The Economic Health of BRICS – Part 2/7

January 12, 2012

China’s banking system has undergone significant changes in the last two decades and is functioning more like western banks than before but remains owned by China’s government.

That is a significant difference. For example, in America, there are no government owned banks but the public sector insures any risk taking the private sector banks take.  This means that private sector banks may lose trillions and the government will step in, as Washington D.C. did in 2008, and go deep into debt to save the banks from drowning and taking America and the West’s economies down with them into a black hole.

The biggest difference between the west and China is the money trail.

In America and the west, most people borrow from private banks to buy private property and when the value of the property drops, as it has in the United States, and the borrowers walk away letting the bank reposes a property that is worth much less than the loan amount, much of the money is gone—when the house sold, the equity went to the previous owner and any mortgage that existed was paid off. The US government made no money on the deal (property tax goes to state governments).

It doesn’t work that way in China because the banks are owned (and controlled) by the central government and so is the land. A better idea of the difference between buying private property in the west and government owned property in China comes from Global Property Guide.com that says, “The slowdown (drop in property values in China) follows market-cooling measures first introduced in April 2010. The campaign intensified in 2011. The down payment for first-time buyers’ mortgages was increased to 30% from 20%, and for second homes rose to 60% from 50%.”

By comparison, in America, down payments may be as low as no money down or 3.5% and as high as 20% depending on the loan and the qualifications of the buyer/s.

Continued on January 13, 2012 in The Economic Health of BRICS – Part 3 or Return to Part 1

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Lloyd Lofthouse is the award-winning author of The Concubine Saga. When you love a Chinese woman, you marry her family and culture too. This is the love story Sir Robert Hart did not want the world to discover.

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The Economic Health of BRICS – Part 1/7

January 11, 2012

In 2001, Jim O’Neill, the chief economist for Goldman Sachs, coined the BRIC acronym to represent the combined economies of Brazil, Russia, India and China. He was also so bold as to predict that by 2032, or sooner, the BRIC would overtake the six largest western economies (which includes America) in terms of economic might.

Then in 2010, South Africa joined the BRIC turning that acronym into the BRICS.

In fact, the International Monetary Fund (IMF) has predicted that China, a member of BRICS, will beat the United States as the world’s largest economy by 2016 with a GDP of $19 trillion compared to $18.8 trillion for the US.

There are about seven billion people on the planet and almost half live in Brazil, Russia, India, China, and South Africa. The US, by comparison [I prefer factual comparisons over opinions], holds less than 5% of the world’s population. However, I thought I’d throw in this comparison as a footnote. The King’s College of London reported that in 2009, “More than 9.8 million people are held in penal institutions throughout the world… About 2.3 million were in the US,” which means 23% of the total global prison population was in America.


About prison slavery in the United States.

Did you pay attention?  A country [the US] with less than 5% of the global population has 23% of the  global prison population.

By comparison, the five BRICS countries [without the freedom American citizens seem to enjoy] has almost half of the world’s population but only 35% of the global prison population.

What does that tell us—that the more freedom and wealth a country has, the more crooks it grows and attracts?

Anyway, the world’s combined GDP, according to The World Bank was more than $63 trillion (US) in 2010. The GDP of the US was $14.6 trillion, while the BRICS’ combined GDP equaled about $11.6 trillion (US).

Recent drops of property values in China, sometimes reaching 50%, caused dire predictions in the Western media that China’s economy would soon crash and take the BRICS down with it causing their economies to suffer as well.

However, it is best to understand China’s economy and banking system to see if this wishful thinking on the part of China’s Western critics is valid.

Continued on January 12, 2012 in The Economic Health of BRICS – Part 2

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Lloyd Lofthouse is the award-winning author of The Concubine Saga. When you love a Chinese woman, you marry her family and culture too. This is the love story Sir Robert Hart did not want the world to discover.

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America’s Lost Work Ethic and the End of its global Exceptionalism – Part 5/5

December 13, 2011

The educational system and labor market in China are based on merit, while in the United States, the emphasis is on self-esteem and feeling good about oneself.  In America, merit is not important and the happiness of the individual is.

In China, those that work harder and do a better job, regardless of self-esteem or happiness, tend to prosper. in fact, Asian-Americans have the lowest self esteem in the United States.

Gallup studied China’s work ethics. Not surprisingly, the credo “work hard and get rich” is by far the most popular choice, selected by 53% of respondents. About one in four Chinese (26%) opt for “don’t think about money or fame, just lead a life that suits your own tastes,” while less than a tenth of Chinese identify with all the other responses. Perhaps most telling: Only 2% of Chinese choose the collectivist exhortation to “never think of yourself, give everything in service to society.”

In short, it would appear that the country’s commitment to material self-betterment through hard work is firmly rooted and unchallenged.

However, in the United States, a Yahoo.com, ABC News Piece said, “Between 1979 – 2007, the income of the top 1% of Americans increased by 275%. For the other 99% of the population, income only increased 29%.”

The problem is that when prices of everyday items such as food goes up due to inflation, many people cannot afford to buy them. In addition, equity in homes, where most of middle class wealth is, lost value.


Chinese Education: Social Life and Work Ethic

  Studies also show that countries that have a large income gap such as the US, also have high numbers of unemployed, incarceration, teen pregnancy, poor health and lower life expectancy. It may not surprise you that Chinese-Americans [including all Asian-Americans] have the lowest teen pregnancy rate too.

In fact, prison inmates by race breaks down to about: African-American 39.4%, White 33%, Latino-Hispanic 20.6%,  and Asian-American 1.7%.

That’s right. For Asians it was one “point” seven percent [1.7%] and Asian-Americans graduate from high school and college in the highest ratios.

