“Oba-mao” – currency change comes along?

Obama finished his China visit with a tour to the Great Wall.
From Guardian UK
Saul Loeb/AFP/Getty Images

Mr. Obama’s maiden visit to China has obviously led to great attention from not only Chinese but also the whole world. “Obama+Mao”, or “Obamao”--Chinese youth online created the word for the new start of the relationship between the two influencing powers in the world. So is there any actual progress on the economic issue from the talk, esp. the currency dispute? Has Obama got what America wants, economically speaking, trade disagreement and currency issue, in the end?

Not much. At least there was no actual progress regarding the vital and sensitive economic conflict. The currency issue was not even discussed in the talk of two leaders. Major newspapers in US and Europe expressed their disappointment in the articles, while on the hand, Chinese media presented their optimism and national pride resulting from a tighter relationship.

The photo above made appearance in a lot of news coverage last week. No one did better than this metaphor in the Guardian article. Guardian says, Obama fails to breach the Great Wall of China. The news concluded the progress of the visit with a focus on the currency issue. In the article, the Great Wall referred to fixed currency rate. Rather than a precise piece of news, the article told the story well with the metaphor. One major example is the “outsiders” view of Great Wall (country's separateness and historic isolation).Though it is not the fact and with no actual source, it served as a turning point where the story began with Obama’s welcome for Chinese growth. The following part presented a lot of interview and analysis from different sides and expert, which is very diversified and grounded. In all, the article remained neutral towards the visit. When it regarded any potential breakthrough as “magical”, the writer was already not positive before the visit and thus the result was acceptable for him and for “long term view of US.”

However, in the eyes of most Western media, the visit is a total downtown for Obama and indicates the weakening American economy after the crisis. In fact, he did not achieve any actual agreement but only a so-called “joint statement”. As the Times online commented, Obama should have “a little less conversation”, even WSJ thought “Obama hit a wall in China”. WSJ is just one example of the upset American media towards Obama, which is not surprising considering his lower supporting rate in the country right now. The whole coverage on WSJ took a completely negative view on the “imagery” visit, claiming Obama was “hectored about economic policy”. It did a great job analyzing the domestic political dilemma for Obama and ignoring of human rights issue regarding the Asian visit, which represents more American media’s views. Also, WSJ quoted a lot of opinions from Chinese state-own media and officials, as well as some provocative democratic protestors. Therefore the news does not really revolve around the topic and poorly organized for it included every detail connected with the Obama’s visit. Also, with fewer figures, the article is more analytical than “fact presenting” style.

Obama and China made the headlines for most US media during the week. For example, another US media, LA Times, which is more casual and targets at ordinary audience, also posted several articles. Besides a long one commenting on the visit with a focus on human right and problem of Iran, there is also one about the currency “standoff”. The photo used somehow implied the gesture of Obama and the triumphant position of China. Though much information provided in the news is irrelevant to the visit (to be honest, there IS no actual progress on the currency issue in the visit), the content impressed me with how insightful and informative the editor was analyzing the decision of Chinese currency and impact on export industry. In the process, it included term explanation, interviews from Chinese export industry, specialist and politic leader. The news was clearly in two parts and not quite cohesive, when the first kept a negative view blaming China’s currency policy and referring to the visit and the following explaining Chinese situation I mentioned above. In all, the style of the article is related to explaining the news to serve wider audience of mainstream Americans, instead of presenting financial news and precise figure.

Professional financial media, on the other hand, did take a more straightforward approach with the currency issue. FT and Bloomberg, all used similar headlines which was “Obama urged China to strengthen Yuan”. However, there are still differences in the news writing style. Bloomberg, more professional with “Heed Commitment on Currency Appreciation” rather than FT’s “strengthen Renminbi”, provided a lot of historical data regarding exchange rate and trade imbalance. It emphasized the problem of currency and protectionism without any biases or implication involved. FT, on the other hand, is more thorough with the whole progress of currency debate over these days. And it involved more interviewees and information about overall bilateral relations, which could come handy with a wider range of audience than Bloomberg. Besides, FT Uk section provided us with another article on the issue with only different editing of the news. (The one above is from China section of FT International) Although a large part of the news is the same, the part about protectionism was taken out while it added some coverage on Europe’s reaction towards Chinese currency and the European leaders meeting in China next week for its target audience in Europe.

