Stay hungry. Stay foolish.
求知若饥,虚心若愚。
— Stewart Brand, Whole Earth Catalog

iTunes: Disable Backups / Enable Backups

Posted on 12 August 2010 by Erwin

iTunes does not provide an menu option for enabling or disabling backups, but you can manually update the iTunes preference file to do the trick. There is a preference called “DeviceBackupsDisabled”. If you do decide to disable backups on a regular basis, note that MOST of your data will automatically be synced to your phone — but your Text Messages are not synced outside of the normal iTunes Backup process.

To disable backups:

  1. Quit iTunes
  2. Open Terminal.app
  3. defaults write com.apple.iTunes DeviceBackupsDisabled -bool true
  4. Open iTunes
  5. Sync

To enable backups:

  1. Quit iTunes
  2. Open Terminal.app
  3. defaults write com.apple.iTunes DeviceBackupsDisabled -bool false
  4. Open iTunes
  5. Sync

Enjoy :-)

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Today’s Pithy, Cautionary Note on Economic Trends – Politics – The Atlantic

Posted on 24 July 2010 by Erwin

Today’s Pithy, Cautionary Note on Economic Trends – Politics – The Atlantic: “Just now at the Aspen Ideas Festival, Bharat Balasubramanian — generally addressed as ‘Dr. Bharat,’ left — an engineering executive from Daimler AG in Germany, made an off-hand observation of what globalization and tech innovation will mean for the US economy:

‘I will state that there will be a polarization of society here in the United States. People who are using their brains are moving up. Then you have another part of society that is doing services. These services will not be paid well. But you would need services. You would need restaurants, you would need cooks, you would need drivers et cetera. You will be losing your middle class.

‘This I would not see in the same fashion in Europe, because the manufacturing base there today can compete anywhere, anytime with China or India. Because their productivity and skill sets more than offset their higher costs. You don’t see this everywhere, but it’s Germany, it’s France, it’s Sweden, it’s Austria, it’s Switzerland…. So I feel Europe still will have a middle level of people. They also have people who are very rich, they also have people doing services. But there is a balance. I don’t see the balance here in the US.’

Dr. Bharat was here mainly to talk about engineering developments at Mercedes, notably a car designed to respond to collisions just before they occur (via radar and other sensors to detect imminent crashes) and apply a variety of pre-protective, hunkering-down measures. Details on the ‘Pre-Safe’ system here. But his matter-of-fact observation of why companies in the United States might match any firms anywhere in raw innovativeness and profitability, while American society as a whole becomes more polarized and caste-like, was sobering to put it mildly. Not a new theme, obviously, but presented quite starkly. Andy Grove of Intel to the same effect here;  background from the Atlantic here and here.

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Bonus ‘it’s a big world’ note: Dr. Bharat is originally from Madras/Chennai and is an alum of the storied Indian Institute of Technology/Bombay. But he went to work for Daimler as a very young man and (as he jokingly pointed out himself) now speaks English with a rich Jawohl!-style German accent rather than Indian English. This is a more charming combination than you might think.

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Longest Gap without a Post…

Posted on 19 July 2010 by Erwin

I think this is the longest I’ve ever gone between regular blog posts. Someday I’ll have to explain why ;-)

I’ve been getting ready to upgrade to IOS4.0, however IOS is inferior to Android unless you Jailbreak. Unfortunately, several of the jailbreak apps I rely on are still not yet compatible with IOS4. You can check out the full IOS4 Compatibility Chart, but the ones I’m concerned with are: * CallClear * Insomnia isn’t available for IOS4, but SBSettings has a replacement called “Keep Awake” that may due the trick for you. * iProtect * MyWi 4.0 (v3.52 no doesn’t work with IOS4) * Recent Call Delete (like Call Clear) doesn’t work with IOS4 * UDIDFaker * WeatherIcon * USB Drive

Hopefully I can get most of these worked out and install IOS4 sometime next week…

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Infographics: worthless ones giving them a bad name

Posted on 11 April 2010 by Erwin

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Dollar Peg: Bad Business For China

Posted on 18 March 2010 by Erwin

Price is what you pay. Value is what you get.

