Someone please kindly help me to understand this:

There are two reasons mortgage rates haven’t responded more to the Fed’s rate cuts. One is that long-term Treasury yields, which are the benchmark for most mortgage rates, have risen recently, perhaps because of increased concern about inflation as the prices of oil and other commodities soar. The other is that the spread between mortgage rates and Treasury rates has widened as investors and banks become increasingly reluctant to make home loans.

- wsj.com

八阕 http://www.popyard.org 【八阕】英国《经济观察报》2007年5月8日讯：中国著名经济学家、北京大学厉以宁教授最近提出的新基尼系数理论在国际经济学界引起极大震动。 厉以宁教授的理论是，按中国现阶段城乡二元经济的情况来分析，先算出两个基尼系数：一个是城市的基尼系数，另一个是农村的基尼系数，然后再加权平均，算出一个总基尼系数。这个总基尼系数可以在一定程度上代表中国的贫富分化状况。

这种基尼系数计算方法的经济学基础是中国是一个城乡二元体系，这种体系是历史形成的。城乡居民的收入来源、消费方式、社会心理都有极大的差别，因而必须将二者分开计算。如果将二者混合计算，将夸大中国的贫富分化状况。

当 然，这种城乡二元的基尼系数计算方法并不是终点，而是起点。中国的东部地区与西部地区的差别实际上类似于城乡二元体系。如果换个角度，不是从城乡，而是从 地域角度，基尼系数的计算方法应该是计算一个东部地区的基尼系数，再计算一个西部地区的基尼系数，然后再将二者加权平均，算出一个总基尼系数。

点 击 图 片 看 原 图

依此类推，中国不同省份的发展状况是历史形成的，应各省分别计算基尼系数，再加权平均算出全国的总基尼系数。同一省份应分别计算下属各县市的基尼系数，再加权平均，算出该省的总基尼系数。同一县市的不同乡镇也应如此计算。

Read The Full Story…

（1）Conversation during a meal should focus heavily on giving compliments to the chef （在用餐过程中，谈话焦点应该集中于对Chef的大力恭维）。

（2）It is customary to arrive slightly early for social engagements （社会交往一般要比约定时间稍微早到一些）。

（3） When dining in a restaurant, discussing illness, death or tragic events is not appropriate as it is seen as bad luck（在餐馆用餐，避免谈到疾病、死亡或者不幸事件，因为这被认为是不吉利的）。

（4） The Chinese do not typically use exaggerated gestures or facial expressions while speaking, and may find them distracting when done by others（中国人在讲话过程中不做夸张的动作或者面部表情，而且不欣赏别人做出类似动作）。

（5） Gift giving is important and somewhat ritualized. Avoid gifts of great value, as they may embarrass a Chinese person and may be declined（送礼很重要，而且要仪式化。礼物的价值不要太高，否则会使中国人尴尬甚至拒绝礼物）。

（6） People often decline a gift several times before accepting it. Be persistent until they accept（中国人收礼之前先要拒绝若干次，所以送礼的人一定要坚持，直到中国人接受为止）。

（7） It is customary to bring a gift when invited to someone’s home such as fruit, candy or a souvenir from your home country（接受邀请去中国人家里做客时一般要带礼物，可以是水果、糖或者从本国带来的纪念品）。

“商务文化注意事项”有8点：

（1） Introductions are usually quite formal. The Chinese traditionally nod or bow slightly when greeting. However, handshaking is also common and appropriate（互相介绍相当正式，中国人一般是用点头或者轻微的鞠躬作为打招呼的方式。不过握手还是最常见和恰当的）。

（2）If greeted by the somewhat uncommon custom of applause, the appropriate response is to applaud back （如果受到意外的鼓掌欢迎，最好是以鼓掌来回敬）。

（3）Appointments should be made in advance（约会必须提前确定）。

（4）Punctuality is very important in China for both business and social engagements（在商务和社会交往中必须准时）。

（5）Bring numerous business cards, preferably printed in English on one side and Chinese on the other（准备好足够数量的名片，最好一面是英文，一面是中文）。

（6） When referring to the nation on formal documents or speeches, it is appropriate to use the full title: The People’s Republic of China（在正式文件和谈话中提到中国时，应该使用全称“中华人民共和国”）。

（7） Business is not generally discussed over a meal, though you may be treated to a banquet during your stay. If possible, you should always return the favor（你在访问中会被邀请参加宴会，但在用餐中一般不谈商务。如果可能，最好回请）。

（8） Business dress is conservative. Men should wear a suit and tie, while women should wear either a dress or a skirt and blouse（商务着装偏保守。男士应穿西装、打领带，女士应穿套装，裙子或裤子也可）。

Google Aims to Crack China With Music Push

By LORETTA CHAO and ETHAN SMITH
February 6, 2008; Page A1

Two years after Google Inc. began a big push in China, Baidu.com Inc. continues to dominate the country’s Internet search market, thanks in significant part to a controversial and legally risky offering: searches for free, unlicensed music downloads.