When it comes to China, it is all good news over the visit. Firstly, national pride. As we can see from one headline on Xinhua net, Obama was “inspired by the majesty”. Secondly, improved bilateral relashionship. Finally, the unlikely appreciation of the domestic currency. But there are still a lot of blogs concerning the problem of currency and potential economic bubble.

Frankly speaking, since there are not a lot of facts to work on, most media took an approach of either focusing on how disappointing Obama’s visit was or trying to draw a conclusion regarding the trend of Chinese currency. In my eyes, Obama came with the intention of pushing China to appreciate its Yuan, which served for the maximum interest of America. So are most developed countries and IMF. However, considering the long term fact that Chinese economy heavily relies on export and China holds large amount of US government debt, it is unlikely that China will revalue its Yuan soon, not even to mention appreciation. Nevertheless, to US, Obama’s visit doesn’t improve the economy or Iran issue; to China it only indicates another round of attention and pressure on the appreciation of the currency.

My words:
Starting from the sino-US trade friction about the chicken dumping, I finished my blogs with Obama’s visit to China. When it comes all the way around, as same as the major stars of the world economy, it is about China and US. Together, they influenced the world economy heavily with their inseparable yet conflicting relations. Under the clouds of crisis, it seems that there are a series of economic problems in US while China remains its growth. But is that the truth? Speaking as a Chinese, I can see the pressure towards China from the West and from domestic economic imbalance as well. In all, two giants can only be connected tighter and have to work through more complex dilemma in the coming future.


The future of Google Books and its copyright issue

From Telegraph UK

As a loyal user of Google products, Google books and scholar are among my top list of Google products. However, in the eyes of the authors and other digital cooperation, the practice of Google Book obviously is not on their fave list. This popular online digital library has been interfering with the interests of authors (copyright issue). For now, I just wish that after everything settles, I can still use the online resources from Google Books, maybe not as convenient as now.

It all started with the objections from US authors and a lawsuit regarding the copyright infringement in 2005. The proposal now handed to court in America actually concerns authors worldwide. It was quite ironic to see the anger and objection from Chinese authors in October ( FT article ), since China is accused for copyright violations. Nevertheless, though China is separate from this week’s agreement in New York, a few Chinese media still presented the news. People’s Daily Online, most political and state-own newspaper in China, implied an image that Google was “bad guy” in the crime theme and authors, especially Chinese authors, became the victims. A major part and main figures in the news revolved around the severity of copyright infringement in China. It seemed that all Alegre, the vice president of Google Asia tried to do was to find excuse and ways to compensate. There is no analysis in the article while it generally remained negative towards Google’s behaviour.

However, in Global Times, relatively more democratic paper in China, we can see some positive opinions. The use of terms in headline, “confer on copyright”, indicated the neutrality of the article. Indeed, the news provided us with some advantages of Google books. The interesting part is, although from the same interviewee as the people’s daily one, what the representative from CWWCS said quoted in this piece of news mainly referred to the benefit to Chinese authors. Same figures are included as well. Besides, no doubt that the journalist did some research for the article, information from Forbes was cited to provide fresh new opinions.

What it comes to the worldwide solutions, mainly US proposal, major media in Britain also had some coverage, such as the short “message” from Telegraph in technology section. Generally speaking, it was a plain article filled with key facts regarding the event, though some interviews were included. The same articles was posted in Telegraph in finance section as well, with a different headline which maybe appealed more to business readers “ narrows scope of the project” instead of “digital library hurdle”.

Times online is among the negative ones as to whether the new proposal could benefit the company and authors around the world. In all, it was informative and unbiased trying to explain the background and the content of the proposal with interviews. As a major newspaper in UK, though the event was not particularly related to UK, Times still took the effort to consider the opinions from other parts of the world, such as the details from Chinese situation. In the end, Times also localised the news with interview from British Publishers Association, which made the news relevant and worthy reading for local audience.

Compared with other domestic media, FT took a more detailed and professional approach with the proposal. Presenting a really long article, FT took the headline differently from the ones in other media, focus on the authors instead of Google. (Headline: Authors win Google book concession).But main body of the article was neither about the efforts of authors nor the “drama” at all. It was very impressive in the parts which presented the details of the agreement and compared it line by line with the old ones. Informative for professional readers, but boring and lengthy for readers like me. Luckily, the editor seemed to realise the setback of this arrangement already, when additional column was set aside marking the “key point” in the new agreement.