Warren Buffet

Beijing regularly complains about the “safety of it’s dollar reserves”. This political posturing makes for nice headlines and helps aggregate soft power, but your response should just be to laugh at Beijing’s naiveté and move on to the next story.

Beijing should keep some foreign currency reserves, which help to stabilize the domestic currency and encourage foreign investment. However, if Beijing did not manipulate the value of the Yuan, Beijing’s dollar reserves would not have risen to the ridiculous levels that we see now.

Today, the Chinese economy is structured to do one thing very well: make products for export. Manufacturing is a notoriously cost conscious business, and as costs in China rise, the government doesn’t want to see factories relocate en-masse to Vietnam, the Philippines, or other lower cost regions. Under normal circumstances, currencies trade a lot like stocks, prices go up and down relative to each other every day. However, every day the Chinese Yuan is worth the same amount of US Dollars. For almost 2 years, it’s been pegged at about $1.00 USD = ¥6.83 Yuan.

Trading Dollars for Yuan.

China didn’t pass a law saying that each dollar is worth 6.83 Yuan. Nobody will be tortured, jailed or executed for trading Dollars for Yuan at another rate. Instead, China’s central bank, The People’s Bank of China (PBoC), has created a policy that no matter what, they will sell you ¥6.83 Yuan for each $1.00 USD. The value of the Yuan is less than ¥6.83. Perhaps the value is ¥6.8, perhaps it’s ¥6.0, it might even be ¥5.0 or ¥4.0 for each $1 USD. However, since the PBoC is willing to sell Yuan at such a discounted price, they have a monopoly on the market. There’s no free exchange market for the Yuan, so nobody, including the PBoC can figure out exactly what the value of the Yuan should be, but the price is set by the PBoC.

Trading Yuan for Dollars

Selling Yuan is a little different story. If you have Yuan, and you want to sell them for Dollars, the PBoC doesn’t make life easy for you. Yuan sellers have to register with the PBoC and request foreign exchange. The PBoC has the choice on whether or not the Yuan sale will be permitted. For anyone investing in China, this is a very important fact to be aware of – one that I expect will bite a lot of foreign investors if the Chinese Real-Estate market bubble were to pop.

Since the PBoC is willing to give you such a great price when you sell dollars and buy Yuan, there is automatically an inward flow into Yuan, in spite of the risk that the PBoC may not let you convert Yuan back into dollars when you want to take your money back out.

If you torture the data long enough, it will confess.

Ronald Coase

The Big Pile of Dollars

As long as the PBoC keeps the peg, all of the dollar reserves that are acquired are valued by the PBoC at the price that the PBoC paid, even though the value is less than the price paid. Everybody knows that the PBoC is selling Yuan very cheap, so even more people buy Yuan (or other Chinese assets) with the intention of selling them back as soon as the price of the Yuan rises to match it’s value. Combine this with the fact that the Chinese economy is designed to produce exports, and you’ve got a recipe to up with a lot of dollars.

The PBoC has an account full of dollars corresponding to all of the Yuan, Yuan valued exports, and Yuan assets that China has sold to the rest of the world. This pile of dollars is massive and grows quickly. Since some interest on this money is better than no interest at all, the PBoC lends a lot of these dollars back to the US Federal Government, helping to finance both annual deficits and the overall debt, and pushing down interest rates.

Losses: Real or Realized

If the actual value of the Yuan in dollar terms was ¥6.70, but the PBoC’s currently pegged rate were ¥6.80, then every single time the PBoC trades a Dollar for a Yuan, it would be loosing ¥0.10 Yuan for every dollar traded. The bigger the gap between the rate that the PBoC is willing to pay for Dollars, and the the value of the Yuan, the bigger the loss on each trade. Central Banks are funded by Tax payers, so money loosing policies like this are not unheard of.

Every day for several years, the PBoC has been paying top dollar to buy dollars, even though the Dollar has been going down relative to other currencies (Euro, Yen).

