A very compelling argument about the environment

The great fall of China

from : los angeles times

Revised GDP calculations show that Beijing isn’t the giant we thought it was.

By Walter Russell Mead
December 30, 2007

The most important story to come out of Washington recently had nothing to do with the endless presidential campaign. And although the media largely ignored it, the story changes the world.

The story’s unlikely source was the staid World Bank, which published updated statistics on the economic output of 146 countries. China’s economy, said the bank, is smaller than it thought.

About 40% smaller.

China, it turns out, isn’t a $10-trillion economy on the brink of catching up with the United States. It is a $6-trillion economy, less than half our size. For the foreseeable future, China will have far less money to spend on its military and will face much deeper social and economic problems at home than experts previously believed.

What happened to $4 trillion in Chinese gross domestic product?

Statistics. When economists calculate a country’s gross domestic product, they add up the prices of the goods and services its economy produces and get a total — in dollars for the United States, euros for such countries as Germany and France and yuan for China. To compare countries’ GDP, they typically convert each country’s product into dollars.

The simplest way to do this is to use exchange rates. In 2006, the World Bank calculated that China produced 21 trillion yuan worth of goods and services. Using the market exchange rate of 7.8 yuan to the dollar, the bank pegged China’s GDP at $2.7 trillion.

That number is too low. For one thing, like many countries, China artificially manipulates the value of its currency. For another, many goods in less developed economies such as China and Mexico are much cheaper than they are in countries such as the United States.

To take these factors into account, economists compare prices from one economy to another and compute an adjusted GDP figure based on “purchasing-power parity.” The idea is that a country’s GDP adjusted for purchasing-power parity provides a more realistic measure of relative economic strength and of living standards than the unadjusted GDP numbers.

Unfortunately, comparing hundreds and even thousands of prices in almost 150 economies all over the world is a difficult thing to do. Concerned that its purchasing-power-parity numbers were out of whack, the World Bank went back to the drawing board and, with help from such countries as India and China, reviewed the data behind its GDP adjustments.

It learned that there is less difference between China’s domestic prices and those in such countries as the United States than previously thought. So the new purchasing-power-parity adjustment is smaller than the old one — and $4 trillion in Chinese GDP melts into air.

The political consequences will be felt far and wide. To begin with, the U.S. will remain the world’s largest economy well into the future. Given that fact, fears that China will challenge the U.S. for global political leadership seem overblown. Under the old figures, China was predicted to pass the United States as the world’s largest economy in 2012. That isn’t going to happen.

Also, the difference in U.S. and Chinese living standards is much larger than previously thought. Average income per Chinese is less than one-tenth the U.S. level. With its people this poor, China will have a hard time raising enough revenue for the vast military buildup needed to challenge the United States.

The balance of power in Asia looks more secure. Japan’s economy was not affected by the World Bank revisions. China’s economy has shrunk by 40% compared with Japan too. And although India’s economy was downgraded by 40%, the United States, Japan and India will be more than capable of balancing China’s military power in Asia for a very long time to come.

But don’t pop the champagne corks. It is bad news that billions of people are significantly poorer than we thought. China and India are not the only countries whose GDP has been revised downward. The World Bank figures show sub-Saharan Africa’s economy to be 25% smaller. One consequence is that the ambitious campaign to reduce world poverty by 2015 through the United Nations Millennium Development Goals will surely fail. We have underestimated the size of the world’s poverty problem, and we have overestimated our progress in attacking it. This is not good.

There is more bad news. U.S. businesses and entrepreneurs hoping to crack the Chinese and Indian markets must come to terms with a middle class that is significantly smaller than thought. Investors in overseas stocks should take note. Companies with growth plans tied to the Indian and Chinese markets could face disappointing results, and the high prices of many emerging-market stocks depend on buzz and psychology. Investor sentiment on China and India may now be significantly more vulnerable to future bad news.

China’s political stability may be more fragile than thought. The country faces huge domestic challenges — an aging population lacking any form of social security, wholesale problems in the financial system that dwarf those revealed in the U.S. sub-prime loan mess and the breakdown of its health system. These problems are as big as ever, but China has fewer resources to meet them than we thought.

And there is the environment. With poor air quality, acute water shortages, massive pollution in major watersheds and many other environmental problems, China needs to make enormous investments in the environment to avoid major disasters. Globally, it will be much harder to get China — and India — to make any sacrifices to address problems such as global warming.

