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-Action: education is the Thing in People

Thursday, February 3rd, 2011

-Action: education is the Thing in People

The so-called "Employment is the Thing in People", this sentence is wrong at least a half, even said to be ignorant.

Although generally, national income is created by labor, increase employment is to increase the national income, however, to distinguish between two situations: First, under the simple labor employment growth, the second is under complex labor employment growth. The former achievements of the national income growth, even in the period of rapid population growth is very limited because of high population growth rate of 2%, however, only 0.5% in the domestic stage; the latter achievement of the national income growth, even in the population annual growth less than 0.2% even under low employment can still achieve a higher level.

Simple distinction between labor and labor complicated, of course, reflected in the labor efficiency. From 190 since 1820, according to World Bank data, by 2006, world GDP has grown to 66.6 trillion current international dollars, and 1820 of 694.4 billion yuan in 1990, compared to the international increase of up to 94.9 times the cumulative, net 1990 to 2006 international dollars roughly 35% of the depreciation of the existence of factors, the cumulative terms of constant prices should be close to 70 times the actual increase. At the same time, the world's total population growth to 65.2 million, an increase of only 5.26 times total. Considering the average life expectancy of the world's population to this has been extended to nearly 68 years, the corresponding increase of the world's total labor force of 9.6 times, from 4.4 billion to 4.22 billion people. Obviously, this period, growth in the labor force growth on the role of wealth began to lose its place is a rapid increase in labor efficiency. General situation is that labor force growth due to the wealth of contributions to growth of about 14% of total wealth growth, improve labor efficiency due to the wealth of contributions to growth of about 86% of total wealth growth.

Since the complex to enhance work efficiency of labor growth is the main source of income growth, develop skills and complex work is the result of education, on this stage is the result of higher education, therefore, "Employment is the Thing in People "This statement is definitely wrong. Correct to say of course, is: "Education is Basic Thing."

Unfortunately, China's gross enrollment rate of students (enrollment in regular higher education / school-age population) less than 30%, of which only 21.8% in 2006, while the U.S. was 81.8%, Australia 72.7%, Korea 91 %, even more than 47% in Mongolia.

To this end, my suggestion is that as soon as domestic students should be gross enrollment rates to 50%. Generally speaking, this means that the domestic general higher education in the number of students on the basis of the current 20 million to 35 million ~ 40 million. Considering the number of national school-age decreasing year by year, to maintain the scale, 10 years or more after some time domestic students will be able to improve gross enrollment rate to 70%.

As to how the rapid increase in domestic gross enrollment rate of students? The answer of course is to increase funding for higher education investment. However, not increase the population's education investment, or increase the commercialization of educational inputs, but to increase the Government's educational investment. The sustained and rapid economic growth and huge debt the central government and space, the Chinese government can handle. On second thought, since the ability to value the RMB 6 trillion of foreign exchange reserves over to the Americans to spend, they have the ability to run higher education in China.

Incidentally, the last decade the commercialization of higher domestic traveled road is very wrong. This not only increased the parents, especially in rural financial burden on parents, also resulted in the University of heavily indebted, and made even the professors who pay no medical treatment. Think about it, since banks have a problem the government needs assistance, then what the University of liabilities back to teachers and parents own it! This is very unfair.

It is worth mentioning that the Government increase investment to higher education is not the way ticket. The immediate benefits, the investment in education is also a domestic demand, increasing investment in education is to expand domestic demand, thus achieving revenue growth with income growth, not to mention the latter increase is often greater than the former. The long-term benefits, raising the gross enrollment rate of college students can contribute to upgrading of domestic industries, the focus on further enhancing the secondary industry and tertiary industry the proportion of non-agricultural population and the proportion of the total population, in the first industry revenue contribution rate is negative, and the current financial revenue almost entirely from one-third of the total population of non-agricultural population (urban population, which still includes a large number of agricultural population), which will surely become an important revenue promoter of sustainable growth .

Although I am not deputies, but for me, I will "gross enrollment rate of students rapidly increased," the two sessions at this year's proposal.