(In case you didn’t notice, the flat line, least changed against the dollar, is the Chinese Yuan)

The PBoC re-values the Yuan, either by allow it’s price to be set by the market, just like the Dollar, the Euro and the Yen, or by raising the price the PBoC sells Yuan (perhaps only 6.0 Yuan for each dollar instead of 6.8 today).

THE CATCH, is that even though the PBoC is loosing money every time it buys dollars, from an accounting perspective it doesn’t look like a loss. It’s not until the price of the Yuan increases, the loss will finally look like a loss, a huge loss, to every accountant on the planet.

After the smoke clears

Someday, the PBoC will stop operating as the discount Yuan seller, thereby slowing down their accumulation of dollars, and correspondingly reducing demand for interest payments on their big pile of dollars. Less demand for dollar interest, means that the price of financing debt is going to go up. You’re not going to have many more chances to get a 30-year fixed mortgage at 5% — it was 12% in 1985.

The rising Yuan could be extremely dangerous for the Chinese economy, because there isn’t any other sector that could replace China’s manufacturing jobs. Though there are many well educated and talented Chinese entrepreneurs, the unpredictable regulatory and legal framework make investment in any R&D very high risk. Without further political reform, China appears to be stuck at the bottom of the value chain, in the Manufacturing department.

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The Internet Bubble – Popped – 10 Years Ago Today

Posted on 14 March 2010 by Erwin

BBC put together an interesting review of Internet stock bubble, that ended on March 10, 2000.

February 2000:

David: If your not a media stock, dot-com stock or a telecom stock, valuations are very low.

BBC: So what you’re saying David is that it’s really the result of this asset bubble. In other words, the actual stock market value of these companies was way out of line, compared to their potential to earn money.

David: Right, and I think that was fairly widely known. In our consciousness, it was just way out of whack. But, every day you heeded it, or you got left behind. These things were going up by the day, they were going up by the rate of warp seed, regardless of whether they had earnings or not.

BBC: Though you though it was all a bit ridiculous, you still felt you had to keep recommending these dot-com shares to your clients.

David: Looks, this seems kinda ridiculous, maybe we should look at pulling back on the aggressiveness of your styles, because they had all of the proof they needed – in their track record. It was fabulous. And it was very difficult to convince them of any other type of approach to what they were doing. I think it was quite difficult to tell clients to pull back, when every month they were making another 5-10%.

The Internet stock bubble was a classic stock market speculative bubble. The 2007 subprime crisis is a bubble in credit and the price of money. The discussions people were having about Internet Stocks in February 2000 sure sound a lot like discussions about the Chinese Real-Estate market.

They had all of the proof they needed – in their track record.

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Run WordPress Locally. No need to modify the DataBase!

Posted on 13 March 2010 by Erwin

Simply add the following lines to your “wp-config.php” and you’ll be able to run your same WordPress code and use your same WordPress database on both your live server and your local development server.

function WP_LOCATION () {
    $script_path = realpath(dirname($_SERVER['SCRIPT_FILENAME']));
    $wp_base_path = realpath(dirname(FILE) . DIRECTORY_SEPARATOR . '..');
    $web_subfolder = substr( $script_path, strlen($wp_base_path)); 
    $wp_path = $web_subfolder ? substr( dirname($_SERVER['SCRIPT_NAME']), 0, -strlen($web_subfolder) ) : dirname($_SERVER['SCRIPT_NAME']) ;
    $retval = 'http' . ($_SERVER['HTTPS'] ? 's' : null) . '://' . $_SERVER['HTTP_HOST'] . $wp_path ;
    return $retval;
}
define('WP_HOME',WP_LOCATION());
define('WP_SITEURL',WP_LOCATION());

If you use BBpress, you can so something very similar, but edit the bb-config.php

function WP_LOCATION () {
    $script_path = realpath(dirname($_SERVER['SCRIPT_FILENAME']));
    $bb_base_path = realpath(dirname(FILE) . DIRECTORY_SEPARATOR . '..');
    $web_subfolder = substr( $script_path, strlen($bb_base_path));
    $retval = 'http' . ($_SERVER['HTTPS'] ? 's' : null) . '://' . $_SERVER['HTTP_HOST'] . $web_subfolder ;
    return $retval;
}
$bb->uri = WP_LOCATION();

I’ve updated the WordPress documentation under Running Development Copy of WordPress to note the discovery.