Now, Google is preparing a counterstrike, according to people close to the situation. The U.S. search giant is in the late planning stages of a joint venture with a Chinese online music company that would permit it to provide free — licensed — music downloads in China.

The service, which is likely to offer access to tunes from three global music companies as well as dozens of smaller players, could start in the next several weeks barring any last-minute hiccups. The music pact marks a turning point in Google’s battle with Baidu to gain dominance in an Internet market that is soon expected to surpass the U.S. this year in number of users.

Baidu has proved a brash adversary for the much larger Google, leveraging its status as hometown champion in China to beat the U.S. Internet giant at its own game. From the start, Baidu has boasted that its knowledge of China and the Chinese language would give it a natural advantage over foreign rivals.

“We’ve been the No. 1 Web site in China for a number of years, and in fact we are the largest Web site outside of the U.S.,” says Robin Li, Baidu’s co-founder and chief executive. “When people get to know about the Internet, the first Web site they learn is about Baidu in China.”

Google declined to comment on the China music plan. In the past, Google executives have made clear the company’s determination to overtake Baidu. “We were late entering the China market, and we’re catching up,” Google Chief Executive Eric Schmidt said during a visit to Beijing last April. “Our investment is working and we will eventually be the leader.”

A significant part of Baidu’s success has been its music search service, which draws a sizable chunk of traffic — at least 7% of its total — to the site by facilitating easy access to free music. Baidu makes money by selling ads directly on its music pages. The free music also entices users to come back for other services, all of which helps the company sell advertisements.

Unauthorized Downloads

But searches for unauthorized downloads have also made Baidu a target for music companies trying to protect their rights in a country where piracy has crippled the entertainment industry.

Google has not provided any unlicensed links to music products in China even though avoiding music has put the company at a disadvantage.

Google’s new China strategy is widely viewed as a logical next step for digital music, but has until now been resisted by record labels, which feared further cheapening the perceived value of their products. Experimenting with such a system in China, where a legitimate music market is virtually nonexistent, could be a palatable entryway.

If the plan works, it could provide a road map for music industry offerings elsewhere in the world. Though piracy is more pervasive in China than in North America and Europe, it is a serious and growing challenge in those markets, which generate the lion’s share of sales for the four global music companies.

Digital ‘Watermark’

The proposed venture goes directly after Baidu’s music search audience, by offering high-quality music files embedded with a digital “watermark” that lets record labels track how often their songs are downloaded. The idea: Better-quality files will draw users away from unlicensed downloads, and give labels and search companies valuable data needed to make money from advertising, say people familiar with the plans.

Read The Full Story…

China Drugs: A Cautionary Tale

Contamination Case
Underlines Risks
Of Outsourcing

By NICHOLAS ZAMISKA and AVERY JOHNSON
January 31, 2008; Page A11

HONG KONG — A contaminated anticancer drug made by one of China’s largest pharmaceutical companies underscores how quality-control problems continue to plague the Chinese drug industry. There is no sign the tainted leukemia drug was exported. But the case provides a cautionary tale as Western pharmaceutical companies start outsourcing some manufacturing to China.

Last June, Yan Zhenni, a 5-year-old with leukemia from Shanghai, received a shot of the anticancer medication methotrexate. But the drug meant to treat her left her incontinent and unable to walk on her own, her mother says.

• The News: A leukemia medicine made by a unit of one of China’s largest drug companies was found to be contaminated.

• The Big Picture: Although no tainted products were exported, the case highlights quality-control problems in China’s drug industry as Western companies look to produce more medicines there.

Possibly dozens of patients across China who took the drug from the same Chinese factory had similar problems. The drug’s manufacturer initially said the reactions might be a side effect of the medication. Later, government officials investigating reports of problems with the drug discovered the medicine had been contaminated, blamed its maker for a coverup and revoked the factory’s license to make the drug.

“We were so hopeful that she would recover from leukemia eventually. The chances were very good. But now even walking has become a problem,” says 28-year-old Ms. Yan, who took a leave from her job at an auto-parts factory to care for her daughter.