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There is no asset price bubble in China

Monday, December 20th, 2010

Qing Yi: China's asset price bubble does not exist
[Japanese land price bubble burst in the real reasons (below)]

Fallen leaves will shatter the head? Frankly speaking, only those dissatisfied with a bottle, shake it all day in a half bottle things (children) do (children) of people would be face value. Worse, over-exaggerated the risk of the Chinese economy has become quite common in economic life phenomenon, including academics and decision-making. However, this does nothing to risk control, it touches will be a serious impediment to economic health.

Economists concerned about asset price bubble is actually paying attention to loan quality, and therefore decided to financial security. Loan quality is usually determined by the collateral. As a common collateral, land and stock prices is a measure of asset price bubbles and not. It said the asset price bubble, in fact, talking about the land price bubble and stock price bubble.

Yes, because in Japan most of the land as collateral for loans, while banks have a large number of holdings, land and stock prices rise over after the bubble burst there is indeed cause the Japanese economy since the nineties of the last century into a long-term downturn reasons. Land prices continued to fall by about collateral, banks surge in bad loans, to prevent further deterioration of the capital adequacy ratio, even if the long-term interest rate is zero, it can not prevent long-term loans of negative growth. This is the so-called zero interest rate Japan's economy, zero growth. However, the domestic equity as collateral for loans to be minimal, with a loan pledge of goods in the past, all for the price of equity is far below the market price of the Restricted Shares, and in calculating the value of the collateral Shi You are fully underestimated, no doubt, stock prices will not constitute a domestic asset price bubbles.

As for the land, taking into account the accumulated sales since 1986, commercial property (including commercial residential and commercial buildings) occupied 413 acres of land at best, even if two million yuan per mu according to the weighted average price calculation (previously used for commercial housing development The average land price of less than 100 yuan / mu, or even the year 2000 less than 500,000 yuan / mu), is private land holdings listed total assets total more than 8.3 trillion yuan, however, the corresponding premium rate (total premium on GDP ratio), only 25%, equivalent to only mature market one-seventh of the national average. For base reasons, the smaller base of assets and the land base of civil larger between GDP, even though the two annual growth rate of the same land ratio also decreased year by year. Therefore, there is no evidence that there exists land asset bubbles.

I would like to remind you that the premium rate to talk about aside land asset bubbles is not very professional.

Address the land ratio, the United States most years less than 100%, the UK most years 80% to 200% swing, while Japan rose in 1980 after more than 300%. According to Japanese scholars introduced in Japan in 1990, private land assets 2,400 trillion yen, equivalent to 341.14 trillion yen, then the official GDP statistics of 700%. Although the 1997 devaluation of land assets, to 1,700 trillion yen, but compared with the current GDP ratio as high as 441 percent premium.

Since 1986, total domestic sales of commercial area of 5.5 billion square meters, according to two times the average volume rate of land, occupied land area of commercial housing sold approximately 2.75 billion square meters in about, or about 413 million mu. It is worth noting in this commercial houses occupy 413 mu of land which have so far still in the proportion of multi-state collateral, but Liu Cheng, and mortgage of land replacement cost several times more than the cost of a mortgage or even 10 times. In this case, the private holdings of public land prices on the quality of bank loans is quite positive, where we talk about asset price bubbles!

To a large extent, not only the domestic private holdings of the current asset price of land there is no risk of a bubble, but a longer period of time in the future will not appear. The reason is the future trend of land prices are still rising, first transformation of the old with the relocation compensation costs which continue to promote the existing urban land prices, followed by rising food prices to promote the future of new urban land prices. On the other hand, the next 15 to 20 years as the expected increase in commercial housing land is 3 to 4 times the stock of the Government to increase land supply and land sales revenue growth, can also suppress the risk of domestic land assets price bubble to play an active effect.

From a psychological point of view, the reason that people exaggerate the risk, often due to lack of confidence, complacency or laziness. All these are unhealthy psychological characteristics.