If manually running SQL updates make you feel happy and productive, then you may prefer running the manual database update on your local development system each time you copy the database off live. For your reference, the SQL command to do the trick is:

SELECT * FROM wp_options WHERE option_name = "home" OR option_name = "siteurl";
UPDATE wp_options SET option_value = "http://localhost/local_folder_name" WHERE option_name = "home" OR option_name = "siteurl";

Don’t forget to change local_folder_name to you’re actual local WordPress path. To make development simpler, I recommend updating your /etc/hosts and adding aliases for your local sites. For example:

127.0.0.1 localhost XYZproject.local PDQproject.local otherProject.local

Then setup separate VirtualHosts for each of your projects, and access them with the alias defined in your hosts file.

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Safari Session Management

Posted on 08 March 2010 by Erwin

Ever since Safari 3, the History Menu added “Reopen Last Closed Window” and “Reopen All Windows from Last Session”. The session information is stored inside ~/Library/Safari/LastSession.plist. When Safari crashes, the crash causing tab will typically be opened again, and Safari will crash again. Download the “LastSession” python script from radiotope to get a list of the Safari sessions that were last active.

For easiest use, download the LastSession python script, make it executable, and save it to your /usr/bin or /usr/local/bin folder:

chmod 755 ~/Downloads/readLastSession..py
sudo mv ~/Downloads/readLastSession..py /usr/bin/lastsession

You can also use the Window/Merge All Windows command followed by Bookmarks “Add Bookmark for These 99 Tabs” to easily save you’re entire workspace.

Mac OS X Hints posted about creating “Time Machine” like Session History for Safari by storing version history of the ~/Library/Safari/LastSession.plist file. Version history can be combined with the “readsession” script to get an even longer list of URLs…

There are currently three session management options for Safari, all of which have been updated to work with Safari v4.0.

  • SAFT: InputManager plugin, SIMBL plugin, or Safari Launcher. $15.

    • Add bookmark folder here and add bookmark here in every bookmark menus
    • Save and load browser windows
  • Safari Stand: SIMBL plugin. Free.

    • Bookmark Shelf for visually managing multiple browsing sessions
    • Restore Last Workspace Window that is 100% crash proof
  • GLIMS: Free.

    • Re-open last session when Safari starts
    • Re-open tabs in single window
    • Undo Close Tab (CMD+Z)
    • Unfortunately, GLIMS “re-open last session” is only updated when Safari exits, so it doesn’t protect you when Safari crashes. GLIMS provides a ton of interesting options, primarily related to the Safari “Search Field”, but doesn’t do much in the way of Session Management.
  • Forget Me Not: SIMBL plugin. Open Source. Free.

    • Reload windows and tabs when you relaunch Safari
    • File / Unclose Window
    • Edit / Undo Close Tab
    • Forget Me Not is about making Safari easier to use, rather than specifically about managing your session in Safari.

Bottom line: The only plugin that really brings Saft session management to the next level is Saft.

To minimize Safari crashes, you can also use the excellent Click To Flash plugin, which has the pleasant side effect of forcing Youtube to play back in QuickTime rather than Flash.

Next project: Synchronize Safari sessions across multiple machines

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Why Tibet will not be Free

Posted on 07 February 2010 by Erwin

Occam’s razor: The simplest explanation tends to be the best one.

During WWII, the Japanese conquered the entire eastern seaboard of China. Every port from Hong Kong to Harbin was in the hand of Japanese forces. President Roosevelt promised Generalissimo Chiang Kai-Shek military support to avoid total Chinese defeat.

