The Toyota Way is Shutting Cali's Last Auto Plant

♠ Posted by Emmanuel in at 8/28/2009 10:07:00 AM
A few days ago, I described America as an amalgamation of Calibankruptcy and Government Motors: insolvent state governments and businesses leeching the life out of a once-healthy entity with little hope of recovery. As it so happens, we have perhaps another notable entry in this line of argument. One of the semi-successes in GM's recent sorry history was its plant in California run jointly with Toyota--a company that actually knows a thing or two about profitably running a car business. This entity is (was) known as the New United Motor Manufacturing, Inc. (NUMMI). With GM entering bankruptcy, it pulled out of its end of the...
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Turner 'n' Hooch: FSA Boss Talks Tobin Tax

♠ Posted by Emmanuel in at 8/27/2009 08:10:00 AM
Ah, here we go again with an old chestnut. It's said that there are few truly new ideas, but many that are recycled time and again. The Tobin Tax, named after a proposal of Nobel Prize in Economics winner James Tobin to tax international currency trading, has come and gone in our collective consciousness. Tobin envisioned it as a way of generating socially beneficial revenue and, by contrast, limiting trading which generated socially dubious results including destabilizing currency movements. Activists have long championed the cause of a Tobin tax for understandable reasons, though its uptake has been nil as it would require...
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How to Create World-Class Universities: A Guide

♠ Posted by Emmanuel in , at 8/26/2009 06:05:00 AM
This is a bit of navel-gazing at the international political economy of what a lot of us are familiar with in higher education. Given the famously open-ended nature of higher education, our American friends have depicted college as consisting of sex for the undergraduates, parking for the faculty, and football for the alumni. While I am not in a place to doubt the veracity of this assertion, one of the things that interests me at the current time is the challenge for the rest of us in establishing world-class universities. Is it a worthwhile goal or is it one just for wealthy nations? To me, higher education in its current...
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US Deficit Projections: Is the CBO on Drugs?

♠ Posted by Emmanuel in at 8/25/2009 04:13:00 PM
There is an interesting political economy of budget projections alive and well at the heart of American politics. In days gone by, it was more or less the sole responsibility of the executive to prepare budget forecasts. Hence, the Office of Management Budget (OMB) was tasked with preparing forecasts under White House's auspices. However, congressmen in the early Seventies gradually became wary of a steady diet of White House numbers that were--how do I put this--massaged and frequently underestimated federal budget shortfalls. Hence, the Congressional Budget Office (CBO) came into existence in 1975. The OMB was tasked with giving a less partial budget picture in second-guessing the OMB.It was thus no surprise when, early in 2009, the CBO came out with a far larger ten-year deficit forecast ($9.3 trillion) than the OMB ($7 trillion) during the February/March period when the 2010 budget was being debated. However, imagine my surprise today after finding out that the revised 2010-2019...
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The "Mu$eum of American Finance"? Yes, It's Real

♠ Posted by Emmanuel in , at 8/23/2009 09:59:00 AM
A few weeks ago, I visited the Bank of England Museum. While it was certainly an informative enough trip, it certainly lacked any information on the BoE's massive attempts to resuscitate the British economy via unprecedented "quantitative easing" (code words for currency debasement for those like yours truly.) Monetary policy is of interest to a limited audience.It was thus with great interest that I read about the Mu$eum of American Finance (their spelling, not mine--see the image above) in the pages of today's New York Times. As with many other institutions reliant on the support of wealthy benefactors, it is facing a challenge...
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The "Humanizing" of China x3

♠ Posted by Emmanuel in , at 8/21/2009 09:39:00 AM
Like America's vaunted currency bashers, the West sometimes views China as a distant other unaccountable to, well, Western codes of conduct. Supposedly, this holds true for any number of things--the environment, human rights, and commercial conduct. We have all read about China's general nonchalance about the environment, its arbitrary detention of multinational employees, and its blase attitude towards property rights.Or are these really so? The Financial Times offers a cornucopia of stories that suggest China is not as unaccountable as it is often made out to be. First, we have a tale of apparatchiks closing down a third plant in a month due to environmental concerns, this time due to the lead poisoning of many young'uns:China has closed a manganese smelter after more than 1,300 children living near it were found to suffer from lead poisoning, state media said on Thursday. The scandal marks the third public case of metal contamination in less than a month. It comes at a time...
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Faulty Predictions of Falling Philippine Remittances

♠ Posted by Emmanuel in , at 8/20/2009 03:06:00 AM
Many are predicting that remittances to less-developed countries will fall in 2009 for the first time since 1987. This phenomenon is attributed to the decline in employment opportunities abroad as destination countries have undergone economic slowdown. Worker's remittances are, of course, a significant part of external funding for many LDCs, having long outstripped official development aid as a source of foreign exchange. For several countries, remittances also exceed foreign direct investment. With predicted falls in remittances, it is possible that some LDCs may suffer adverse balance of payments consequences.The Philippines is often identified as a country of emigration, sending well over a million persons overseas to work annually. Moreover, it is the fourth largest recipient of remittances after China, India, and Mexico. It is no exaggeration to say that these inflows have become a foundation of the local economy in terms of generating consumer spending and guarding against...
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What If a Formula One Guy Ran the United Nations?