Over-inflated asset price bubble in the domestic land-harm is: If you do not rush in labor costs due to the shortage of labor supply rose sharply prior to accelerate the commercial housing development, then, on the one hand all future construction materials will be accompanied by rising labor costs rise, so developers cost is high; the other hand, the current excess liquidity (the so-called lack of liquidity tightening is only man-made or create a false impression) will as the means of production and the overall rise in consumer prices, the evolution of the flow of depreciation as well as liquidity shortages, so that the purchasing power of existing commercial houses a substantial decline in the whole society. By that time, not only land be cut down, and commodity prices will rise a new retaliatory.

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Japanese land price bubble burst in the real reason for (the)

Tuesday, November 9th, 2010

Qing Yi: Japan land prices bubble burst the real reason (I)

Circulated on the Internet's "property market crash of 2011," due to serious distortion of facts, especially the so-called Japanese property bubble of awareness many mistakes, can only be a staple of jokes.

For example, the jokes which the Japanese property bubble burst in 1991, the time pinch, however, from the streets of Japan Real Estate Institute of Land Price Index shows that average land prices in 1991 rose 10.4% in 1992, began to appear 1.8% decline. Also, the post-war years of Japan's largest premium increase in 1957, respectively, 1961 and 1973, the average increase over the previous year followed by 28.1%, 42.5% and 25.1%. The former are mainly due to surge in demand for industrial land is held hostage, which is mainly Tanaka Cabinet plans to stimulate the transformation of the Japanese archipelago. In contrast, from 1985 to 1991 the average rose only 7.59%.

The reason I will be recognized by the Japanese property bubble to correct for the Japanese land price bubble, because after 1992 the Japanese real estate prices occurred mainly in land prices, not price. The former has nearly 50% decline, while the overall trend of the latter is true not fall. There are two reasons: first, introduced in 1992, the right of the periodic lease is only 50 years of age, significantly reduced compared with the previous, of course, also raised by the relative number of years of lease rates. This is not difficult to understand. In recent years, many domestic land use rights for 50 years of commercial real estate developer in effect been sold to residential projects, although the low price of a percent, for example, is 2 million, but the conversion price for the lease of an average 400 yuan more than 22,000 yuan of 70-year lease of residential projects the price of an average 314 yuan up 27.4%. Second, the right to shorten the lease period on a regular basis, the Japanese quickly to the factory for residential construction, prefabrication, recycled the direction of escalation, with used materials and design shorten life and reduce the construction costs, reducing environmental pollution, which naturally support a rate far lower than the land prices for residential real price in Japan. In fact, it was introduced in Japan real estate sector, even 10 years ago, Japan's high housing prices rise, not fall cases abound.

Some studies say, the Japanese land price bubble burst before the rapid rise is due to speculative factors, and for this reason, in order to prevent a property bubble in China, also need to restrain speculation as a priority. It is also estimated that the domestic central bank repeatedly put restrictions on housing prices a reason for surgery residents purchase loans.

Frankly speaking, this was utter nonsense.

Based on the early years of Japan's Economic Planning Agency, "Economic White Paper" provides data to 1955, the Japanese land price index and bank loan growth index of 100 terms, premium index of 283 in 1960, loan growth index of 256; 1970 years ago by the 1408, which was 1235; 1972 years ago were for the 1845, which was 1927. Not difficult to see, then land prices in Japan and the interdependence of the loan is very close. In fact, the right to say that, because Japanese banks tend to their land as collateral for loans, so that loan growth contributed to rising land prices and the subsequent land price bubble.

It was also said that the Japanese property bubble burst is the laissez-faire outcome of the residents purchase loan growth, so China should restrict loan growth rate of resident buyers.

This is also nonsense.

According to the Japanese, "The Economist" data for 1996, 1980, Japanese domestic financial institutions in total 3.3172 trillion yen loans, personal loans up 95.6% share, developers, lending accounts for only 4.4%. However, the subsequent reversal of the situation greatly. By 1991, the proportion of personal loans shrunk to 21.6%, the proportion of developer loans increased to 78.4%.

