Educate yourselves........This is very interesting Economics I read in an article and think u all should read it as well.
Consider NEO-ECONOMICS: SAVINGS AS SIN, SPENDING AS VIRTUE
Japanese save a lot.
They do not spend much.
Also Japan exports far, more than its imports.
Has an annual trade surplus of over $100 billions, which is Rs.5 lakh crores.
Yet,
Japanese economy is considered weak, even collapsing.
Americans spend, save little.
Also US import more than it exports.
Has an annual trade deficit of over $400 billions, which is over Rs.20 lakh crores.
Yet,
The American economy is considered strong and trusted to get stronger.
Indeed a contrast.
But where from do Americans get money to spend?
They borrow from Japan, China, and even India.
Virtually others save for US to spend.
Global savings are mostly invested in US, in dollars.
India itself keeps its foreign currency assets of over $50 billions in US securities.
China has sunk over $360 billion in US securities.
Japans stakes in US securities is in trillions.
Result...
The US has taken over $5 trillion from the world.
Want to know it in rupee?? Rs.2,50,000 crore crores!
So, as the world saves for US,.
Americans spend freely.
Today, to keep the US consumption going, which is for the US economy to work, other countries have to remit $180 billion every quarter, that is $2 billion a day, to the US! Otherwise the US economy would go for a six.
So will the global economy.
The result will be no different if US consumers begin consuming
less.
A Chinese economist asked a neat question.
Who has invested more, US in China, or China in US?
The US has invested in China less than half of what China has invested in US- The same is the case with us.
We have invested in US over $50 billion.
But the US has invested less than $20 billion in
India.
Why the world is after US?
The secret lies in the American spend, in that they hardly save.
In fact they use their credit cards to spend their future incoihe.
That the US spends is what makes it attractive to export to the US.
So, US imports more than what it exports year after year.
The result.
The world is dependent on US consumption for its growth.
By its deepening culture of consumption, the US has habituated the world to feed on US consumption.
But as the US needs money to finance its consumption, the world provides the money.
It’s like a shopkeeper providing the money to a customer so that the
customer keeps buying from the shop.
The customer will not buy, the shop won’t have business, unless the shopkeeper funds him.
The US is like the lucky customer.
And the world is like the helpless shopkeeper financier.
Who is America’s biggest shopkeeper financier?
Japan.!!!!!!!!
Yet it is Japan which is regarded as weak.
Modern economists complain that Japanese do not spend, so they do not grow.
To force the Japanese to spend, the Japanese government exerted itself. Reduced the savings rates, even charged the savers.
Even then the Japanese did not spend.
Their traditional postal savings alone is over $1.2 billions, that is. Rs.60 lakh crores, about three times the GDP of India.
Thus, savings, far from being the strength of Japan, has become its pain.
What is the lesson?
That is, a nation cannot grow unless the people spend, not save.
Not just spend, but borrow and spend. Dr.Jagdish Bhagwati, the famous Jndain-born economist in the US, told Dr.Manmohan Singh that Indians
wastefully save.
Ask them to spend, he said.
On imported cars and, seriously, even on cosmetics! This, he counseled, will put India on a growth curve. But -like Japanese we too are not obliging.
Modernists may not, but one who has read the Mahabharatha will, know. A Rishi by name Charuvaka gave the same advice when Pandavas were around, happy, if need be by borrowing.
No need to repay, if you cannot, he counseled.
No sin would attach, he assured.
Fortunately his advice was rejected by us thousands of years back. That is why perhaps we are alive as a nation.
Our old companions are in archives today.
Now we have the very same advice.
That is saving as sin, and spending as virtue.
This is central to neo-economics.
Caution!!!!
Before you follow these neo-Charuvakas, get some fools to save so that you can borrow from them and spend, after you exhaust your savings.
This is what US has successfully done in last two decades.
Regards
Sudan
Source: unknown
Showing posts with label Discussions. Show all posts
Showing posts with label Discussions. Show all posts
Saturday, October 10, 2009
Sunday, February 10, 2008
whát íś śtŕíńg théőŕý?
We live in a wonderfully complex universe, and we are curious about it by nature. Time and again we have wondered--- why are we here? Where did we and the world come from? What is the world made of? It is our privilege to live in a time when enormous progress has been made towards finding some of the answers. String theory is our most recent attempt to answer the last (and part of the second) question.
So, what is the world made of? Ordinary matter is made of atoms, which are in turn made of just three basic components: electrons whirling around a nucleus composed of neutrons and protons. The electron is a truly fundamental particle (it is one of a family of particles known as leptons), but neutrons and protons are made of smaller particles, known as quarks. Quarks are, as far as we know, truly elementary.
Our current knowledge about the subatomic composition of the universe is summarized in what is known as the Standard Model of particle physics. It describes both the fundamental building blocks out of which the world is made, and the forces through which these blocks interact. There are twelve basic building blocks. Six of these are quarks--- they go by the interesting names of up, down, charm, strange, bottom and top. (A proton, for instance, is made of two up quarks and one down quark.) The other six are leptons--- these include the electron and its two heavier siblings, the muon and the tauon, as well as three neutrinos.
