"China could buy all of the outstanding sovereign debt of Spain, Ireland, Portugal and Greece, solving the euro area’s debt crisis in a trice. And it would still have almost half of its reserves left over."
Or the following:
"China could gobble up Apple, Microsoft, IBM and Google for less than $1 trillion. It could also follow the lead of those sheikhs and oligarchs who like to buy English football clubs. According to Forbes magazine, the 50 most valuable sports franchises around the world were worth only $50.4 billion last year, less than 2% of China’s reserves. "
The article also mentioned that China's entire foreign reserves can by "about 88% of this year’s global oil supply". This shopping item really attracted my attention: 60 years worth of Chinese accumulation of wealth is only equivalent to 10 months of global oil supply!
Surely China is not going to buy any of the above-mentioned fantasy items. Instead, I would propose that China does the following: to invest a substantial proportion of its foreign reserves to fund all kinds of new energy projects around the world. Energy storage (battery), electric cars, smart grid, new generation nuclear technology (thorium), energy conservation, bio-fuels... The possibility is endless, and the world is not in lack of ideas. There are so many wonderful entrepreneurs and brilliant projects, but not enough support from government and investors. The risk is usually too high for most private investors, and the U.S. government is not taking advantage of America's dynamic innovation machine. China's $3 trillion foreign reserves could meet the gap.
China has been America's generous lender for years. Why not become the global venture capitalist? Instead of earning pitiful return on U.S treasuries, China should have the vision and courage to invest its money in the future of world energy. China should set up a venture capital fund, go find the most promising ideas in the new energy industry, fund them, nurture them, and believe in them. The projects could come from anywhere and anyone, as long as it has the potential. Even if 90% of the projects fail, as long as we have a few technological breakthroughs, we will revolutionize our energy future and solve many of our most urgent problems like foreign oil reliance, pollution, and economic recession.
In this way, China's huge foreign reserves would not be blamed to cause global imbalance; instead, it is doing the whole world a service by investing in the future at a time when nobody want to take on the risk. If we combines the capital from China and the innovation from around the world, we will have a much better chance to find solutions to our common challenges!
Everyday, as soon as we open our eyes in the morning, we are in debt: there are homework and deadlines, and there are preparation for summer.There are always things to do, one after another. Read New York Times, reply to emails, and prepare for interviews. Our daily routine has so dominated our lives that we don't even have time to sit down and ponder over the purpose of all these.
Pondering won't necessarily render realization. We might still be very confused after all those pondering. But it's better than living a mindless life.
There are so many wonderful people around us, and I will be very glad to spend the whole weekend with anyone of them, listening to their stories, going into their world. But the calendar reminds us of the six deadlines before the end of next week, and we have to say, "it's such a joy to spend time with you, but I need to go back to my work".
It's always nice to see people hanging out on the lawn, playing music and Hula-hoop. At least someone is enjoying life. Can I afford such luxury? What am I missing? What am I doing? What's worth what? It's so easy to fall into such self-pitying state of mind.
I need to remind myself of the choice that I have made. To sacrifice is to gain. We can't have the best of everything. I am optimizing my time and utility, and I am very happy with it. I am not just paddling in a little lake; I am going to sail across the oceans and around the globe. It is then natural that I will spend more time building my ship and learning about the voyage. This is the choice, and I embrace the pains and gains.
I am glad to have conquered procrastination. I don't waste time because the stakes are too high. The opportunity cost shows me the bottom-line. If I have sacrificed rock climbing, how could I then waste time on facebook? I could have been playing flute, so there's no reason to stare into the flashing screen with a blank mind.
One of the most beneficial thing I have learned to do is to close my computer as often as I could, and as soon as I am done using it. Once I close the lid of my computer, I open up endless possibilities. I can read a book, play music, go talk to people, go running or swimming, or just close my eyes, take a deep breath and relax. Computer sucks me into this little black box; it hurts my eyes, and restrain my thinking.
Always remember: I am the master of my life, not my scheduler, not my computer, not anything else. I need to be aware of what I am doing. Make the choice, and then make the most out of it. Never waste time, but leave enough room for self-reflection. My schedule is busy, but my life is happy.
While reading Paul Kennedy’s book, what struck me most is the cyclical characteristics of the rise and fall of great powers. There seems to be a chronic disease that all major powers are bound to catch: what makes you is what breaks you. A certain quality would turn out to be both the strength and the weakness of a nation.
When Strength Becomes Weakness
The ancient Chinese empire became a great power largely thanks to the Confucian culture. It taught people to value learning, to respect knowledge (and hence to respect the elderly), and to use their talent to serve the state. These qualities enabled China to become the most sophisticated and prosperous society in the globe for a long time. But, as Kennedy points out in the first Chapter of his book, the same Confucian culture also planted the seed of the empire’s eventual decline. For example, the backward-looking characteristic of the national leaders is derived from the respect for the past and ancestor worship. The value of learning placed on particular fields of knowledge crowded out innovation in commerce and technology. The prosperity and the Central Kingdom mentality also made the empire conceited and self-righteous. Confucianism, it seems, has exhausted its momentum after two millennia, and has become the obstacle of any further progress in the Chinese society.
Fast forward to today’s United States, we also see a similar phenomenon: those qualities that once made America great are causing today’s decline. Democracy is getting messier and is tied up in bipartisan struggles. Property rights, land ownership, and state autonomy make it hard for the federal government to carry out any major infrastructure projects like high-speed rail or wind turbine installation. Even free speech is being used to protect the unlimited corporate donation to political candidates. Some of America’s most distinct greatness seems to stand in the way of the future of this country. It makes people wonder if these past greatness could shine once again and solve the problems of its own making.
When Weakness Becomes Strength
Japan is probably the best example of how one’s weakness could turn into strength. Japan has extremely limited natural resources. It heavily relies on imports for almost all commodities that are vital to Japanese economy. As a result, Japan has developed a deep sense of crisis and alarm. This vigilance and restlessness have made Japan the expert in energy saving and resources management. Among all industrial nations, Japan has the highest energy efficiency, and it separates trash into eight categories for recycling. Japan also developed “urban mining”, extracting precious materials out of waste electronics and other urban garbage. In turn, Japan is exporting its recycling technologies and hybrid cars, and leading the world in energy saving efforts.
China’s authoritarian government is another example of weakness turning into strength. Chinese government has been constantly criticized by the West for its heavy-handed rule and lack of respect for human rights. But recently, many western countries have been quite jealous of the fact that Chinese government can build a high-speed rail across anybody’s backyard. Chinese citizens do not enjoy as many rights as Americans do, but this lack of right has turned into one of the biggest bonuses that history has given the Chinese government: the government can afford to push forward unpopular construction projects and social programs that are indeed necessary for the long term wellbeing of the nation.
So what is the logic behind this alternation of strength and weakness in exactly the same quality? There’s an old Chinese saying: “a proud army is bound to lose”. And we can also say that a winning army is bound to be proud. Success leads to pride, and pride leads to defeat. Defeat will prepare you for another success. An English saying goes like this: “eternal vigilance is the price of liberty”. And observing today’s America, we can also say that too much liberty takes away people’s vigilance. Too much prosperity undermines a nation’s work ethic. And this loss of vigilance and work ethic will in turn destroy the liberty and prosperity. It seems that history is quite fair: no nation could stay at the top forever; no single quality could propel a society for a long time. And, no one will really learn this lesson from history.