In 1942, the allies were left with no over land or over sea route to China. The result was a 24 hour-a-day, 7 day-a-week airlift from Assam province, in the northeast corner of India, over the Himalayan Mountains, into Kunming in southwest China. This 525 mile long sky route, flown by Americans and Chinese, transported every allied soldier, every C-ration, every M-16, every condom, everything supplied by the western allies.

August 14, 1945: V-J Day. Japans Emperor Hirohito surrenders, ending WWII.

October 1st, 1949: Chinese Civil War Ends. People’s Republic of China founded.

After spending a year consolidating control over the mainland, the People’s Liberation Army marched into Tibet. The official Chinese line is that they: “Liberated the Tibetan People from Feudal Serfdom under the aristocratic Lamas”. The Tibetan government fled from Lhasa to India, forming the Tibetan government in exile, which claims that the “Chinese have deprived Tibetans of self-determination”.

Post Chinese control of Tibet, there have been discussions about: * The oppression of the Tibetan people under the feudal Lamas * The oppression of the Tibetan people under the Communists * Hundreds of years Chinese history of Beijing controlling the selection of Lamas * Hundreds of years of Tibetans themselves selecting the Lamas * Campaigns of propaganda, oppression, subversion to impact the Tibetans and/or Chinese


Richard Gere campaigns for a Free Tibet. The CIA is on the record for covert support of Tibetan resistance fighters and subsidy to the Dalai Lama. Many Americans campaign for a “Free Tibet” and have the bumper stickers to prove it. To understand the future of Tibet, we need to understand why the Chinese took control of Tibet.

Looking at a political map, the situation doesn’t make a lot of sense. But looking at a topographic map, the situation is more clear. Tibet is massive – nearly twice the size of Texas. In 1950, Tibet was not a strong nation. The British forces in India mounted expeditions to invade Tibet and force trading relations from 1904 – 1911, and a portion of Tibet is claimed by India to this day. India went to war with China in 1962 over this, but China held the territory.

If technology of the 1940s could enable Kunming, in mountainous south east China, to be the terminus of freight route that helped create a stalemate against adept Japanese forces, then Tibet could be the corner stone of the next foreign attack on China.

After the Tibetans surrendered, their remaining representatives signed the “17-point Agreement” of surrender. There is some fluff in the middle of the agreement, but the first two points give you a good understanding of why the Chinese took control of Tibet:

  1. The Tibetan people shall be united and drive out the imperialist aggressive forces from Tibet; that the Tibetan people shall return to the big family of the motherland – the People’s Republic of China.
  2. The Local Government of Tibet shall actively assist the People’s Liberation Army to enter Tibet and consolidate the national defenses.

Bottom line, at least from the prospective of Beijing, Tibet is a vital part of China’s National Security.

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The Economist comments on Bihar, India – just across Nepal from China

Posted on 30 January 2010 by Erwin

India’s most notorious state is failing to live up to its reputation

And to overcome what one minister describes as a “crisis of implementation”—teachers who don’t teach, nurses who don’t nurse, roads built but not maintained, funds received but not spent—he will have to overcome the most obdurate caste of all: the local bureaucracy.

More than the floods that frequently test Bihar’s embankments, local officials fear the rising expectations of people who no longer meekly accept their lot in life. Their instinct is to contain the waters by discouraging such self-assertion. But it is only by giving people their say, by turning unmet need into a political demand, that the state apparatus will begin to do its job.

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Christian Science Monitor weights in on China bubble

Posted on 30 January 2010 by Erwin

Gordon Chang, author of “The Coming Collapse of China“, published in 2001. The book predicted the China would collapse by around 2005, or perhaps as late as 2010. He predicts that widespread unemployment, government corruption, inefficient state owned enterprises, and a lack of leadership would lead to the undoing. Publishers Weekly comments:

His invocations of the “power of the Chinese people,” or of an imaginary individual who will one day “end the Chinese state as it now exists,” read more like political soap opera than judicious analyses.

One of the Amazon commenters summarized Mr Chang’s POV as:

“The Coming Collapse of China” is an angry book written by the son of a man who “left China before the end of the Second World War and [the son] grew up hearing him say that Mao Zedong’s regime would have to fall.” The son returned to China to work as a lawyer in Shanghai. When he wrote this book – his first – it was a polemic in which he pounded away at the evils of Communism and predicted that Jiang Zemin’s regime would have to fall.