Over the past year, a spate of safety problems involving Chinese-made products has surfaced, mostly involving small-scale factories operating with little scrutiny. But the tainted leukemia drug given to Yan Zhenni was made by a subsidiary of one of China’s largest and more prominent drug companies, Shanghai Pharmaceutical (Group) Co. Other units of the company make medicines in collaboration with a number of multinational drug companies, although there is no sign that the quality-control problems affected other divisions.

Major drug companies are quickly moving to conduct research and some manufacturing in China, as costs in the U.S. rise and they face hurdles in bringing new drugs to market and defending existing blockbusters against generic competition. AstraZeneca PLC, GlaxoSmithKline PLC, Pfizer Inc. and Bristol-Myers Squibb Co. have all recently announced plans to outsource some of their manufacturing capacity.

China is still a relatively small player when it comes to exporting finished pills, a market that India’s generic-drug makers dominate. But China is the world’s largest producer of active pharmaceutical ingredients, the chemicals needed to produce drugs. In 2005, China had $4.4 billion, or 14%, of the world’s $31 billion market for APIs, ahead of Italy and India, the world’s second- and third-largest players respectively, according to a report last year from Credit Suisse.

Read The Full Story…

Developing Economies Face
Reckoning as U.S. Stumbles

By PATRICK BARTA and MARCUS WALKER
January 24, 2008; Page A1

Today’s global economic crunch was made in America. But despite hopes to the contrary, the pain will be shared by developing nations from Turkey to Thailand.

Developing economies — where 85% of the world’s population lives — are maturing and are far less fragile than they were a decade ago. But they aren’t strong enough to escape the pain of a slowdown in the industrialized world or self-sufficient enough to hold up global growth on their own.

Those realities were underscored this week, as stocks in China, India and other parts of developing Asia swooned amid fears of a global recession. Hong Kong’s Hang Seng Index suffered its biggest point decline ever on Tuesday, and Indonesian shares dropped more than 7%. While many Asian markets rebounded strongly yesterday, worries persist that developing-world markets remain at risk to the gathering economic storm.

Many emerging markets are reliant on exports to rich countries. And while local sources of economic growth, including consumer spending, have taken root in China and elsewhere, they aren’t enough to keep developing countries from slowing if their export engines sputter.

Economists have been debating for years whether the developing world is robust enough to motor ahead should the mammoth U.S. economy soften. That theory of “decoupling” now faces a real-world test, and is a major topic at this week’s gathering of the world business and political elite at Davos, Switzerland.

“No country can decouple from the U.S.,” said Kamal Nath, India’s trade minister, at Davos. “The question is the impact.”

American consumers hold far greater sway over the world economy’s fate than do their counterparts in the big emerging markets: They spent about $9.5 trillion last year — nearly six times as much as Chinese and Indian consumers between them, said Stephen Roach, chairman of Morgan Stanley in Asia.

In Thailand, shoe exports are already cooling and some apparel factories have closed. In China, furniture makers are facing weaker sales. Hua Chao Art & Furniture in Zhongshan says exports to the U.S. fell about 17% in 2007 compared with the previous year, in part because of the U.S. housing bust. “Production may shrink and jobs may be cut accordingly,” said a sales manager at the company.

Read The Full Story…

Bank Says Trader’s Fraud
Caused $7.2 Billion Loss

Société Générale
Cites Elaborate Means
Used to Elude Controls

By DAVID GAUTHIER-VILLARS and NICOLAS PARASIE
January 24, 2008 1:08 p.m.

PARIS — Jérôme Kerviel, a 31-year-old trading in “plain vanilla” futures at Société Générale SA, pulled off what appears to be a singular feat in the world of finance: putting together what the bank termed a string of “elaborate fictitious transactions” that amounted to a €4.9 billion ($7.2 billion) loss.

Now the bank appears to have lost Mr. Kerviel as well.

Jerome Kerviel

Société Générale Chairman and Chief Executive Daniel Bouton said Thursday that the bank didn’t know Mr. Kerviel’s whereabouts, though it was still trying to mop up the path of destruction he had left behind.

Using what Société Générale co-Chief Executive Philippe Citerne described as “pure fraud,” Mr. Kerviel dodged myriad elaborate computer-control systems and an army of 2,000 back-office supervisors to make huge bets on stock-index futures.

Société Générale said it lodged a legal complaint with French prosecutors against the trader. The complaint alleges Mr. Kerviel committed fraudulent falsification of banking records, fraudulent use of such records and computer fraud.

Former Barings futures trader Nick Leeson in November 1995.

Here’s a look at stories in the Journal over the past decade on trades gone bad, and an accompanying photo gallery above.