In addition, the King’s College of London’s World Prison Population List reports, “The United States has the highest prison population rate in the world,” while China doesn’t even make the top sixteen list.

The US has about 2.3 million people behind bars at 756 per 100,000 people, and China has 1.56 million at 119 per 100,000.

Since the lack of an education often lands Americans in prison, low paying jobs or unemployed, one would think that working hard to earn an education would be popular in the US, but it isn’t. Instead, in the US, it is the old blame game. “It’s the teacher’s fault I earned a failing grade or the class was boring.”

It does not matter if the child does not do homework, study for tests or hates to read [because it gets in the way of video games, Facebook or TV], it’s still the teacher’s fault. However, in China, it is seldom the teacher’s fault and parents often take all or most of the blame for a child’s failure in school.

The Wall Street Journal in From College Major to Career says, “Choosing the right college major can make a big difference in students’ career prospects, in terms of employment and pay… Some popular majors, such as nursing and finance, do particularly well, with unemployment under 5% and high salaries during the course of their careers.”

In addition, the attitude of America’s Baby Boomers is not much better than the children they raised that are now having trouble finding jobs because they did not take earning an education seriously as most Asian-Americans do.

The next question should be, “How long will the United States hold onto global super-power status with attitudes such as these?”

Return to America’s Lost Work Ethic and the End of its global Exceptionalism – Part 4 or start with Part 1

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Lloyd Lofthouse is the award-winning author of The Concubine Saga. When you love a Chinese woman, you marry her family and culture too. This is the love story Sir Robert Hart did not want the world to discover.

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America’s Lost Work Ethic and the End of its global Exceptionalism – Part 4/5

December 12, 2011

“What are these jobs that Americans will not do?” Slate.com asked. “Do they exist or are they a figment of the business community’s imagination? It turns out that their claims are largely true—there are plenty of jobs Americans avoid.


Manufacturers Looking for Skilled Workers

Let’s take a tour of them.

“Americans shun pretty much any unskilled labor that requires them to get their hands dirty: landscaping, entry-level construction, picking fruits and vegetables (Reuters reports that “up to 70 percent of U.S. farm workers are estimated to be undocumented, totaling about 500,000 people”), cleaning hotel rooms, busing tables, and prep cooking in urban restaurants,” and “American workers appear to be less interested in some kinds of factory jobs.”

In addition, “Americans, it seems, are also less willing to take stressful jobs that require lots of training and long hours, and that require them to work in unpleasant environments…”

For example, “The American Hospital Association says there are 118,000 nursing vacancies in the United States.”

In fact, the Washington Business Journal reported October 2011, “U.S. manufacturing companies have as many as 600,000 jobs that they cannot find workers with the proper skills to fill, according to a survey by Deloitte and the Manufacturing Institute.”


What the American Self-Esteem Boosting Parenting Movement did to the US – Did your child have fun today by skipping homework and avoid reading a book?

The survey found 5 percent of current manufacturing jobs are unfilled due to lack of qualified candidates, 67 percent of manufacturers have a moderate to severe shortage of qualified workers, and 56 percent expect the shortage to increase in the next three to five years.

What about China? Do the Chinese have a similar attitude?

Continued on December 13, 2011 in America’s Lost Work Ethic and the End of its global Exceptionalism – Part 5 or return to Part 3

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Lloyd Lofthouse is the award-winning author of The Concubine Saga. When you love a Chinese woman, you marry her family and culture too. This is the love story Sir Robert Hart did not want the world to discover.

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America’s Lost Work Ethic and the End of its global Exceptionalism – Part 3/5

December 11, 2011

DailyKos.com says, “American’s won’t work 12 hour days , $5 an hour for seven days a week.”

However, many Chinese will and they will work more than one job while saving between 30 to 50 percent of what they earn while sacrificing sleep.

However, in 1973 after graduating from college on the GI Bill (working nights and weekends), my first job was working 12 or more hours a day sometimes six and seven days a week on a salary without overtime.

Change.org says, “Despite high unemployment, Americans won’t work as farmhands. Have you ever read John Steinbeck’s Of Mice and Men, which is about two caucasion drifters working as farmhands moving from farm to farm to survive? at 112 pages, it is a small book and I recommend it.

The Center for Immigration Statistics tells us what the jobs are that educated Americans won’t work at. CIS says, “Of the 465 civilian occupations, only four are majority immigrant. These four occupations account for less than 1 percent of the total U.S. workforce. Moreover, native-born Americans comprise 47 percent of workers in these occupations.

“These high-immigrant occupations are primarily, but not exclusively, lower-wage jobs that require relatively little formal education.

“In high-immigrant occupations, 57 percent of natives have no more than a high school education. In occupations that are less than 20 percent immigrant, 35 percent of natives have no more than a high school education. And in occupations that are less than 10 percent immigrant, only 26 percent of natives have no more than a high school education.”

With no choice, American born citizens will work jobs most educated Americans refuse to do.

In fact, in October 2011, the New York Times reported about a Colorado farmer that decided to hire locally unemployed Americans instead of immigrant labor.  It took the farmer six hours to learn he had made a mistake.  At lunchtime, the first wave of local workers quit and never came back. Some of the workers said the work was too hard.

Since Chinese value education and work harder than most to earn one, they tend to stay in school longer.  In fact, Asian-Americans  had the lowest unemployment rate of all ethnicities. In 2010, 12.5% of Hispanic or Latino, 10% of African-Americans , 8.7% of Whites but only 7.5% of Asian-Americans were unemployed.

Continued on December 12, 2011 in America’s Lost Work Ethic and the End of its global Exceptionalism – Part 4 or return to Part 2

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Lloyd Lofthouse is the award-winning author of The Concubine Saga. When you love a Chinese woman, you marry her family and culture too. This is the love story Sir Robert Hart did not want the world to discover.

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