The Christian Science Monitor published Mr Chang’s “China: the world’s next great economic crash” article in the Opinion section this week. The truth is probably somewhere in between the current China Euphoria (rise of China is story of decade) and Mr. Chang’s China Collapse POV. For the record, I’m optimistic that China will be in a very strong position by 2050, with living standards in the largest cities (Beijing, Shanghai, Guangzhou) at parity with Taipei and Hong Kong. However there is a massive asset bubble in China that is hurting all but the wealthiest 0.5% (85% of families can’t afford basic housing). 40% of local gov’t revenues come from land sales (Professor Chovanec) and current GDP growth is fueled by real estate development.

The following is an [objective?] look at the current China situation:

Beijing, ignoring advice from Washington and other capitals, did not in the boom times try to restructure its economy to favor consumption. Instead, the Chinese government sought to take maximum advantage of then-surging foreign demand. The role of consumption, therefore declined – falling from a historical average of 60 percent of the economy to about 30 percent last year. No country has a lower rate.

To make up for slumping demand abroad and sluggish consumer spending at home, the State Council, the central government’s cabinet, announced a stimulus plan in November 2008. Beijing originally said it would spend $586 billion through 2010. In the first full year of the program however, it has directly and through state banks disbursed about $1.1 trillion in stimulus funds.

The plan, not surprisingly, is creating gross domestic product, but growth is an artificial “sugar high.” For one thing, Beijing’s stimulus spending last year was around a quarter of the total economy. Now, perhaps as much as 95 percent of China’s growth is attributable to state investment, as a Chinese analyst noted recently.

Despite the massive state spending, the country’s economy is not particularly robust. Power consumption statistics, a crucial indicator of economic activity, show the economy expanding at only two-thirds the announced rate.

Moreover, essentially flat consumer prices last year belie official reports of roaring retail sales. So does the full-year 11.2 percent decline in imports, another sign of sluggish domestic demand. And if the economy is really growing by double digits, why is Beijing insisting on continuing its stimulus?

New York Times columnist Thomas Friedman, however, thinks none of this will be a problem. Arguing that China is not the next Enron, he gives this advice to Mr. Chanos: “Never short a country with $2 trillion in foreign currency reserves.”

Yet Beijing’s record-setting reserves – now $2.4 trillion – are essentially unusable for this purpose. Why? China’s leaders need local currency, the renminbi, to deal with domestic needs. If they convert reserves into renminbi, they will cause the currency to zoom up in value and choke off the critical export sector. Foreign reserves have only limited uses in domestic crises.

Second, the state’s stimulus plan is taking the nation in the wrong direction. It is favoring large state enterprises over small and medium-sized private firms, and state financial institutions are diverting credit to state-sponsored infrastructure. Over the past three decades, China’s economy has expanded at an average annual rate of 9.9 percent because of the private sector, but now Beijing is renationalizing the economy with state cash.

Third, Beijing’s flooding of state enterprises with government cash will undermine their competitiveness, as a similar tide of money severely damaged Japan’s corporations during the bubble years.

Japanese managers discovered they could make more money managing cash than from anything else, and they therefore neglected their underlying businesses. Essentially the same thing is happening in China.

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The USA and Regional Security in Asia (Part 2)

Posted on 30 January 2010 by Erwin

Until the Real Estate Super Bubble finally pops here, I’ll smile anytime I see “China” and “Bubble” in one sentence. From The Economist’s asia column titled “Japan’s love-bubbles for China“.

WHAT our colleague, Charlemagne, calls “bubbles of optimism” over China have been popping in Western capitals, as China has taken a hard line against internal dissent, proven unhelpful in efforts to tackle both climate change and Iran’s growing nuclear threat, manipulated its currency and launched cyber-attacks on Western computer networks. China, muscling its way to global prominence, is not quite the partner the West had been cultivating. Striking, then, that in Japan the bubble of optimism, among the country’s new leaders, is only inflating.