♠ Posted by Emmanuel in , at 8/17/2009 05:25:00 AM
It's interesting times in Formula One, supposedly the world's most watched sport--bar football (soccer) perhaps. Aside from Honda leaving the sport for cost reasons at the end of last year, BMW is set to do the same after this year. There's also been this mini-drama about seven-time world champion Michael Schumacher rejoining to fill in for injured Ferrari driver Felipe Massa, though this possibility was ruled out after Schumacher concluded that existing neck injuries made him unfit for subbing. The interesting political angle is that longtime Federation International de l'Automobile (FIA) President Max Mosley is scheduled...
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The Heart of the Matter on Stimulus

♠ Posted by Emmanuel in at 8/17/2009 02:37:00 AM
I got the call today, I didn't wanna hear...but I knew that it would comeAnd so I find myself in familiar territory of having to comment on stimulus, particularly the non-stimulating American variety due to various press reports about it that make very little sense for reasons that will become very clear. Let us begin our journey to get it over with as soon as possible.That four commentators on various ends of the respectability spectrum misunderstand the matter of recession spending is indicative of the fog that surrounds the stimulus debate. While I cannot claim to be the last word on the matter, rest assured that I can tell when others make basic factual errors. Let us first dispose of that poster boy for economic sensationalism, Ambrose Evans-Pritchard, recently dubbed by this blog as the world's worst financial reporter due to his proud lack of basic understanding of finance and serial tabloidal tendencies:Crass Keynesianism has done its job. A blast of fiscal stimulus and...
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Ambrose Evans-Pritchard, Worst Financial Reporter

♠ Posted by Emmanuel in at 8/15/2009 01:59:00 PM
You have to be pretty bad to outdo the CNBC flunkies who pollute cable TV with their endless hype about the US stock market and America in general when the truth is that neither have exhibited any progress in about a decade. However, there is worse. I began to wonder about who exactly Ambrose Evans-Pritchard was after his endless sensationalist features as international business editor of the Daily Telegraph. As a financial reporter, I was even more astounded to read him proudly confess that he was a "technical dolt" while stating that he did not know why a high put to call ratio could be a contrary indicator. (In typical...
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Calibankruptcy is Enfeebling Its University System

♠ Posted by Emmanuel in at 8/14/2009 10:36:00 AM
Think of the US 'economy' as a marriage of Calibankruptcy and Government Motors blown up to national scale: it is a combination of hemorrhaging public finances partly stemming from unlimited desire to prop up money losers like airlines, carmakers, and casino capitalists. You can believe that there will be collateral damage from this exercise in self-destruction. While the abovementioned episodes have received tons and tons of coverage, there is a recent article that I bookmarked from the LA Times that oddly received basically none since my del.icio.us social bookmarking account indicates no one else has bookmarked it. Most...
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DPJ Japan's Retro Style on Market Fundamentalism

♠ Posted by Emmanuel in at 8/13/2009 09:42:00 AM
The question of how to reinvent Japan, Inc. is one that has puzzled the world ever since the turn of the Nineties. How can this once-dynamic country be rescued from its moribundity?Despite all it trials and tribulations, leadership changes in Japan have been largely conservative. That is, perhaps, until now. There's interesting commentary from Democratic Party of Japan (DPJ) leadership. The party, of course,is widely expected to defeat the perennial Japanese incumbents, the inaptly named Liberal Democratic Party (LDP). Channeling Stiglitz-era Globalization and Its Discontents, he criticizes "market fundamentalism" for the...
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US Wins in WTO A/V Case vs. China as Expected

♠ Posted by Emmanuel in ,, at 8/12/2009 03:49:00 PM
It's like shooting fish in a barrel sometimes: Sometime ago, the US lodged complaints at the WTO over China's intellectual property regime--mostly dealing with minimum quantities vendors of pirated software need to have to be apprehended (DS362), and this one over limitations on the distribution of imported A/V materials--mostly music, movies, and books (DS363). The former case was something of a split decision, but this one is more unequivocally a US victory. Then again, when you are the primary author of the rules of international organization to date, you do expect comfy wins when you bring things up, eh?The US Trade Representative lauds this victory. Here is an excerpt although the entire blurb is worth reading if you want to know more:U.S. Trade Representative Ron Kirk welcomed the results of a World Trade Organization (WTO) dispute settlement panel report made public today. The report found that major Chinese restrictions on the importation and distribution of copyright-intensive...
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The Non-Aligned Movement As Living Fossil

♠ Posted by Emmanuel in , at 8/12/2009 03:31:00 AM
The story of the Coelacanth fish is not one that routinely comes to mind when discussing international organization, but it is nevertheless one worth recounting in the present context. As I would like to think that this blog provides a richer slice of life than your everyday economistic fare, let me explain what Coelacanth fish have to do with a long-dormant grouping of developing countries.The Coelacanth fish is said to represent the closest link between fish and the amphibian creatures that first waded their way onto land. Paleontologists believed that the fish, whose existence predated that of the dinosaurs, became extinct...
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Fond Reminisces About Enronitis and US Decline

♠ Posted by Emmanuel in ,, at 8/11/2009 01:51:00 PM
Have I got a treat for you today, dear friends. I was rummaging through my cabinet in search of something else when I came across this priceless piece of disaster memorabilia. As you can see, it is an Arthur Andersen binder for a seminar concerning--I kid you not--a "Business Ethics Program." There is an old saying about being able to tell who a person is by the persons he keeps company with. As an inveterate collector of oddball stuff--I like to think of this blog as postcards from a world gone wrong as its subtitle suggests--my conviction is that I can tell who a person is by the memorabilia s/he keeps.But wait, it gets...
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Fuzzy Math: PRC Says Rio Tinto Bilked It of $102B

♠ Posted by Emmanuel in , at 8/10/2009 03:54:00 AM
Things are going from bad to worse for Sino-Australian relations. Earlier on, I relayed my thoughts on the detention of Rio Tinto mining executives over spying charges. By coincidence [wink, wink], negotiations have stalled over the price Aussie miners will charge its official Chinese customers. The United States has not really forced this issue at Australia's behest lest China express wariness over holding over a trillion US dollars--most likely because it wants to stay in Beijing's good graces despite the evidently manufactured charges against the Rio employees. That is, the concern that China will detain American execs...
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