For Americans, the new numbers from the World Bank bring good news and bad. On the plus side, U.S. leadership in the global system seems more secure and more likely to endure through the next generation. On the other hand, the world we are called on to lead is poorer and more troubled than we anticipated.

Maybe the old Chinese curse says it best: We seem to be headed for interesting times.

Walter Russell Mead, a senior fellow at the Council on Foreign Relations, is the author of “God and Gold: Britain, America and the Making of the Modern World.”

The Legend of Cliff Young: The 61 Year Old Farmer Who Won the World’s Toughest Race

Those who are in the ultra world already know about the legendary Cliff Young but those outside may not have heard the story.

The whole nation thought he was a crazy old man to undertake an almost impossible feat. Most feared that he would die trying. But this humble old man proved all the critics wrong.Cliff Young, at 61 years of age, participated in 1983’s Sydney to Melbourne race. Considered to be the world’s toughest race, with the distance of 875 (543.7 m) kilometers and took at least 5 days to finish, Cliff Young entered the race against world-class athletes. Read how he achieved the unthinkable and inspires the whole nation.

The Beginning

Every year, Australia hosts an 875-kilometer endurance racing from Sydney to Melbourne – considered to be the world’s longest and toughest ultra-marathon. It’s a long, tough race that takes five days and normally participated by world-class athletes who train specially for the event. Backed by big names in sports like Nike, these athletes are mostly less than 30 years old men and women equipped with the most expensive sponsored training outfits and shoes.

In 1983, these top class runners were in for a surprise. On the day of the race, a guy named Cliff Young showed up. At first, no one cared about him since everybody thought he was there to watch the event. After all, he was 61 years old, showed up in overalls and galoshes over his work boots.

As Cliff walked up to the table to take his number, it became obvious to everybody he was going to run. He was going to join a group of 150 world-class athletes and run! During that time, these runners don’t even know another surprising fact – his only trainer was his 81-year-old mother, Neville Wran.

Everybody thought that it was a crazy publicity stunt. But the press was curious, so as he took his number 64 and moved into the pack of runners in their special, expensive racing outfit, the camera focused on him and reporters started to ask:

“Who are you and what are you doing?”

“I’m Cliff Young. I’m from a large ranch where we run sheep outside of Melbourne.”

They said, “You’re really going to run in this race?”

“Yeah,” Cliff nodded.

“Got any backers?”

“No.”

“Then you can’t run.”

“Yeah I can.” Cliff said. “See, I grew up on a farm where we couldn’t afford horses or four wheel drives, and the whole time I was growing up– until about four years ago when we finally made some money and got a four wheeler– whenever the storms would roll in, I’d have to go out and round up the sheep. We had 2,000 head, and we have 2,000 acres. Sometimes I would have to run those sheep for two or three days. It took a long time, but I’d catch them. I believe I can run this race; it’s only two more days. Five days. I’ve run sheep for three.”

When the marathon started, the pros left Cliff behind in his galoshes. The crowds smiled because he didn’t even run correctly. Instead of running, he appeared to run leisurely, shuffling like an amateur.

Now, the 61-year-old potato farmer from Beech Forest with no teeth had started the ultra-tough race with world-class athletes. All over Australia, people who watched the live telecast kept on praying that someone would stop this crazy old man from running because everyone believed he’ll die even before even getting halfway across Sydney.

Turtle vs rabbits
Every professional athlete knew for certain that it took about 5 days to finish this race, and that in order to compete, you would need to run 18 hours and sleep 6 hours. The thing is, old Cliff Young did not know that!

When the morning news of the race was aired, people were in for another big surprise. Cliff was still in the race and had jogged all night down to a city called Mittagong.

Apparently, Cliff did not stop after the first day. Although he was still far behind the world-class athletes, he kept on running. He even had the time to wave to spectators who watched the event by the highways.

When he got to a town called Albury he was asked about his tactics for the rest of the race. He said he would run through to the finish, and he did.

He kept running. Every night he got just a little bit closer to the leading pack. By the last night, he passed all of the world-class athletes. By the last day, he was way in front of them. Not only did he run the Melbourne to Sydney race at age 61, without dying; he won first place, breaking the race record by 9 hours and became a national hero! The nation fell in love with the 61-year-old potato farmer who came out of nowhere to defeat the world’s best long distance runners.

