Before mid 2007 almost all political pundits had declared Hillary Rodham Clinton and Rudy Giuliani the nominees of the two major parties for the president of United states for Nov 2008 elections. Political rookie Barack Obama didn't stand any chance against the clinton machine and John McCain's political future was already dead. By this date, the same pundits have already authored books and talked thousand hours on-air , on how John McCain revived his campaign and how Barack Obama actually manage to beat the clinton machine and eventually became the 44th US president.
Who are these experts, anyway ? Some have spend their whole adult life in politics and may have predicted couple incidents correctly, and those couple incidents are enough proof of their expertise. These guys are similar to weather forecasters, they are not held responsible for going awry. These are the jobs where people make money either way, being right or wrong. There are many group of people who can be kept in the same column. In these days how can I miss a certain group: “Economists”.
Economists, during summer of 08, were describing how serious the recession was going to be and now they are drawing comparison with the great depression. How will this economic mess effect USA and the rest of the world in long term ? How long will this crunch last ? They are competing with each other to provide us the most articulate answer. Half of them seem to believe in the stimulus package and other half think it will severe the problem. Both of them sound equally right and equally confusing to general public, is their any science behind their claim or they are just supporting their parties ? And should we believe these guys ? because majority of them never had a hint of this crash until it happened. When Hank Paulson came up with 700 billion bailout package last year when one after the other bank tanked, nobody knew why its exactly 700 billion ? They just supposed they need a big number for rescue and came up with a supposedly big number. Inept people like me consider economics as a branch of science even though we don't understand it but what do these experts think ?
If these economists swap their job with weather guys or with political pundits will the outcome be any different ? I doubt it.
Showing posts with label Economy. Show all posts
Showing posts with label Economy. Show all posts
Wednesday, February 25, 2009
Thursday, January 15, 2009
Globalization is both way traffic
Recently a friend of mine shared a story on his encounter with a local old lady. The story like goes this.When my friend introduced himself as a foreigner, her response was “Oh you are not one of those guys, who earns dollars here and send it back to your country right? Because that really pisses me off. Thats why our economy is in tank” . It certainly wasn't particularly a nice way to talk to strangers. After hearing this story I went into contemplation which forced me to write this blog.
In summary the lady was blaming globalization for America's current hardship. People do have short memories and it seems it gets shorter in time of crisis. In the 90's American consumers and businesses regarded globalization and free trade as net positives when integration of China and former soviet bloc into the trading system lowered inflation, opened new markets and brought billions of workers into the labor force. Globalization was good when US got all the upside of it. May people then considered globalization as one way traffic, where they thought they were the only ones who where going to be the beneficiaries. Now probably America is getting some downside of it. You got to consider globalization as two way traffic, where you will gain some and lose some. It can be net positive or net negative all depending upon how you manage your trade policies, regulate your companies and how often do you find a way to distribute gains from the markets that are benefiting. [ I hope I won't be called communist for saying this]. I believe globalization is net plus for USA.
Yes, its true that jobs have been moved en masse recently to developing world, whether its IT jobs or Auto jobs but don't forget globalization has also created lots of jobs in U.S. for engineers, nurses, professors, computer programmers, accountants, bankers etc etc. People now shout loud about outsourced software jobs to India and China but forgot they already made billions by selling computers to those countries. Do you really want to sell them millions of personal computers but hope they remain ignorant ?
As I mentioned earlier globalization has both pros and cons and they are applicable to both small and big players of global economy. Its not that developing countries are always benefiting. For example, in India's PC market HCL (India's own leading company) is the big loser. The company introduced notebooks three years back but is not being able to compete with the American giants Lenovo, Dell and HP. Currently the U.S. economy crisis has shaken the whole world. Globalization enabled the U.S. to infect the rest of the world with its toxic mortgages.
The global economy is still the similar game but has welcomed lot many influential players. U.S. is still the most powerful player but can no longer determine the direction of global economy singlehandedly. The competition is tougher than before and will grow more fierce with the inclusion of stronger and ever improving opponents. U.S.A too will have to keep improving to win this game and I believe they will win gold if they can maintain their innovative edge against all its competitors.
In summary the lady was blaming globalization for America's current hardship. People do have short memories and it seems it gets shorter in time of crisis. In the 90's American consumers and businesses regarded globalization and free trade as net positives when integration of China and former soviet bloc into the trading system lowered inflation, opened new markets and brought billions of workers into the labor force. Globalization was good when US got all the upside of it. May people then considered globalization as one way traffic, where they thought they were the only ones who where going to be the beneficiaries. Now probably America is getting some downside of it. You got to consider globalization as two way traffic, where you will gain some and lose some. It can be net positive or net negative all depending upon how you manage your trade policies, regulate your companies and how often do you find a way to distribute gains from the markets that are benefiting. [ I hope I won't be called communist for saying this]. I believe globalization is net plus for USA.
Yes, its true that jobs have been moved en masse recently to developing world, whether its IT jobs or Auto jobs but don't forget globalization has also created lots of jobs in U.S. for engineers, nurses, professors, computer programmers, accountants, bankers etc etc. People now shout loud about outsourced software jobs to India and China but forgot they already made billions by selling computers to those countries. Do you really want to sell them millions of personal computers but hope they remain ignorant ?
As I mentioned earlier globalization has both pros and cons and they are applicable to both small and big players of global economy. Its not that developing countries are always benefiting. For example, in India's PC market HCL (India's own leading company) is the big loser. The company introduced notebooks three years back but is not being able to compete with the American giants Lenovo, Dell and HP. Currently the U.S. economy crisis has shaken the whole world. Globalization enabled the U.S. to infect the rest of the world with its toxic mortgages.
The global economy is still the similar game but has welcomed lot many influential players. U.S. is still the most powerful player but can no longer determine the direction of global economy singlehandedly. The competition is tougher than before and will grow more fierce with the inclusion of stronger and ever improving opponents. U.S.A too will have to keep improving to win this game and I believe they will win gold if they can maintain their innovative edge against all its competitors.