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The Fed is day dreaming again July 17, 2017

Posted by hslu in Economics, stocks, Stocks.
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Source: Deutsche Bank, Torsten Slok 

The Feds have been consistently optimistic about their ability to predict the arrival of inflation, hence the need to raise interest rate. This chart from Deutsche Bank’s Torsten Slok says it all. The mid points discussed in the chart refer to Fed’s famous dots which are Federal Reserve governors’ predictions of where interest rates will be in the future.

Btw, the Feds haven’t been able to predict the arrival of recessions in the past either. Ditto on asset bubbles and financial crisis.

If they were students in a school, they will get an F based on their records.

After all, the Feds governors are mere mortals. Fed’s recent rate hikes to fight the threat of inflation are probably nothing more than figments of Feds governors’ imaginations.

In engineering language, the governors pick a number from thin air before a board meeting, apply a fudge factor, consider historical trends, add their own intuitive judgement, pass it around for comments, make the necessary modification and call it their official predictions.

The bigger questions are:

  • Why are they so wrong in their predictions in the past,
  • Didn’t they learn from their past mistakes and apply one more adjustment, say a cross the board reduction of 40% to their guesstimates?
  • Does anyone in the financial world listen to them and use their numbers to make investments accordingly?
  • Should individual investors just ignore them all together?

Should these governors be replaced since they fail their tasks so many times?

Fundamental attribution error and inequality July 6, 2017

Posted by hslu in Economics, education, Social Issues.
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Why do we think poor people are poor because of their own bad choices?


The article didn’t talk about public policies which are partly responsible for creating the inequality in the first place. Requring food stamp holders to work for the benefits will reduce the number of people in the program. A recent report documented this.

Unless someone is didabled, ask him or her to work for his or her benefit will help build his/her character and working experience so that he/she can return back to the workforce and make a living instead.

BBC News: The end of the Anglo-American order? July 6, 2017

Posted by hslu in China, Cold War, Economics, Energy, Global Affair, Globlization, Middle East, Oil, Shanghai, U.S. Foreign Policy.
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I saw this on the BBC and thought you should see it:

The end of the Anglo-American order? – http://www.bbc.co.uk/news/world-us-canada-40227270

With China being the largest crude oil importer in the world, with Renminbi being accepted by central banks as a reserve currency and with Saudi Arabia and some OPEC countries don’t like what America is doing in the Middle East, is it likely that we will soon see crude oil being traded at Renminbi instead of the U.S. dollar? 

Of course I am not talking about all oil trades will be settled on Renminbi but what about bi-lateral oil trades between Saudi and China and Nigeria and China. You know which side Rusdia stands on this. 

The Renminbi bilateral swap lines between China and 33 (wiki data) other countries will be replaced with a new trading platform next year. In the past, these swaps were cleared by SWIFT which is under America’s influence. The new platform will be under China’s control and will be located in Shanghai away from SWIFT.

The world order is fast changing in front of our eyes if you care to look.

Finally, something good from the Trump WH May 21, 2017

Posted by hslu in China, Economics, Trump.
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Remember these tweets and statements from Trump on China: 

“currency manipulator,” 

“unfair trade partner,” 

“raping our nation,” 

“we have a lot of power with China,” 

“theft of American jobs,” 

“lost 60,000 factories,” 

“Did China ask us if it was OK to devalue their currency?” 

“when Donald J. Trump is president, China will be on notice that America is back in the global leadership business and that their days of currency manipulation and cheating are over,” 

“I would do a tax. And the tax, let me tell you what the tax should be … the tax should be 45%,”  

And we all know what kind of person Trumo is: “he (Trump) is someone going to carry through on what he says.” 

Then of course we had these words from China:

“We hope President-elect Donald Trump, who will very soon go into (the) White House, will handle himself with respect, accountability and responsibility and become a force of peace and stability rather than making whimsical and capricious remarks aimed at surprising the world.” 

