It takes one spark

2011-01-28 / Andy Xie Tusisian Mohamed Bouaziz, a 26-year-old with a university degree, set himself on fire on December 17 after police confiscated the fruits and vegetables he was selling without permit. One month late the Tunisian government has been toppled and the Egyptian government is on the ropes. Why and what is happening? What would be the impact on us? Inflation is the factor pushing people into taking the desperate act. The people who were barely surviving couldn't go on when food price is up 50%. There isn't a cushion in these economies for such a large price increase. There is a saying that demographics is destiny. After the World War II birth rate surged across the world. Two decades later, China had the Cultural Revolution, the US Woodstock, and France 1968 revolution. As...

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Posted in: Islamic World

Supporting euro

2011-01-24 / Andy Xie,  The New Century Weekly Summary ------------ China and Japan are supporting eurozone by purchasing government bonds that the market shuns today. Chin and Japan have $4 trillion in foreign exchange reserves and are capable of bridging liquidity problems that some eurozone economies are facing. What China and Japan can do is to stop market panic from leading some otherwise viable economies down a vicious spiral of rising interest rate, rising debt burden, and bankruptcy. The economies that are not viable in the first place shouldn't be helped. China and Japan's action helps themselves in two ways. First, euro is the only alternative to the dollar for global trade, commodity pricing, and storing foreign exchange reserves. If the euro falls apart, the...

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Posted in: China,EURO,Japan