He finished the 875-kilometre race in 5 days, 15 hours and 4 minutes. Not knowing that he was supposed to sleep during the race, he said when running throughout the race, he imagined that he was chasing sheep and trying to outrun a storm.

When Cliff was awarded the first prize of $10,000, he said he did not know there was a prize and insisted that he had not entered for the money. He said, “There’re five other runners still out there doing it tougher than me,” and he gave them $2,000 each. He did not keep a single cent for himself. That act endeared him to all of Australia. Cliff was a humble, average man, who undertook an extraordinary feat and became a national sensation.

The Inspirational Run Continues
In the following year, Cliff Young entered the same race and won the 7 th place. During the race, his hip popped out of the joint socket, his knee played up and he endured shin splints. But those didn’t deter him from finishing the race. When he was announced as the winner for most courageous runner and presented with a Mitsubishi Colt, he said, “I didn’t do it near as tough as old Bob McIlwaine. Here, Bob, you have the car,” and gave the keys to him.

It was said that Cliff Young never kept a single prize. People gave him watches, because he never had one. He would thank them because he did not want to hurt their feelings, but will then give it away to the first child he saw. He did not understand why he would need a watch because, he said, he knew when it was daylight, when it was dark, and when he was hungry.

Cliff came to prominence again in 1997, aged 76, when he attempted to become the oldest man to run around Australia and raise money for homeless children. He managed to completed 6,520km of the 16,000km run before he had to pull out after his only permanent crew member became ill.

His love for running never diminished but in year 2000, after collapsing in his Gellibrand home a week after completing 921 kilometers of a 1600-kilometre race, his lose his strength for running. The mild stroke ended his heroic running days.

After the long illness, Cliff Young, the running legend passed away on 2 nd November 2003. He was 81.

Current Race

The “Young-shuffle” has been adopted by ultra-marathon runners because it is considered more aerodynamic and expends less energy. At least 3 winners of the Sydney to Melbourne race have been known to use the ‘Young-shuffle’ to win the race.

Now, for Sydney to Melbourne race, almost nobody sleeps. To win that race, you have to run like Cliff Young did, you have to run all night as well as all day.

How To Get Out of Debt (Study loan, Credit Cards after your new job)

from :getrichslowly

Nick writes with a common question:

I am a NTU student with $15,000 of debt. What is the first step in paying this off?

Debt elimination involves three steps:

1. Stop acquiring new debt.
2. Establish an emergency fund.
3. Implement a debt snowball.

Here’s how to approach each step. (I’ll use Nick’s situation as an example, but the principles apply to everyone.)

Stop acquiring new debt

(This step can be accomplished in an afternoon.)

This may seem self-evident, but the reason your debt is out of control is that you keep adding to it. Stop using credit. Don’t finance anything. Cut up your credit cards.

That last one can be tough. Don’t make excuses. I don’t care that other personal finance sites say that you shouldn’t cut them up. Destroy them. Stop rationalizing that you need them.

• You don’t need credit cards for a safety net.
• You don’t need credit cards for convenience.
• You don’t need credit cards for cash-back bonuses.

You don’t need credit cards at all. If you’re in debt, credit cards are a trap. They only put you deeper in debt. Later, when your debts are gone and your finances are under control, maybe then you can get a credit card. (I don’t carry a personal credit card. I don’t miss having one.)

After you destroy your cards, halt any recurring payments. If you have a gym membership, cancel it. If you automatically renew your World of Warcraft account, cancel it. Cancel anything that automatically charges your credit card. Stop using credit.

Once you’ve done this, call each credit card company in turn. Do not cancel your credit cards (except for those with a zero balance). Instead, ask for a better deal. Find an offer online and use it as a bargaining wedge. Your bank may not agree to match competing offers, but it probably will. It never hurts to ask.

Establish an emergency fund

(This step will probably take several months.)

For some, this is counter-intuitive. Why save before paying off debt? Because if you don’t save first, you’re not going to be able to cope with unexpected expenses. Do not tell yourself that you can keep a credit card for emergencies. Destroy your credit cards; save cash for emergencies.

How much should you save? Ideally, you’d save $1,000 to start. (College students may be able to get by with $500.) This money is for emergencies only. It is not for beer. It is not for shoes. It is not for a Playstation 3. It is to be used when your car dies, or when you break your arm in a touch football game.