So, after a war of words, what do we have recently? A trade agreement between China and the U.S of A.

So, did Trump lie? Maybe Trump simply didn’t know what he was talking about. Well, on the other hand, maybe Trump was a smart cookie by talking tough before doing a deal.

We’ll find out what kind of person Trump is: a born liar or a smart business man.

Definitely May 14, 2017

Posted by hslu in China, Cold War, Economics, Global Affair.
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The more trouble America has, the better it is for the world and China.

The U.S. opposed One Belt One Road and the BRICS Bank (now the New Development Bank) when Xi Jinping first proposed this strategic alliance in 2013 and later threatened its allies not to joint this initiative. None of them except Japan took American advice.


Because the United States realized that it threatened America’s leadership in the world. 

So what America did to counter this threat? Pivot to the East.

Now the U.S. and Japan want in. 恬不知恥是也。

Just make them second or third tier observers with no right to vote.

BRI vs PE.

I for one like to see BRI took the lead not only on world trade but also on making friends in the world for decades and cennturies. What America leadership gave the world was one firthy rich and powerful bully, a few so-called allies, a poppy, a pawn and many enemies.

Anti-Trump sentiments, THAAD and Moon May 12, 2017

Posted by hslu in 美國, Economics, Global Affair, Middle East, Muslim, Obama, Russia, Trump, U.S. Foreign Policy.
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Trump believes that being the president of the most powerful nation in the world entitles him to demand other nations to do whatever he wants. 

It doesn’t work that way.

Trump wanted South Korea to pay $1 billion for the deployment of THAAD which angered South Koreans because THAAD wasn’t really designed to protect South Korea against missiles from the North. America forces THAAD on SK because it needs to monitor China and Russia as America “pivoting to the East.” In the end, the State Department quietly announced that America tax payers will pay for the deploytment. Trump ate his own words again.

In fact, 56.5% of South Koreans, according to a recent poll, want the deployment of THAAD suspended and leave the decision to the new government. 

But, after SK and the U.S. agreed in July 2016 to deploy one THAAD battery in SK, U.S. sent two mobile launchers to a U.S. military base in SK in March 2017 because America wanted to speed up the installation before a new government comes into power in May 2017. 

However, THAAD deployment has been under fire from the get-go because it was made without parliamentary approval and discussions by the public. The heavy-handed approach by the U.S. government against the will of majority of the South Korean people angered the opposition party which swept Moon Jae-in (文在寅) to the office. Of course, Park’s indictment decimated her party which also helped Moon won the election.

Trump’s bullying personality and his unorthodox foreign policy maneuvers destablized the balance of power in many countries and upset other nations’ politics because Trump’s ascent to power emboldened the populist movements worldwide.
This isn’t good for the U.S. because the strategic alliances cultivated by the U.S. over the past five decades are in danger of breaking apart. Many new governments, e.g., Phillippine and South Korea, may adapt anti-U.S. foreign policies and several pro-America royal family rulers in the Middle East might face renewed oppositions at home. 

None of that is good for the United States. America is threading dangerous water now. It will get worse and the end isn’t near at all.

不懂 April 22, 2017

Posted by hslu in Culture, Economics, education, Food, Japan, Life, Taiwan.
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漢人在台灣籌建的水利工程有七個,奠立了台灣水利工程的基礎,民進黨視若未睹,視而不見,而日本人建立了一個圳就視同”恩同再造”,感激涕零,最諷刺的是,日本人建的那個圳灌溉出來的稻米都運回日本供”上等日本人”吃,而下等人種台灣人當苦力,卻吃不到該圳帶來的任何好處。現在台灣人對曾奴化台灣,殺害台灣人的日本人卑躬屈膝,磕頭喊”皇恩浩盪”,卻對祖先所留下來的功績,隻字不提,台灣人的是非顛倒,舉世無雙,令韓國人吃驚,令國際傻眼,令人浩瀚! 是誰愚弄台灣把臺灣人教育成如此的愚痴? 