Speaking of the professional style of financial media, this one in FT set an example. Firstly, only this piece and the coverage on Bloomberg (which will be discussed later) have mentioned the opinions from Google’s business rivals. To consider from the digital books business, FT and Bloomberg both came up with the potential risk of Google monopoly in the industry resulting from the new agreement. Secondly, every citation and opinions from the interviewees were clearly marked with the name and position of the speaker. When comparing with the Times online article in question, it is easily noticed that with the same contents, Times interpreted it as one part of analysis while FT stated the speaker clearly. No wonder that people turn to media like FT for more convincing and accurate financial information.

Now continue with the one on Bloomberg. Though much shorter than FT one, it did include the main important facts of the issue. A fresh resource of information, the official statement from Google on its corporate web site was cited. Besides, as I mentioned, Bloomberg also commented on the issue from the angle of whole industry and presented similar quotation as FT did. However, it provided us with much more information about the rival companies, which was confusing and somehow irrelevant. Inserted abruptly in the article, the part was a brief introduction of two major rivals, Amazon and Microsoft, as well as their intention to enter the online book publishing business.

As far as I am concerned, the agreement at least benefits most of the researchers around the world, but since it only applies to US and three other countries, it is too early to say what the impact will be in the global scale. On the other hand, the online book market indeed has been growing tremendously with more competitors. As a result, the copyright issue becomes more pressing and evitable in the future. Google Book is just a start and it grabbed attention due to the brand Google.


Brown’s tax proposal given lukewarm response

From Mailonline

Gordon Brown has raised the possibility of a worldwide levy that would pay for bailouts

When I was just about to post the blog about UK’s PM Gordon Brown’s controversial proposal on transaction tax on Saturday, I was so surprised to find an update on FT.com regarding Mr.Brown’s change of plan. To be more specific, after indulging myself in the pleasure of reading quite a few news articles and blogs mocking Mr Brown’s embarrassment in G20 meeting, I was indeed shocked to see him change the tack so rapidly.

Good job FT. It is the first media and the only one so far to have updated the story and put it on the front page. What is more, there is one analysis/comment written by PM himself! (or I should say, his staff.) In my eyes, it is so strange and my first time to see a political VIP like Mr.Brown writing an article for non government owned media. Maybe it is a common thing here? It suddenly reminded me of the famous Fireside chat from President Roosevelt in US. I read through the article and did find some resemblance there. Similar to Mr.Roosevelt’s talk, this one, with the title of “How we can restore trust in financial institutions”, tried to inject confidence into public under the clouds of national crisis. But considering the media FT, the article itself is more professional and somehow targets at people in the banking/financial industry.

As the editor from FT commented, Mr.Brown defended his argument in the article after isolating UK in the G20 meeting with his immature proposal about banking tax. In his article, he insisted again the importance of “social contract between financial institutions and society”. And he admitted it “not be a comfortable discussion” which indicated the international lukewarm response to his plan one day before. The article from FT did notice the subtle change from PM and officials’ attitude and the critical analysis over the whole thing is very impressive with lots of exclusive information from an aide and “inside sources”. Besides, it really stands out based on the PM’s article and both negative and positive reviews. In a word, it was quite objective and comprehensive and filled with opinions from difference angles.

Coming back to the news report from other media I read before, I found most national media in UK hold a negative opinion towards Mr.Brown’s plan. The flat objections from US and IMF are emphasized in most news.

Take the news from Telegraph as an example. As the headlines states, the news is really all about the “worldwide snub” over the plan. Even in the first sentence, the editor can’t wait to point out the previous government opposition. The whole article is quite pessimistic about his proposal, with lots of expressions such as “dead in the water”, “pour scorn on”. The two “However” parts following the description of Brown’s speech are so strong and it looks like indeed everyone opposed to the idea, ranging from US,IMF to domestic banks, government and opposition politicians. Considering it is Telegraph, it is not surprising that there are relatively large parts of quotations from the opposition party mocking the PM and his idea.