Keep this money liquid, but not immediately accessible. Don’t tie your emergency fund to a debit card. Don’t sabotage your efforts by making it easy to spend the money on non-essentials. Consider opening a savings account at an online bank like ING or StandChart. When an emergency arises, you can easily transfer the money to your regular checking account. It’ll be there when you need it, but you won’t be able to spend it spontaneously.

Implement a debt snowball

(This step may require several years.)

After you’ve stopped using credit, and after you’ve saved an emergency fund, then attack your existing debt. Attack it with vigor. Throw whatever you can at it.

Many people say to pay your high interest debts first. There’s no question that this makes the most sense mathematically. But if money were all about math, you wouldn’t have debt in the first place. Money is as much about emotion and psychology as it is about math.

There are at least two approaches to debt elimination. Psychologically, using a debt snowball offers big payoffs, payoffs that can spur you to further debt reduction. Here’s the short version:

1. Order your debts from lowest balance to highest balance.
2. Designate a certain amount of money to pay toward debts each month.
3. Pay the minimum payment on all debts except for the one with the lowest balance.
4. Throw every other penny at the debt with the lowest balance.
5. When that debt is gone, do not alter the monthly amount used to pay debts, but throw all you can at the debt with the next-lowest balance.

I’m a huge fan of the debt snowball. It still takes time to pay off your debts, but you can see results almost immediately.

Supplementary solutions

You can do other things to improve your money situation while you’re working on these three steps.

First, focus on the fundamental personal finance equation: to pay off debt, or to save money, or to accumulate wealth, you must spend less than you earn.

Curb your spending. Re-learn frugal habits. (Frugality is something with which most college students are all too familiar.) You can find some great ideas in the archives of this site. Also check Frugal for Life.

While you work to spend less, do what you can to increase your income. If possible, sell some of the stuff you bought when you got into debt. Get an extra job. (But don’t neglect your studies for the sake of earning more. Your studies are most important.)

Finally, go to your local public library and borrow Dave Ramsey’s The Total Money Makeover. Don’t be put off by the title — this is a fantastic guide to getting out of debt and developing good money habits. I rave about it often, but that’s because it has done so much to help my own personal finances. After you’ve finished, return it and borrow another book about money.

The most important thing is to start now. Don’t start tomorrow. Don’t start next week. Start tackling your debt now. Your older self will thank you.

10 Foolproof Tips for Better Sleep

There was a period in my life when I had a lot of problems with sleep. It took me very long to fall asleep, I was easily awaken, and I simply wasn’t getting enough of rest at night. I didn’t want to take medication and this led me to learn several tips and tricks that really helped me to overcome my insomnia. Some of these tips I try to follow regularly.

1. Don’t worry about not getting enough sleep. Try not to worry about how much you sleep. Such worrying can start a cycle of negative thoughts that contribute to a condition, known as “learned insomnia”. Learned insomnia occurs when you worry so much about whether or not you will be able to get adequate sleep, that the bedtime rituals and behavior actually trigger insomnia.
2. Don’t force yourself to sleep. The very attempt of trying to do so actually awakes you, making it more difficult to sleep.
3. Go to bed only when you are feeling really tired and sleepy.
4. Don’t look at the alarm clock at night. Looking at the clock promotes increased anxiety and obsession about time.
5. Body-heating procedures. Some studies suggest that soaking in hot water before going to bed can ease the transition into a deeper sleep.
6. Avoid oversleep. Don’t oversleep to make up for a poor night’s sleep. Doing so for even a couple of days can reset your body clock and make it harder for you to sleep at night.
7. Sex. Sex is a well-known nighttime stress reliever. Healthy sex life enhances your relationship, relaxes your body, releases ‘happy’ chemicals, and even promotes wellness. And it welcomes sleep.
8. Avoid alcohol as a sleeping aid. Avoid the use of alcohol in the late evening. The most common myth found among people is that they believe alcohol helps in the sleep. But the fact is alcohol may initially act as sedative, but it produces a number of sleep-impairing effects in the long run.
9. Associate your bed and bedroom with sleep and sex only. Don’t watch TV, eat, or read in bed. Although these things help some people sleep, they can also give your brain the idea that bed isn’t just for sleeping – and this can keep you awake.
10. Naps. If you suffer from insomnia, try not taking a nap. If the goal is to sleep more during the night, napping may steal hours desired later on. If you’re a regular napper, and experiencing difficulty falling or staying asleep at night, give up the nap and see what happens.

Written by C. Simmons of HealthAssist.net