We must understand that the Japanese land price bubble in the direct destruction aimed at domestic financial institutions, thus emerged the so-called housing experts, namely, a large number of domestic financial institutions write off bad debts of the loss.

Sino-Japanese real estate market has many features of nature are not comparable. One of the points of land to private ownership in Japan, mainly Foundation owned the land for the public and the Chinese government to take strict monopoly. This effectively ruled out a similar Japanese living in China as the land price bubble special issue of the risk.

More than just talk about the Japanese land price bubble in part, a more profound reason for another paper.

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Debt risk is overestimated

Tuesday, September 7th, 2010

-Action: a beautiful 15 newsletter

Domestic revenues to the GDP ratio is 20% or 40% or more? This is obviously a big problem. From the state bureau of statistics, in 1978 and 2009, fiscal revenue ratio of the GDP were 31.1% and 20.4%. Intuitively, this ratio is significantly decreased. However, always look at the issue directly, I am afraid that many problems can makes mistakes. A stone and a piece of jade of the blocks containing, visually see all the stone, but they are essentially different.

According to World Bank statistics, in 2006 the central government revenue on the world average GDP ratio is 26.9%, 27.3% developed countries. However, the same countries, the United States is only 19.3%, while France and Britain but were as high as 43.0% and 38.8%. Central Plains from the United States were less state-owned enterprises, while French and British are more state-owned enterprises.

Precisely, not only to revenue including government tax and other benefits imposed by the Government of alienation, but also should include government ownership of property assets, income, and sales of goods and services revenue.

China's fiscal revenue of the reason why the ratio of GDP substantially below the world average, due to domestic revenue statistics do not align with international scope, limited to the loss of tax revenue and subsidies to state-owned enterprises. This is very unscientific. Since the loss of subsidies to state-owned enterprises can be included in financial income, then, why the income available for distribution of state-owned enterprises can not be regarded as financial income? Preliminary estimates, if calculated in accordance with international practice on domestic revenue ratio of GDP, probably has more than 40%. No wonder, after all, China is a country with the highest proportion of state assets.

As of the end of 2009, only the scale domestic state-owned and state holding enterprises as much as 20.7 trillion total assets, equity assets totaled 8 trillion, respectively, the total sum of above-scale enterprises, 44% and 42%. This does not include the unfinished transformation of the Ministry of Railways and other departments into enterprises owned by state-owned assets, nor will the state-owned shares and the market value of the difference between the book value included. For example, in the oil inside and outside by the weighted average total stock of about 1.7 trillion total market capitalization, government share of 86% or higher. Conservative estimates, the current government in the hands of listed equity of not less than 13.5 trillion total market capitalization.

I note that, in assessing the risk of sovereign debt, people often neglect the state-owned assets held by the Government on sovereign debt repayment capacity of the positive effect. In fact, with the company can sell assets to repay debt in the case, the government can also, through the sale of state assets to repay the sovereign debt financing, especially domestic debt. Needless to say, the government-owned state-owned assets into account, the Chinese government (including local government) the solvency of the unparalleled.

From this point of view, the so-called debt surged to 7.38 trillion places may drag down China's economic argument is a serious risk of domestic sovereign debt overestimated.

Asia-Pacific stock markets generally rose today, the Nikkei rose 3.24%, ASX ordinary shares rose 2.33%, the Hang Seng Index rose 1.62%, but only A shares may drop further. To the closing stock index reported 2552.66 points, down 0.73%. Unit 3, 9, or a beautiful rose, up 2.27% Hefei Urban Construction, Tianshan shares rose 1.93%. To close in the third period of a beautiful 15 (reduced version) growth with an average cumulative increase from yesterday's -14.72% to -15.68%, a beautiful combination of 15 cumulative average growth of 28.98 percent gain from yesterday fell to 27.53 percent. Today, 15 blue-chip portfolio continues to plumb pretty average cumulative gain of -3.27% from yesterday and then to -3.48%.

