Turning on the Lights in China – Part 1/2

July 19, 2011

Access to electricity is the key to developing a country into a modern state with the potential to grow a large, consumer driven middle class.

Poverty reduction is also linked to access to electricity.

In fact, to reduce poverty, China has introduced electricity access to over 900 million rural residents in over 50 years and has achieved an electricity access rate of as high as 98%. Source: Stanford.edu


August 15, 2010

In 1949 when the People’s Republic (PRC) was founded, there were only 33 small hydropower stations in rural China, with a total installed capacity of 3.63 megawatts, and total electricity consumption in rural areas was 20 million kilowatts. Today, there are thousands of hydropower stations, and the PRC has more than any country on the earth.

In 1979, China’s Xinhua state run news agency reported a serious electric power shortage. The agency said China produced about 150,000 million kilowatts of electricity a year and ranked about seventh among the world’s electric energy producers.

In fact, China’s output was about an eighth that of the US. Source: History of China’s electricity use


August 15, 2010

In the last post, China’s Goals to Go Green, we discovered that China now produces more electricity than the US.

To understand what China has accomplished since 1979 when it was ranked seventh among the world’s electricity producers instead of first, it helps to discover the time it took for America’s electrical grid to be built, which will be continued on June 20, 2011 in Turning on the Lights in China – Part 2

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

To subscribe to “iLook China”, look for the “Subscribe” button at the top of the screen in the menu bar, click on it then follow directions.

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Posted by Lloyd Lofthouse

The “BRICS” Emerging Powers Summit

June 22, 2011

On April 14, 2011, Chinese President Hu Jintao and leaders from Brazil, Russia, India and South Africa (countries now known as the BRICS) met on the far southern Chinese island-province of Hainan Island.

The most telling result of the summit was the decision to refuse mutual payments in US dollars. This means that the BRICS countries will give credits to one another in their national currencies and the development banks of these countries have signed an agreement about a further gradual withdrawal from loans in American dollars.

The move opened lines of credit in these countries national currencies in order to dilute their overreliance on the U.S. dollar as the BRICS seeks more independence from American political influence.

In addition, China and India agreed to reestablish defense ties and initiate closer border cooperation. China also agreed to deepen its “strategic partnership” with Russia. The biggest gains to come out of this summit may be the BRIC access to Africa due to its newest member, South Africa.

The BRICS nations now accounts for over 40% of the world’s population, but only 18% of its GDP in 2010 and the IMF says the BRIC nations will account for 21.6% of the world’s GDP by 2015, while the International Business Times reports that these nations are expected to represent 47% of the world’s GDP by 2030.


Aljazeera English says, “While many developed nations are struggling with the aftermath of the global recession, the economies led by the leaders of the BRICS nations are still booming.”

Another way to look at this is to compare the BRICS with the GDPs and labor force of the European Union and the United States.

We often hear that the United States has the largest GDP in the world, which was $14.72 trillion in 2010 with a labor force of 154.9 million as estimated by the CIA World Factbook.

The CIA World Factbook listed the European Union (probably due to the Euro) as the world’s largest economy at $14.89 trillion with a workforce of 225.2 million (2009 est.).

When we combine the GDPs and the labor force of the BRICS nations, we see a combined GDP of $21.079 trillion and a labor force of almost 1.5 billion people.  If the BRICS developed a standard currency as the European Union has done that would create the largest economy on the planet with largest work force.

The BRICS is also calling for a greater say on the UN Security Council, which only China and Russia have a permanent seat on now.

Goldman Sachs investment banker Jim O’Neill to highlight Brazil, China, Russia and India’s similarities in terms of their potential for development and growth, created the term BRIC. South Africa was not a member at the time.

To discover more about the BRIC/S see Move Over America, the BRIC is Coming, The Growing BRICs, Brazil’s Growth Depends on China and China Reaching out to South Africa

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

To subscribe to “iLook China”, look for the “Subscribe” button at the top of the screen in the menu bar, click on it then follow directions.

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Posted by Lloyd Lofthouse

Bobbleheads Still Predicting Bursting Bubbles in China

June 17, 2011

It wasn’t that long ago (May 17) that I wrote about a Chicken Little-Henny Penny predicting a real estate bubble bursting in China and wrecking its economy as it did in the US in 2008.

Then a friend recently sent me another link to another “sky is falling” piece.  This time, the “want-to-happen” bad news came from Jeff Cox, a staff writer for CNBC.

Cox wrote, “China’s economy is showing real signs of weakening, particularly in real estate, and even could tip into a recession, hedge fund manager Jim Chanos told CNBC.”

I’m surprised that Cox looked under a Hedge Fund rock to find a quote predicting a bad economic future for China.

Basically, Hedge Fund managers do two things: they use small amounts of money, or leverage, to promise large amounts of stocks or commodities. Secondly, they all say they will deliver this stock or commodity at a particular point in time. In that sense, hedge fund managers are trying to time the market, which some would say is very difficult if not impossible to do unless they manage to manipulate the market in some way or have a crystal ball.

Using other sources, we discover a few facts that tell us Cox should have left that quote under the Hedge Fund rock where he found it and called someone else.


Discover how many Chinese buy real estate.

First on May 5, Jason Simpkins writing for Seeking
Alpha says,  “Yes there are probably pockets of bubbles in China and in the real estate market, but against that backdrop you have 500 million people expected to move into Chinese cities by 2020. That means the number of people expected to move into cities is almost double the population of the United States,” said Money Morning Chief Investment Strategest Keith Fitz-Gerald. “So in the context of China’s explosive growth, what we’re looking at are some moderate setbacks over an extended period of high growth.”