Reuters’s most read story of the decade is the “Rise of China“. The rise started with China’s entry into the WTO – in contrast to Russia who’s never been a WTO member. Western businesspeople and politicians believed that WTO membership would mean China plays by the same rules as the rest of the allies: UK, Germany, France, Japan, Korea, etc. Open markets. Rule of law. Migrating their way toward first world standards. That’s what we’ve seen from the Chinese in Hong Kong and in Taiwan, but there is ever growing skepticism that the same transformation will happen in China.

Now rumors suggest Mr Hatoyama may make a visit of remorse, the first by a Japanese prime minister, to Nanjing, site of a massacre by Japanese forces in 1937. In return (and at less political cost), Mr Hu may pay respects to the nuclear victims of Hiroshima.

In the eyes of Chinese people, the “Little Japanese Devils” are their mortal enemy. The Japanese raped and pillaged in Manchukuo, and even committed specifically horrible atrocities in Nanjing. The Gov’t regularly stokes up anti-Japanese sentiment, so the potential patching up of the relationship could immediately alter the balance of power in asia.

History wars, still far from resolved, point to the limits of rapprochement. So too do maritime disputes over territory. But a huge constraint is the fiscal one. Greying Japan is burdened with deflation, stagnant growth and a national debt close to 200% of GDP. Japan lacks the resources (and the will) for the kind of bold strategic moves, putting Japan at the heart of Asia, at which Mr Hatoyama and Mr Ozawa hint. Even a more autonomous security policy, out from under America’s wing, is almost a non-starter. Japan has cut its defense spending in recent years, to just 1% of GDP. It has grown more dependent on the United States, not less.

The commonly accepted debt numbers are: Japan @ 200% of GDP, USA @ 100% of GDP, and China @ 15-30% of GDP. These numbers are interesting, however the Chinese public debt to GDP ration is probably actually closer to 62% – comparable to the western european average.

Due to the one-child-policy, China is also greying, though not quite as fast as Japan. China also has a 117:100 male to female ratio, meaning that 1 in 5 boys won’t be able to find a mate. Compared to 105:100 in Japan and the USA.

Moreover, only 15% of Chinese Chinese can afford to purchase a home – not even the basic 50 sqm (550 sqft) that most Chinese families reside in. Under these circumstances, even getting married and having a family is a luxury beyond the reach of far too many mainland Chinese.

Note: public debt is the cumulative total of all government borrowings less repayments that are denominated in a country’s home currency. Public debt should not be confused with external debt, which reflects the foreign currency liabilities of both the private and public sector and must be financed out of foreign exchange earnings.

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The USA and Regional Security in Asia (Part 1)

Posted on 30 January 2010 by Erwin

In Does American Need a Foreign Policy, Henry Kissinger suggests that America’s best role in Asia is similar to the UK’s role in europe.

A hostile Asian bloc combining the most populous nations of the world and vast resources with some of the most industrious peoples would be incompatible with the American national interest. For this reason, America must retain a presence in Asia, and its geopolitical objective must remain to prevent Asia’s coalescence into an unfriendly bloc (which is most likely to happen under the tutelage of one of its major powers). Americas relationship to Asia is thus comparable with that of Britain toward the content of Europe for four centuries. Winston Churchill described that situation eloquently:

For four hundred years the foreign policy of England has been to oppose the stronger, most aggressive, most dominating Power on the Continent… These four centuries of consistent purpose amid so many chances of names and facts, of circumstances and conditions, must rank as one of the most remarkable episodes which the records of any race, nation, state, or people can show. Moreover, on all occasions England took the more difficult course. Faced by Philip II of Spain, against Louis XIV under William III and Marlborough, against Napoleon, against Wiliam II of Germany, it would have been easy and must have been very tempting to join the stronger and share the fruits of his conquest. However, we always took the harder course, joined with the less strong Powers, made a combination among them, and thus defeated and frustrated the continental military tyrant whoever he was, whatever nation led. Thus we preserved the liberties of Europe, protected the growth of its vivacious and varied society… It is a law of public policy which we are following and not a mere expedient dictated by accidental circumstances, or likes and dislikes, or any other sentiment.