The third phase of "beautiful 15" (reduced version) Growth Portfolio Presentation
Code
Referred to as March 4 June 3 cumulative increase the dynamic price-earnings ratio
09 per share

Close (yuan) close (yuan) (%)
(Times)
Income (yuan)
000 528 Liugong 21.5718.76-13.037.8
239 (10 expected)
000 550 JMC 18.57-16.208.1
228 (10 expected)
600 449 horse industry 35.2322.32-36.64
9.8
2.28
000 961 Central Building 19.358.40-34.88
5.8
1.45 (10 expected)
600 742 FAW-rich-dimensional
26.9217.32-35.6610.3
1.68
002 208 20.25 Hefei Urban Construction
-24.0715.0
1.35 (10 expected)
000 338 Weichai Power 57.48
-5.967.77.50 (10 expected)
600 166 FOTON 17.57-12.637.8
2.26 (10 expected)
000,877 Shares 20.55-3.2018.3 Tianshan
1.12
000 708 Daye Special Steel
11.55-8.55
9.0
1.28 (10 expected)
600 089 TBEA
16.94-0.4116.9
1.00 (10 expected)
600 197
Yilite
15.223.0529.8
0.51 (10 expected)
(Which, due to short-listed at different times, JMC, Hefei Urban Construction, Weichai Power, Futian Automobile, Tianshan shares, Daye Special Steel, TBEA and Yilite benchmark prices were 22.16 yuan, 26.67 yuan, 61.12 yuan , 20.11 yuan, 21.23 yuan, 12.63 yuan, 17.01 yuan and 14.77 yuan)
The third phase of "beautiful 15" average -15.6812.2
"Beautiful 15" growing portfolio 51.2427.53
Pretty index of 15 leading
304.74%
The Shanghai Composite Index (September 1 2009 2683.72) 2552.66-4.88

15 beautiful blue-chip portfolio presentation
Code
Abbreviation
May 7
June 3
Total increase (%)
601398 Industrial and Commercial Bank of China
4.39
4.22
-0.47
601 857 Oil 11.04
10.62-2.66
600,028 Sinopec
9.018.39-6.88
600019 Baoshan Iron & Steel
6.43
6.28-2.33
600,050 China Unicom
5.35
5.08-5.05
15 beautiful blue-chip portfolio -3.48

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In the first quarter to the good macro-economic trend is clearly

Sunday, August 29th, 2010

-Action: in the first quarter to the good macro-economic trend is clearly

Just released the first quarter, according to macroeconomic data, GDP growth rate by 11.9%, better than expected; CPI rose 2.2%, lower than expected, said the resumption of China's economy is to develop in the direction of growth and low inflation.

The reason is the recovery of GDP rise, but can not understand for the growth of overheating, a very good reason, because the rate of increase over the same period last year by the financial crisis was only 6.1%.

The reason is the low inflation, it is not complicated, because the urban-rural income growth over the same period were 7.5% and 9.2%, while the CPI increase of only 2.1% in urban and rural growth rate of 2.4% in urban income growth is the consumer price increase of 3.57 times the income of rural residents is the increase in consumer price inflation of 3.83 times. Ye Hao inflation, deflation worth mentioning, are reflected in the relationship between prices and income. Determine inflation, must not only look at price increases at the expense of revenue growth.

In fact, due to rising incomes Engel coefficient, while the existing statistical methods in food prices, CPI, or the proportion of established many years ago, which determines the CPI there is the possibility of overestimation of consumer price increases. This means that, once adjusted CPI statistical methods next year, because of agricultural and food prices caused by inflation is expected to be relieved.

For an increase in interest rates were at least made three mistakes: First, ignore the relationship between prices and income, the second is to ignore the current rapid economic growth but recovery of the three is to ignore the nature of the interest rate. The nature of the interest rate is the average profit margin of the whole society, engulfed in the raw material price increases where corporate profits, interest rates can only inhibit the capacity utilization, thereby increasing pressure on the employment market.

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