However, there are two points quite worth mentioning here, which made the news on Telegraph somehow not as objective as those on international media. Firstly, based on what i’ve known from other articles, France and Germany are in favour of the transaction tax. Most news quoted the interview from French Finance Minister who clearly stated France’s support for the plan. But in the news here, it turned out that only “experts said” France “might” support the tax, which was followed in the same sentence by strong rejection from more British authorities. Secondly, regarding the response from the Chancellor Alistair Daling, he was listed there as evidence that “even” a person at PM’s side during the meeting “declined to say whether he personally supported the move”. The inclination is so self-evident here.

So what exactly is the Chancellor’s point of view? It is very clear and unbiased from BBC report.(lost the link) The BBC report is more of a conclusion of different response from each party without any opinions involved. According to this one, Mr.Darling said the tax “work in progress” and agreed “it is an important piece of work”. In my eyes, he did not oppose to the idea but quite agree with the general intervention with the banking. Besides, the report in Guardian is more straightforward in the title, “darling backs brown’s Tobin tax”. In other media, such as Sky news, it is claimed that the chancellor “went in to bat for the PM”. Skynews, as the media quoted in other news for its exclusive interview with Mr.Geithner, did take a good advantage of that. It spent a lot focusing on the response from US. The news itself is quite unbiased and very concise with rebuff in the first part and supporting voices following.

In the end, it all comes down to how you interpret the exact words they say. Similar to my observation in the supermarket tussle blog between Tesco and Sainsbury, the implication readers get through the news can easily be affected by the way the news is organized. Nevertheless, I am confused with the expression regarding IMF’s reaction on a Chinese website. According to the article on Caijing, a major Chinese financial media devoted to have independent and exclusive standpoint, IMF is “quite interested” in the tax plan, which is the opposite from most coverage. And when they quote the IMF chairman’s exact words, it still seems to me that he is so impressed with the proposal that he “was inspired and took the initiative to talk about the plan in the interview”. As far as I am concerned, the “active” expression there was chosen merely for the strong contradiction in the comparison with Geithner’s lukewarm response.

Finally WSJ really impressed me with its accurate and detailed report. Rather than comment on the proposal as “humiliation” as most domestic media did, WSJ takes a mild approach which emphasizes the plan itself. Through the whole article, there are no such words as “criticize”, “snub”, “oppose”. Instead, according to WSJ, PM himself “warned that agreeing a levy would be difficult.” Thus all the objections following from US and other countries are not so strong. Starting from “Indeed”, the article changes the opposition into further evidence of PM’s warning. What is more, the news is presented in an absolutely objective way. All the opinions are included when even bankers and economists are interviewed. Moreover, every provocative and maybe controversial comment is the quotation from some interviewee. The article still manages to cover the background information and political implications as well as the current problem of bank failure around the world.

PM’s proposal came as quite a surprise to the world. No doubt that the behaviour is somehow for political interest. With the election campaign gets closer, Mr.Brown is keen to show that Labour Party could be tougher on bankers than the Torries, who are leading the row over bonuses. And it is generally believed that UK is the only one among the major European economy who is still trapped in the crisis. With the rising issue of bank failure and its cost on tax payers, there are indeed plenty of reasons for PM to propose the plan at this point. Sure it will meet a lot of obstacles and transaction tax may not be the best options. However, some actions have to be taken to regulate the banking system and now it just depends on the report from IMF due next April.

It is all about GDP

Source: Telegraph

No doubt that GDP has become a mega star again in this week’s newspaper, both in China and UK. And the whole world is her audience. Under the shadow of the crisis, it is not surprising to know that most countries, esp. UK and USA, are still trapped there. While I went through the comparison on Telegraph, I just burst out laughing when I saw China’s “never in recession” stand out among the list of suffering countries (“still in recession”/ “out of recession”) above. Indeed, China shocked the world with the 8.9% increase GDP for 3rd quarter. On the other hand, UK economy shrank by 0.4% for the same period, which was a shock as well to the optimistic analysts. It is all about GDP this week.

GDP is by far one of the most obvious and important economic indicators, which could bring about the speculations of one nation’s future policies. Besides, it is always worth reading how the analysts defend their previous and totally opposite predictions.(Eg. UK this time).And to be frank, is there anything to learn from Chinese success in the recovery process?