There are four fundamental forces in the universe: gravity, electromagnetism, and the weak and strong nuclear forces. Each of these is produced by fundamental particles that act as carriers of the force. The most familiar of these is the photon, a particle of light, which is the mediator of electromagnetic forces. (This means that, for instance, a magnet attracts a nail because both objects exchange photons.) The graviton is the particle associated with gravity. The strong force is carried by eight particles known as gluons. Finally, the weak force is transmitted by three particles, the W+, the W- , and the Z.
The behavior of all of these particles and forces is described with impeccable precision by the Standard Model, with one notable exception: gravity. For technical reasons, the gravitational force, the most familiar in our every day lives, has proven very difficult to describe microscopically. This has been for many years one of the most important problems in theoretical physics-- to formulate a quantum theory of gravity.
In the last few decades, string theory has emerged as the most promising candidate for a microscopic theory of gravity. And it is infinitely more ambitious than that: it attempts to provide a complete, unified, and consistent description of the fundamental structure of our universe. (For this reason it is sometimes, quite arrogantly, called a 'Theory of Everything').
The essential idea behind string theory is this: all of the different 'fundamental ' particles of the Standard Model are really just different manifestations of one basic object: a string. How can that be? Well, we would ordinarily picture an electron, for instance, as a point with no internal structure. A point cannot do anything but move. But, if string theory is correct, then under an extremely powerful 'microscope' we would realize that the electron is not really a point, but a tiny loop of string. A string can do something aside from moving--- it can oscillate in different ways. If it oscillates a certain way, then from a distance, unable to tell it is really a string, we see an electron. But if it oscillates some other way, well, then we call it a photon, or a quark, or a ... you get the idea. So, if string theory is correct, the entire world is made of strings!
Perhaps the most remarkable thing about string theory is that such a simple idea works--- it is possible to derive (an extension of) the Standard Model (which has been verified experimentally with incredible precision) from a theory of strings. But it should also be said that, to date, there is no direct experimental evidence that string theory itself is the correct description of Nature. This is mostly due to the fact that string theory is still under development. We know bits and pieces of it, but we do not yet see the whole picture, and we are therefore unable to make definite predictions. In recent years many exciting developments have taken place, radically improving our understanding of what the theory is.
So, what is the world made of? Ordinary matter is made of atoms, which are in turn made of just three basic components: electrons whirling around a nucleus composed of neutrons and protons. The electron is a truly fundamental particle (it is one of a family of particles known as leptons), but neutrons and protons are made of smaller particles, known as quarks. Quarks are, as far as we know, truly elementary.
Our current knowledge about the subatomic composition of the universe is summarized in what is known as the Standard Model of particle physics. It describes both the fundamental building blocks out of which the world is made, and the forces through which these blocks interact. There are twelve basic building blocks. Six of these are quarks--- they go by the interesting names of up, down, charm, strange, bottom and top. (A proton, for instance, is made of two up quarks and one down quark.) The other six are leptons--- these include the electron and its two heavier siblings, the muon and the tauon, as well as three neutrinos.
There are four fundamental forces in the universe: gravity, electromagnetism, and the weak and strong nuclear forces. Each of these is produced by fundamental particles that act as carriers of the force. The most familiar of these is the photon, a particle of light, which is the mediator of electromagnetic forces. (This means that, for instance, a magnet attracts a nail because both objects exchange photons.) The graviton is the particle associated with gravity. The strong force is carried by eight particles known as gluons. Finally, the weak force is transmitted by three particles, the W+, the W- , and the Z.
The behavior of all of these particles and forces is described with impeccable precision by the Standard Model, with one notable exception: gravity. For technical reasons, the gravitational force, the most familiar in our every day lives, has proven very difficult to describe microscopically. This has been for many years one of the most important problems in theoretical physics-- to formulate a quantum theory of gravity.
In the last few decades, string theory has emerged as the most promising candidate for a microscopic theory of gravity. And it is infinitely more ambitious than that: it attempts to provide a complete, unified, and consistent description of the fundamental structure of our universe. (For this reason it is sometimes, quite arrogantly, called a 'Theory of Everything').
The essential idea behind string theory is this: all of the different 'fundamental ' particles of the Standard Model are really just different manifestations of one basic object: a string. How can that be? Well, we would ordinarily picture an electron, for instance, as a point with no internal structure. A point cannot do anything but move. But, if string theory is correct, then under an extremely powerful 'microscope' we would realize that the electron is not really a point, but a tiny loop of string. A string can do something aside from moving--- it can oscillate in different ways. If it oscillates a certain way, then from a distance, unable to tell it is really a string, we see an electron. But if it oscillates some other way, well, then we call it a photon, or a quark, or a ... you get the idea. So, if string theory is correct, the entire world is made of strings!
Perhaps the most remarkable thing about string theory is that such a simple idea works--- it is possible to derive (an extension of) the Standard Model (which has been verified experimentally with incredible precision) from a theory of strings. But it should also be said that, to date, there is no direct experimental evidence that string theory itself is the correct description of Nature. This is mostly due to the fact that string theory is still under development. We know bits and pieces of it, but we do not yet see the whole picture, and we are therefore unable to make definite predictions. In recent years many exciting developments have taken place, radically improving our understanding of what the theory is.
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