March 28, 2008
It All Comes Back to Mugabe
Market-Racket started with an entry about the leader of Zimbabwe. Today, almost three years later, there is yet another episode evolving in the drama of Mugabe's quest to stay in office.
Posted by Michelle Smith at 11:41 AM | Comments (0)
June 30, 2007
Friedman Was Right About China
Shortly before he died, the great free-market economist Milton Friedman was asked about his thoughts on China.
Is China's massive growth a sign that its Leninist way is successful? Can an authoritarian free market really work as well as a democratic one?
Friedman's response was blunt. "Political freedom will ultimately break out of its shackles. Tiananmen Square was only the first episode. It is headed for a series of Tiananmen Squares. It cannot continue to develop privately and at the same time maintain its authoritarian character politically. It is headed for a clash. Sooner or later, one or the other will give."
It may just be that something gave today.
Posted by Michelle Smith at 12:27 AM | Comments (0)
February 10, 2007
Burgernomics
The Economist has released its 2007 Big Mac Index this month. The metric, based solely on the famed Big Mac, has become one of the best known foreign exchange rate forecasters in the world. See what the two all-beef patties predict for this year...
Posted by Michelle Smith at 04:31 PM | Comments (0)
January 01, 2007
China Too Hot, Can't Put Out Flames
The words "overheated", "sizzling" and “red hot” have been used so many times recently to describe China's economy that you would think economists have developed a peculiar new penchant for TV cooking shows. These harsh warnings about future economic gloom in the country of 9% growth rates started as whispers in academic journals, were then pushed to newsprint by the media and are now being bellowed by politicians in the form of global conference agendas and altered foreign policies.
For a while Chinese authorities played deaf, relying on the unprecedented wealth pouring into their country as the decidedly universal solution to all future problems. Now, awakened by the realization that the gluttonous inflow could not only have an end but a devastating backwash of recession and job loss, they're starting to sweat.
Posted by Michelle Smith at 07:26 PM | Comments (0)
May 10, 2006
Gas Gouges
Are gas prices stressing you out? Do you find your eyes glued more to the fuel gauge than the road while driving? Are you losing friends because you no longer think it's worth the $3.25 to go across town to see them?
If so, you may be part of the camp of Americans who have had enough of these darned price hikes at the pump. You may even be one gray hair away from going out and doing something about it. Like maybe joining those price gouging protesters. Never before have you been a political activist, but hearing all the media talk about how the Shell Oils of the world are taking advantage of consumers and reaping all those profits may just bring you to your feet...
But before you go hike the mile to buy your poster board and "Down with Exxon" buttons, make sure you think through the consequences. Depending on how you look at it, price gouging might not be so bad.
Posted by Michelle Smith at 06:23 AM | Comments (0)
March 14, 2006
Fears of the Polish Plumber
Before the EU expanded to 10 more countries in May of 2004, a big obstacle to negotiations for enlargement was foreign labor. Nobody in the West wanted the new Eastern kids on the block raiding their countries and taking away jobs from the locals. This hurdle was so great that the only way to not have the parties walk away from the table was to compromise and give the veterans 7 full years to transition to an open-door policy.
But, surprisingly, despite all the fuss over not letting foreign labor in until the last possible moment, it looks like the Westerners are starting to jump the gun. This week, three EU nations, Spain, Portugal and Finland, reduced restrictions on foreign labor – early by 5 years. Was this a gesture of fraternization for the new members of the European club? Or could it be that the Westerners are anticipating to one day need a cup of sugar from their new neighbors?
Posted by Michelle Smith at 09:45 PM | Comments (0)
February 27, 2006
What To Do When You've Got Gas
Bolivia’s gas industry is about to head down a rocky path. Riding on the coat tails of a socialization trend that is sweeping over Latin America, Bolivian president Evo Morales is taking the gas companies from foreigners and placing them under the government’s control. Although a small player in other industries, Bolivia possesses the second largest source of gas reserves in Latin America, and fuels much of the supplies of big-time neighbors like Brazil and Argentina. Claiming that foreigners have taken advantage of Bolivia’s impoverished state to scrape profits outside its borders, Morales is determined to move operations under state management to funnel more money to Bolivians. Whether this is a good move will depend on the government’s oil and gas department to overcome its wretched state.
Posted by Michelle Smith at 09:15 PM | Comments (0)
January 26, 2006
No Hesitation
To the proposal that America bail out our failing auto makers, Bush has replied with bold, market-racket-esque reproach:
General Motors Corp. and Ford Motor Co. should develop "a product that's relevant" rather than look to Washington for help with their heavy pension obligations.
Phew.
Posted by Michelle Smith at 09:06 PM | Comments (0)
January 16, 2006
China's Ballooning Cushion
Sometimes riches don't always lead to happiness. As the news about China's massive amount of foreign currency reserves hits the presses this weekend, peeved U.S. economists are banging louder than ever on the country's door.
Posted by Michelle Smith at 05:51 PM | Comments (0)
December 19, 2005
'Tis the Season To Be Frugal
Mixed in with the millions of holiday cards to be opened this month will be small white envelopes stuffed with some very unfestive surprises. Credit card bills, once cheerfully polite in their requests for a mere $10 or $15 each month, will start abrasively demanding much higher minimum payments in December and January. The move is pinching shoppers’ wallets, and sparking uproar among consumer advocacy groups.
Posted by Michelle Smith at 10:08 AM | Comments (0)