers teach to test, made the curriculm smaller and also labeled one in three American schools as failing. This plan is to affect almost 100,000 public schools. The admin would replace the schools pass/fail system with things that would reflect an individual students growth such as attendance, graduation rates and learning, not just test scores. The admin also proposed that all students should go through high school and on to college and this goal is expected to be met by 2020. Also mentioned in the article was that schools that were performing well would receive rewards and schools that weren't would be intervened by the state and be assisted in how to perform better. There would be teacher evaluations on how effective an instructor is in teaching and instructors would not just be given preference because of their credentials. The administration has added $100 million to the 20110 budget for schools to offer a broader variety of courses/

Obama Focuses on 3 to Fill Fed Board

Economists Janet L. Yellen (president of the Federal Reserve Bank of San Francisco) and Peter A. Diamond (professor at MIT and an authority on Social Security), along with lawyer Sarah Broom Raskin (also commissioner of financial regulation) are contenders for three spots on the board of governors. Janet Yellen is a top contender and is top choice for Vice Chairwoman. A former Fed governor, Randal S. Kroszner stated “What they’ve done is try to put together a package of people who play to different strengths: analytic economics with Yellen; a broader economic perspective with Diamond; and then, clearly, a focus on consumer protection with Raskin.” It is projected that in the next two months the Fed will tighten the monetary policy. Also, last week vice chairman Kohn, announced that he will be retiring.