British Prime Minister in his speech (Labour Party Conference) said, -
"................... We abandoned the ridiculous, self-imposed dilemma between principle and power.
We went back to first principles, to our values, our real values, those that are timeless, and separated them from doctrine and dogma that had been ravaged by time.
In doing so, we freed Britain at long last from the reactionary choice that dominated British politics for so long: between individual prosperity and a caring society.
We proved that economic efficiency and social justice are not opposites but partners in progress.
We defied conventional political wisdom and so changed it.
Around that we built a new political coalition......"
I'm hoping one day, all of our politician has this foresight and vision....
Wednesday, September 27, 2006
Monday, September 25, 2006
Water and Diamond Paradox
"Water and Diamond Paradox" - Adam Smith 1723-1790
This simple economic situation come to strike me recently.
Solve this problem then you will know why we are where we are?!
This simple economic question is "Water and Diamond Paradox"; Why diamond is more expensive than water, while without water we can not live, but without a diamond we will not die?
Some economists suggest that its because there are two type of 'VALUE', one is known as 'value in use' while the other one known as 'value in exchange'. In this case water is obviuosly high in its 'value in use' than its 'value in exchange'. Unfortunately, this reasoning is less convincing.
Forgeting the above reasoning, we may argue that it is because of differents "Subjective Valuation of individual' that lead to this
conclusion that diamond is more valuable than water.
So far, the given reasons seem merely pointing to worthless fact, just like saying the sun rises from the east.
I'll rather suggest that there is no such thing as subjective valuation, but rather it's the basic principle of demand and supply. In this case the 'Demand' is definately subjective! Since the "demand'is subjective, we therefore can never 'Fix A Price' for a certain commodity, the action of control a fix price on a certain goods will bound to create more problems.
Mind you, this is known in 18 century!!!!!!!!!
This simple economic situation come to strike me recently.
Solve this problem then you will know why we are where we are?!
This simple economic question is "Water and Diamond Paradox"; Why diamond is more expensive than water, while without water we can not live, but without a diamond we will not die?
Some economists suggest that its because there are two type of 'VALUE', one is known as 'value in use' while the other one known as 'value in exchange'. In this case water is obviuosly high in its 'value in use' than its 'value in exchange'. Unfortunately, this reasoning is less convincing.
Forgeting the above reasoning, we may argue that it is because of differents "Subjective Valuation of individual' that lead to this
conclusion that diamond is more valuable than water.
So far, the given reasons seem merely pointing to worthless fact, just like saying the sun rises from the east.
I'll rather suggest that there is no such thing as subjective valuation, but rather it's the basic principle of demand and supply. In this case the 'Demand' is definately subjective! Since the "demand'is subjective, we therefore can never 'Fix A Price' for a certain commodity, the action of control a fix price on a certain goods will bound to create more problems.
Mind you, this is known in 18 century!!!!!!!!!
Sending Sugar By Navy Ship
"I am sending my 'battleships' to Sabah and Sarawak......" said Minister Datuk Seri Shafie Apdal, in The Star 25th Sep 2006
I just wonder what had happened to Malaysia's state of economy nowaday? Using a navy ship to distribute sugar? This is not even happened in the poorest country like Bangladesh nor does it happen to the most populated country like India or China.
Here in Malaysia, we yet again blaming and pointing finger to each other, but refuse anf deny the basic principle of the Free Economy!
Malaysia was blessed by its large pool of natural resources, but wake up man!!! We can no longer depand on it any more, it's especially so in this globalisational of economy.
The sooner we synergIse into the track of global economy the easier we can survive or even excel, if lucky.
Of course to bite the bullet is never easy, but beware of the consequence of not doing it, we are heading to disasterous end economically and hence politically.
I just wonder what had happened to Malaysia's state of economy nowaday? Using a navy ship to distribute sugar? This is not even happened in the poorest country like Bangladesh nor does it happen to the most populated country like India or China.
Here in Malaysia, we yet again blaming and pointing finger to each other, but refuse anf deny the basic principle of the Free Economy!
Malaysia was blessed by its large pool of natural resources, but wake up man!!! We can no longer depand on it any more, it's especially so in this globalisational of economy.
The sooner we synergIse into the track of global economy the easier we can survive or even excel, if lucky.
Of course to bite the bullet is never easy, but beware of the consequence of not doing it, we are heading to disasterous end economically and hence politically.
Tuesday, September 19, 2006
State of Malaysia Economy
Just get a news about Government promoting agriculture industry in Kelantan by giving out RM90M, planning to create another 1000 successful agriculture entrepreneurs in 5 year time.RM90M to create 1000 new enterpreneurs?
By simple calculation of 90M divided by 1000 person, its like each person can get RM90K, assuming not a single cent is wasted or abused.
I'll bet on the opposite of the coin that this project is bound to fail! Two reasons:
1) This industry must be run in big scale to be able to profit
2) Malaysia is lacking in term of technology application and geographical resources (we have too many mountain!)
This industry is just not our niche.
It can only create stable household income for the farmer, nothing more.
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