Good news first. China did it—the promise that the nation would maintain the growth over 8%. According to official data (source), besides the 8.9% overall growth, the highlights lies in the fall of CPI (1.1%), the continuous increase in retailing and climbing figure of fixed-asset investment and housing price. Take a look at the official press release, it is just good news along the way. As usual it is hard to get any indication of policy shifts from the official documents. Only the need is to expand the internal demand and keep the upward trend. And though the concern for inflation is mentioned in several comments in Chinese media, it seemed the government still took the moderately loose monetary policy for now.

The rebound is firm; no sign of inflation yet; public confidence goes up...those all are the key points in the coverage in Chinese media. Most news quoted the statistics from the government and analyses from “experts” are quite similar. In a word, most media remain extremely optimistic towards the economy in China right now. What is more, people are satisfied with it, which is obvious from all the great predictions on the 8% GDP growth over the year. On the contrary, the Chinese are not as optimistic as the government. In several blogs, people are sceptical of the credibility of data from the bureau, which is mainly due to the common exaggeration of the economic performance by the government and the decline of actual living conditions resulting from the subtle inflation.

Nevertheless, the incredible number 8% surprised most international media when most countries are still suffering. AP delivered a comprehensive analysis on the growth in China. The report is very critical and detailed with lots of data and comparison with other countries. Besides, though mentioning the government stimulus as the main reason for the economic boost, the news did not just focus on criticizing the policy as some Western media did. Critiques and quotations from Chinese officials are mentioned in turn. Generally speaking, despite the concern for Chinese dependence on export and the imbalance in structure, the article emphasized the remarkable role of Chinese economy and market in the world.

WSJ also posted an article with so much optimism and enthusiasm into the future of Chinese economy. Even more optimistic about the economic recovery in China, this piece of news provided the readers with all kinds of data, from the bureau, interviews from the professionals, investors and foreign companies in China. All the data and remarks in the article seemed to show a bright future ahead. Though mentioning the global worries, it always presented the best argument and convinced me a really great Chinese economy and good outlook on world economy.
Under most circumstance, it is really rare to see any media coverage on Chinese economy that could be regarded fair and objective. Either it is too optimistic with the ignorance of actual complicated Chinese situation. Or it is criticism all over, like most western media do at the moment. As seen on the blog on Forbes, Chinese economy is all about fake data and “over-reliance on stimulus package”. It is quite a surprise to me that the analysis is somehow well organized and filled with actual data. And the argument the author made is true to some extent. However, the totally negative review made the article not newsworthy at all.

China is developing under such a unique mode that it became so hard to understand or fit into any western economic theory. Anyway you could just do as they did on Mail online, see the news as an indicator for investing in China. The news is quite blunt pointing out the “sole reason” to be the government stimulus. The term “lavish” there indicated their view on the approach. However at the end, it did mention the attention from international investors on the wording used by Chinese officials, which is quite precise and good point according to the situation in the country.

The news on mail online also mentioned the GDP figure in UK would be released soon and its good wish towards an optimistic figure. Unfortunately, when the data was released next day, the whole nation was in dismay. Or I should say “shocked”, as seen in lots of headlines among the domestic newspaper. Every news article reported the “unexpected” 0.4% contraction instead of the expected rise. What is more, it is the longest recession in UK. Compared with the objective Reuters, the report on Time online is more concerned with domestic response under such bad conditions. Ironically, the article recalled previous optimistic predication made by economists and PM. The change of VAT and interview with retailing section just made the news closer and more connected to domestic consumers. The mere GDP figure, under most conditions, does not really make you feel how bad the economy is.

There is another blog on Times, which is just straightforward criticizing the previous predictions by most economists. “Useless” economists, as they said, still regarded the data not calculated right, which is just pathetic argument to defend their previous opinions. It is the truth that the economy in UK is still in deep recession. With the weak figures in every area, the article is all about pessimistic views.

Then reading the comment on guardian, I started to realize the disappointment towards those economists. After all, it is not about those predictions but the terrible economy right now. The author analyzed the possible results from the contraction and nothing optimistic was mentioned. Indeed it is really dark cloudy days for UK right now, especially with other major euro economy out of recession.

PS, this is the blog for the week before. I was sick from a fever and didnt post it.Sorry for the delay.