台灣在日本311地震捐了57億台幣給日本,超過另外92個國家的總和(含美國,歐盟,G7工業國,…),讓日本人受寵若驚,台南大地震時,日本人卻只捐了5000萬台幣來”回敬”台灣人的功德(台南是全台最綠最感恩日本的地方),連百分之一都不到 ! 現在菲律賓和中國友好,菲律賓人到黃岩島去捕魚,中國也不驅趕,裝沒看見,台日要是友好的話,台灣人到沖之鳥礁的國際海域(公海)去捕魚,日本人為何用軍艦來驅趕?這是日本人”感恩”台灣人的方式? 台灣人還沒看清日本人的嘴臉嗎?

韓國人強悍,所以日本人怕韓國人! 台灣人諂媚,所以日本人瞧不起台灣人! 這也是這十幾年來,台灣韓國競爭力反轉的最大原因——-在1997,台灣的GDP幾乎是南韓的2倍,過了8年,2005年,韓國GDP就超過台灣,現在更遠遠將台灣拋在後面,韓國人早就沒把台灣看在眼裡,跟日本人一樣,鄙視台灣,悲哉!





Democrat Party: start your election engine April 18, 2017

Posted by hslu in Congress, Economics, Obama, Obamacare, Trump.
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I think Democrat has a small chance to capture the majority of the House of Representatives in 2018 because it is difficult to overcome the 44 seat advantage enjoyed by the Republican Party.

That being said, Democrat only needs to win a net of 24 seats to make Pelosi the speaker of the House. If it happens in 2018, Trump will be in deep s**t. Do you see the big “I” word on the wall?

Source: wikipedia

Republican’s has a four seat advantage over the Democrat Party in the Senate right now which means that Democrat only has to win net three seats in November 2018 to become the majority party in the Senate. However, the outcome is not certain for Democrats because Republicans have 9 seats up for grab while Democrats have 23. The independents, who caucus with Democrat, have 2 seats up for election.

Other than Obamacare, Obama actually had nothing to show of in 8 years. The Republican Party has about 19 months to overturn the Obamacare. Once Obamacare is repealed under Trump and Ryan, Obama will be wiped clean completely. 

Talent drain will sink America fast April 18, 2017

Posted by hslu in Economics, jobs, Technology, Trump.
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Trump got it backwards. His order will back fire.

It will send more qualified high tech workers back to their own country.

Average: $31,644; Median:  March 31, 2017

Posted by hslu in Economics, Retirement.
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According to a report from the Economic Policy Institute, the mean retirement saving of a family between 32  and 37 years old is $31,644.

Not good. 

Fidelity advices that if you want to have enough to retire at 67, you should have 3 times of you salary saved by 40. By the time you reach 67, you should have 10 times of your salary saved.

In Q4 2016, the median wage for an American worker is $44,158/year (Bureau of Labor Statistics). Since wages vary widely depending on worker’s occupation and age, we’ll use BLS data to calculate the amount you need to stash away for retirement: $132,474.

In other words, our average American worker has managed to accomplish 24% of his retirement goal.

Since average isn’t a good way to tell the entire story, let’s use median to see how American people are doing in their retirement saving department:

The same BLS report put the median amount for families between 32 and 37 is:

Drum roll, please!


Pathetic, isn’t it?

Let see, how much does our average family owe on its 10 (just aguess) credit cards? What’s the balance on its student loan if it is fortunate enough to have a college education? 

So, who is going to take care of our average American worker after he or she reaches retirement?

Pension? Very few companies offer it these days.

Social security benefit? Average SS benefit is about $1,341 in 2016. Definitely not enough to live on. Worse, social security may bankrupt in less than 30 years.

Food stamp? Don’t count on it because America has bankrupted for decades.


Looks real bad.