經濟,財務,統計學,數理科學與政治評論

Dear American people:

  It is not a good time to talk about the re-emerging of emerging markets. We do see the falling of Brazil, Venezuela, Russia, Middle Asia nations, South Africa, North Africa and Middle East nations. Even Red China has its trouble. People do not expect the restructuring plan of Red China succeed. People do not expect other emerging markets re-emerging lately. People do not expect the US big corporations have great profit figures, especially those ones with lots connection with emerging markets. So we may go from here to nowhere.

  Maybe it is not a good time to encourage American people to reconnect their fortune with emerging markets. Maybe we do not see some great improvement of financial markets all around the world. Maybe it is time to hedge foreign exchange risk except the US dollar. After all those years, I still encourage American people not to worry about Red China too much. Life will find its way to survive, So will Red China. Even without the God's blessing, Red China will find its way out someday. Maybe not tomorrow, maybe not next year, maybe it may take a long time. But Red China will, someday.

  After QEs of both Red China and the US, we find that the US tries hard to reduce its government debt. However, we find that Red China wants to expand its influence all around the world further. Now the RMB has a larger share in the SDR, but the RMB still can't not be treated as free usable. That is the reason why Chinese corporations or Chinese people all convert their RMB to the US dollar lately. It shows the Fed system, backing the US dollar through the US government bond and interest payment, is more trustworthy by people from Red China than the RMB-issued system. People could use the US dollar to purchase oil, diamond and gold all around the world, but the RMB couldn't be used on those kind of things. Government shouldn't print money without any price paying. It is a steal from people.

  We do expect Red China will not collapse in the region of Chinese communist authority, but the economy of Red China will eventually slow down or even show its weakness from those overinvestments. Those infrastructures couldn't find enough users to pay for the construction cost. Those overinvestments already create a lot of corporate debts in terms of RMB in Red China. Sooner or later, we may see many restructuring processes going on for those corporate debts or many bankruptcies of those corporations. Their balance sheets couldn't be balanced in many years because people in Red China could not afford those ones with higher price. People in Red China may talk about the higher usage rate of traditional railway. But we all know the higher rate is due to the subsidy of government. The living standard of Red China is still too low. The technology level of Red China is still far from the western nations or Japan. Super-speedy railway needs a lot of customers who could afford the higher price of ticket to balance the book. It is the reason why people do not expect the success of Red China revolution this time. Red China authority seems to forget the privatization is the only way to promote the modernization of Red China. Market mechanism is the only hope for Red China to get its progress. Market mechanism is the only way to help the society getting away from wasteful overinvesting. Many super-speedy railroads rebuilt in Red China may have to be abolished someday if those ones could not generate enough revenue. The Red China authority doesn't have the ability to move this country with 5,000 years history to a new level but leaves a lot of unresolved debts to the nation lately.

  Of course, we may not see the collapse of Red China. We do realize the unemployment rate is what concerns. But we do see an even larger wealth discrepancy between the wealthy and the poor in Red China compared with the US or other developed countries. It is a price to pay when Red China still think the socialism is good for the country, but it is not actually. Red China should use privatization as the way to modernize its own nation. Let the market price plays its role to resolve the allocation issue of resource. It is the only way to let Red China find a way out of its trouble. 

  Dear American people, we do see the Fed and the Obama administration do a good job to reduce US government debt. It is a good sign even though the US may still need more than a decade to obtain the goal. But we do see American people try hard to help its own nation. Move on without turning back. Move on without pulling yourself back to those horrible things. Remember the victory belongs to the last man stands still between Red China and the US. I bet the US prevails because it has a free market mechanism. 

  Also, we expect US corporations may find their ways to reconnect with emerging markets on their own benefits. Everything is with a price. If those connections couldn't bring profits, who will do those kind of things?

  On inflation issue, people do expect higher inflation rate coming in the near future. With falling oil price and volatile financial markets, people expect a mediocre inflation rate in the US lately. But the inflation rate will go much higher in the US this year because of a larger flowing back of greenback to the States. Remeber, inflation is always and everywhere a monetary phenonmenon. It does happen all the time. People do not expect higher inflation rate in the US because of larger US dollars outflow before.

  May God bless...