• Behind a $550 Million Bad Bet: A Mystical Man With Ambition(CAO Singapore, 2004)

• Junior Staffers Cited for Stopping National Australia Bank Scandal(2003)

• Allied Irish Banks Say a Rogue Trader Lost $750 Million in Unauthorized Deals(2001-2002)

• Sumitomo Trading Scandal Still Haunts Copper Market(1996)

MORE

• Deal Journal:Who Are You, Jerome Kerviel?

• Daily Davos:Massive Trading Loss Is Talk of the Town

Mr. Citerne said the bank failed to notice the unauthorized trades until last week because the “smart” trader had an “intimate and malicious” knowledge of Société Générale’s procedures and also knew the days in which they were conducted.

“Each time he took a position one way, he would enter a fictitious trade in the opposite direction to mask the real one,” Mr. Citerne said. He said he was at a loss to explain the motivation of the trader, who didn’t benefit from the alleged fraudulent trade. “He was mentally weak,” Mr. Citerne said. “I have no idea why he did that.”

Mr. Kerviel, 31, joined Société Générale in August 2000 and was working as a trader on the futures desk at the bank’s headquarters near Paris. He was in charge of futures hedging on European equity-market indexes, known as “plain vanilla” futures.

Though Société Générale says it first learned of what it termed “massive fraudulent directional positions” last Saturday, it waited until it could close out those trades before going public with the problem. Winding down the trades, the bank said, resulted in a €4.9 billion charge, making it potentially the largest loss ever from an alleged rogue trader.

The size of the loss also raised questions as to what role regulators are playing, and even whether they would ever be able to detect such a fraud.

Christian Noyer, the governor of the Bank of France, said an investigation was to begin immediately at Société Générale to figure out the origins and methods behind the fraud. “We will closely examine how the process malfunctioned and look into whether the internal controls were sufficient,” he said at a news conference. Once the investigation is completed and the bank had “a complete vision of the methods used by the trader” it would decide whether any regulations or oversight needed to be tightened at France’s banks. “We need to learn what happened at Société Générale to make sure this cannot happen again,” he added.

Read The Full Story…

French bank to seek $8 billion in new capital after it discovers trader’s fraud, takes subprime-related writedown.

PARIS (AP) — French bank Societe Generale said Thursday it has uncovered a $7.14 billion fraud - one of history’s biggest - by a single futures trader who fooled investors and overstepped his authority.

The fraud destabilized a major bank already exposed to the subprime crisis. France’s second- largest bank by market value said it would be forced to seek $8.02 billion in new capital.

Trading in Societe Generale’s shares, which have lost nearly half their value over the past six months, was suspended on the Paris bourse. It was unclear when trading would resume.

The bank said it detected the fraud at its French markets division the weekend of Jan. 19-20. In a statement announcing the discovery, it called the fraud “exceptional in its size and nature.”

It said a trader at the futures desk had misled investors in 2007 and 2008 through a “scheme of elaborate fictitious transactions.”

Read The Full Story…

Buying Into China’s Land Rush

Americans, Others
Acquire Luxury Homes
Despite Restrictions

By LORETTA CHAO and JASON LEOW
January 18, 2008; Page W1

Beijing

Once known for drab, government-controlled housing and ancient courtyard homes, China has become a land of multimillion-dollar apartments and soaring property values. And foreigners are trying to get in on the action.

Real-estate prices in major Chinese cities have been shooting up at double-digit rates year over year, boosted by an economy that has been growing at more than 10% annually. The jump in prices has been so sharp that the government in mid-2006 implemented stricter controls on foreign investment in hopes of reining in housing costs. Still, foreigners keep buying.

Bill Bishop, a 39-year-old American living in China, bought a four-bedroom penthouse in Beijing in 2005, choosing a luxury complex built by a big-name developer and run by a well-known property manager. The apartment was an unfinished shell — a common way of buying a unit in China — and fitting it out took more time and attention than Mr. Bishop, a private investor, imagined it would. But he estimates that the home, for which he paid “a fraction of the cost of an apartment in Manhattan or San Francisco,” now is worth at least 50% more than he paid for it.

Read The Full Story…

华 盛顿17日电／面对经济衰退的担心日增，美国总统布殊与联储局(Fed)主席长伯南克17日纷纷表态，指出国会应尽快制定刺激经济的方案。政府官员透露， 布殊私下告诉国会领导人，他支持用给个人退税和给公司减税的做法，避免经济陷入衰退。与此同时，伯南克也呼吁国会迅速制定一个刺激经济的一揽子方案。据 悉，布殊、国会领导人和伯南克挽救经济的一个主要做法将是退税。现在民主、共和两党领导人考虑的退税数额是：个人退税300美元至800美元；夫妇退税最 多可得1600美元。 Read The Full Story…