In the twenty-first century, an analogous objective for the United States in Asia poses a more complex challenge. The European balance of power was sustained by nation states of substantially homogeneous ethnic composition (with the exception of Russia); many of the major Asian states (China, Russia, India, Indonesia) are continental in size and multiethnic in composition. The European equilibrium was seamless in the sense that all major states were part of it – that is, the interplay of their alliances constituted the balance of power; thus a crisis over Serbia in the Balkans escalated into the First World War. The Asian balance of power is more differentiated and therefore more complex.

In Europe, two world wars and the insufficient scale of the European nation-state in the face of global challenges have made the nineteenth-century balance of power irrelevant. The nations of Europe no longer treat one another as strategic threats; threats from outside Europe have been dealt with by the alliance with the United States.

By contrast, the nations of Asia have never acknowledged a common danger, having quite differing views about what threatens their security. Some have historically feared Russia; others worry mostly about China; still others are concerned about a resurgent Japan; some in Southeast Asia consider Vietnam the principal danger. India and Pakistan are each obsessed with the threat of the other.


To be sure, it is in the American national interest to resist the effort of any power to dominate Asia – and, in the extreme, the United States should be prepared to do so without allies. But a wise American policy would strive to prevent such an outcome. It would nurture cooperative relations with all of the significant nations of Asia to keep open the possibility of joint action should circumstances require it. But it would also seek to convey to China that opposition to hegemony is coupled with a preference for a constructive relationship and that America will facilitate and not obstruct China’s participation in a stable international order. Confrontation with China should be the ultimate recourse, not the strategic choice.

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Chinese Numbers: NetEase and Others

Posted on 29 January 2010 by Erwin

Why is “NetEase” known as 163.com? Originally, China Telecom (电信) and China Mobile (移动) we’re both part of China Post (邮政局). During those days, Chinese people who wanted to use the internet all dialed up via modem to: 163. That’s right, 163 was the phone number to access the internet – no other digits required. In those days, you would buy a pre-paid card to get a temporary username and password.

Why 6.cn, 56.com, ku6.com? In Chinese 6 is just a very lucky number. When Chinese people turn 60, it’s a very big deal – called “dàshòu (大寿)”. Why 60? Because it means that you went through all 12-years of the terrestrial cycle shēngxiào (生肖) 5-times.

Nine is also a lucky number both because 9 is the biggest number and it sounds like “久” (jiu) – the word for permanence.

Of course 8 is the luckiest of them all. Why? Because 8, in Chinese is pronounced “bā” which is very similar to “fā”, as in fācái (发财) – to get rich!

There are also lots of times you’ll see “168″. Why? 168 means “一路发” (yi lu fa) – the road to riches.

However 0, 1, 2, 3, 6 and 7 don’t have any special meaning. They’re neither positive or negative.

Office on the 4th floor? Not likely, because most Chinese buildings don’t have a 4th floor. The Chinese word for death sǐ (死) sounds a lot like the number 4 (四), pronounced sī. Most western buildings don’t have a 13th floor.

On that note, do you know why western culture is sensitive to the number 13? Legend has it Friday the 13th was the day Jesus was crucified, additionally the 13th guest at the last supper was Judas – the apostle who betrayed Jesus to the romans resulting in crucifixion. Ancient Persians, assigning the twelve constellations of the Zodiac to the months of the year, and though the 13th represented the destruction that would follow the completion of the Zodiac cycle. More about unlucky 13.

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State of the People’s Republic

Posted on 29 January 2010 by Erwin

From President Obama’s State of the Union address.

We can’t afford another so-called economic “expansion” like the one from the last decade — what some call the “lost decade” — where jobs grew more slowly than during any prior expansion; where the income of the average American household declined while the cost of health care and tuition reached record highs; where prosperity was built on a housing bubble and financial speculation.

Interesting that this sounds a whole lot like the so-called economic “expansion” here in China…

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