Second, on May 9, James Kostohryz writing for Minyanville says, “China’s Housing Bubble: Mainly Hot Air… Studies by the World Bank, The Economist Intelligence Unit, and UBS have noted that average home prices in China as a whole have risen by roughly 6%-7% per annum in the past decade.

Third, China’s real estate investment accounts for roughly 11% of its GDP, and from Chris Oliver writing for Marketwatch on May 18, we discovered that “New home prices rose across leading Chinese cities in April, even as many key cities saw the pace of appreciation and sales volume cool, according to official data Wednesday.… Of 70 cities tracked in the survey, 56 reported gains in new home prices.”

“So, I think that it should be clear by now, that there is no generalized price or quantity bubble in the Chinese residential real estate market,” Kostohryz wrote, “Home prices have actually been getting substantially more affordable in China in the past decade relative to income levels.”

To learn more, I recommend reading what Simpkins, Kostohyrz and Oliver wrote on this topic. The links have been provided.

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

To subscribe to “iLook China”, look for the “Subscribe” button at the top of the screen in the menu bar, click on it then follow directions.

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Posted by Lloyd Lofthouse

Automation Nation

June 15, 2011

There are sound economic reasons why jobs are vanishing in the US.

Economically speaking, to remain competitive, manufacturing companies must reduce their overhead, and lower product cost to the consumer.

The problem with lost jobs in the US is the politics, which stirs up a storm of ignorance when the blame is put in the wrong place. Due to politics, when jobs in the US are farmed out to foreign workers, American workers scream bloody murder and blame China, India or Japan.

Then recently, I read a piece from the Daily Ticker “Made in America”: The Comeback that revealed (without meaning to) the real reason so many jobs have been lost and may never come back even if China, India and Japan vanished tomorrow.

The Daily Ticker said, “Since 1972, U.S. manufacturing output has risen nearly 2.5 times, according to Boston Consulting Group (BCG)…. However, U.S. manufacturing employment has fallen nearly 25% in the same period.”

If American manufacturing output has risen nearly 250% since the 1970s, and the population only increased by 50%, why has manufacturing employment fallen nearly 25%?

The answer is “automation”. If you want to learn more, watch the two embedded videos.

In addition, today 80% of the work force in the U.S. is employed in the service sector. This sector, like manufacturing, is threatened by not only cheap labor overseas but automation technology as well.

Even if the manufacturing sector were to increase in the United States, human labor would still be replaced by automation technology.

Soon, there will be only the wealthy and the machines that serve and pamper them. The rest of of us will be obsolete. What do you think will happen to the unemployed then?

Instead of getting angry at workers in other countries, shoot a machine. Then after cooling down, discover the reasons low and/or unskilled labor jobs have gone overseas or have been automated.

One of those reasons is the three kinds of illiteracy.

Low and/or unskilled jobs that do not require literacy are easy to move overseas where there are hundreds of millions living in severe poverty willing to work for much less than most workers in the US.

“The United States Department of Education estimates that functional illiteracy, incompetence in such basic functions as reading, writing, and mathematics, plagues 24 million Americans. Thirteen percent of American seventeen-year-olds are illiterate, according to a recent issue of Time; the estimate for minority youth is an astonishing forty percent.

Then there is cultural illiteracy — “To be culturally literate is to possess the basic information needed to thrive in the modern world.”

The third is moral illiteracy.  “In generations past, parents were more diligent in passing on their principles and values to their children and were assisted by churches and schools which emphasized religious and moral education. In recent years, in contrast, our society has become increasingly secular and the curriculum of the public schools has been denuded of almost all ethical content.” Source: Reformed.org

Discover The End of Cheap Labor from China

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

To subscribe to “iLook China”, look for the “Subscribe” button at the top of the screen in the menu bar, click on it then follow directions.

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Natural Gas, Biogas – Let’s all have Gas “Naturally!”

June 4, 2011

Recently, a friend sent me a link to news that warned of new US government regulations on hydraulic fracturing that could stop shale exploration.  If this happened, what the consumer would lose is access to the natural gas produced from shale. Source: Natural Gas for America

Earlier this week, the White House said the natural gas industry should support “common sense” regulation to ease public worry about potential water contamination from fracturing, a drilling practice vital to the U.S. shale gas boom.

In fact, according the Natural Gas.org, the US has about 100 years of supply (if developed) at current rates of consumption, while Reason.com reports that the IEA says world natural gas supplies could last more than 250 years.

While development of natural gas from shale may come to a stop in the US due to environmental concerns, China is looking at the production and resources of shale gas in the United States and is learning from America.

China’s technically recoverable resources of shale gas are estimated to be about 50 percent higher than those in the United States.

EIA.DOE.gov says, “The outlook for unconventional natural gas production is more positive in China than in OECD Europe first and foremost because China’s geology suggests a greater unconventional resource potential than in Europe. Further, although natural gas production from conventional resources in China, as in Europe, cannot keep up with domestic demand, China’s government strongly supports unconventional gas development, and public resistance is likely to be less of an impediment in China than in OECD Europe and the US.”

While developing natural gas resources in China, there is also Biogas development in rural China, which the two embedded videos talk about. China is taking advantage of waste to produce energy, which results in higher standards of living for those involved.

Imagine the biogas from 1.3 billion people and the animals raised to feed those people.

Discover The One Party Advantage, Water – Two Countries Tell a Tale, Volting China into the 21st Century or Greenpeace China

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Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too.

To subscribe to “iLook China”, look for the “Subscribe” button at the top of the screen in the menu bar, click on it then follow directions.

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Posted by Lloyd Lofthouse

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